There is some sense that when courts are able to return, pent-up litigation demand will ramp-up quickly.

There is uncertainty about the duration of this down-turn given it is unclear when in-person courtrooms will be allowed to re-open. Some insurance litigation has increased, too, as businesses have made claims against business interruption policies.Īpart from some specific areas of demand, litigation-heavy firms have seen existing client work slow and new work has not materialized as clients hold on litigation or find alternate routes to resolve disputes. Litigation concerning contract provisions has increased as struggling businesses look to cancel contracts (e.g., through force majeure clauses) or to compel customers to honor agreements (e.g., supplier agreements).

While courts have taken steps to utilize virtual meeting software, the already over-taxed justice system has not been able to replicate in-person court proceedings.Īs a result, litigation practices have experienced a sharp decrease in demand as litigation has stalled with only a few bright spots.

Historical trends, however, cannot account for a period when courts have closed or are scheduling much fewer hearings, indefinitely pausing all but the most urgent cases. Historical data has shown that litigation has traditionally seen steady demand in good and bad economic periods. While some similarities exist between the pandemic economic downturn and past economic downturns, there are many parts of this pandemic that are unprecedented and present unique challenges for law firms. While some areas have seen a drop-off in demand, others, predictably have experienced a large up-tick. Practice Areas: Law firm practice areas have felt the effects of the pandemic differently. Every law firm has a unique mix of practice expertise and clients, but generally speaking, we are seeing some practices and clients perform much better than others. For firms that are struggling, oftentimes, the issues they face come from low client demand or from practices that have been deeply impacted by the pandemic. Law firms that are thriving during the pandemic have in-demand practices and clients that are themselves healthy and therefore able to pay legal bills. In examining firms that have been most successful in navigating these turbulent waters, the profile of a strong firm can take many forms but all strong firms have certain characteristics or have taken similar steps.Įvery law firm is shaped by their core practice expertise and the clients they serve. While the economy has rebounded in significant ways in the later part of 2020 and looks to continue on the path to recovery, new norms are becoming more established.Īs when faced with any economic challenge, many law firms quickly adapted to the fast-changing pandemic economic environment. The economic implications of the shutdowns were unevenly felt as social distancing and other efforts to mitigate the spread of the virus became a norm. Then, of course, the COVID-19 pandemic hit, followed by associated mandatory shutdowns and the deep economic impacts these shutdowns caused. Law firms, in particular, were experiencing record-setting levels of demand after over a decade of low growth. Through the first few months of 2020, the international economy was booming.

First year law firm budget