MDPs Revisited

For the financial year ended August 2000, Andersen Legal, the global legal network affiliated with accounting giant Arthur Andersen, recorded revenues exceeding C$800 million, representing growth of 17 per cent over the previous year. But for the drop in the Euro during that fiscal year, growth would have exceeded $900 million, an increase of 30 per cent. Taken at face value, these staggering numbers from Andersen Legal’s 3,400 lawyers spread across 103 offices, principally in Europe, confirm that MDPs (multidisciplinary partnerships), at least in continental Europe, have been an unqualified success.

But financial statistics, even if not misleading, are rarely the whole story. More telling than Andersen’s results, KPMG K-Legal’s 2,600 lawyers, Deloitte Touche Tohmatsu’s 2,425 lawyers in 46 countries, Ernst & Young’s (E&Y) 1,850 lawyers and PricewaterhouseCoopers LLP Landwell’s 1,800 lawyers, is the hard truth that MDPs have so far not attained their publicly stated objective of competing with the likes of such US and UK majors as Shearman & Sterling, Sullivan & Cromwell, Clifford Chance, Linklaters and Freshfields Bruckhaus Deringer for top-tier international legal work. On this front, they very much remain esurient wannabes.

What is important are the UK and US markets. In the UK, MDPs are rarely found in the professional credits associated with the country’s largest corporate transactions. And apart from Ernst & Young’s association with Washington-based McKee Nelson LLP (about which more will be said later) and KPMG’s “strategic alliance” with 700-lawyer San Francisco-based Morrison & Foerster LLP, the accountants have had little impact on the American market, where their future appears problematic following the American Bar Association’s overwhelming rejection of MDPs last summer. In Canada, both the Law Society of Upper Canada (LSUC) and the Canadian Bar Association (CBA) have moved to a hard line that insists on lawyer control of MDPs.

Overall, there is little evidence that MDPs have escaped the corporate mid-market straitjacket they found themselves in even when they were the “buzz” as little as two years ago. These days, lawyers express a certain “I told you so” smugness that has replaced the fear originally evoked by in terrorem arguments that MDPs would change the practice of law forever.

Ironically, some of the legal profession’s current smugness may be directly attributed to the initial arrogance of the accountants. From the outset, the accountants have made no bones about the grandiosity of their ambitions. Phrases like “largest law firms in the world” and “major players in the transatlantic New York-London corridor” flew about like swallows at Capistrano less than three years ago. In July 1998, Russel Robertson, managing partner for Arthur Andersen LLP in Canada, intimated that the Big Five global accounting firms would take no prisoners in their quest for legal services dominance. “If I were a lawyer, I’d be concerned if…the…major accounting firms got into the legal services businesses,” he told the Toronto Star. And in late 1999, Douglas Black, managing partner of the Donahue Ernst & Young office in Calgary told Lexpert that “My role in Canada during the next three to four years is to build [Donahue] into a national law firm with 300 lawyers. By 2002, Ernst & Young intends to be one of the three largest global business law firms with 3,000 to 4,000 lawyers worldwide. Our objective is the senior corporate market.”

Measured by their own posturing, the Big Five have fallen short, so much so that in the last two years the really big story in the delivery of legal services has been the emergence of the large UK firms as global players. Conversely, pressures from regulatory bodies and internal dissension have forced the break-up of the accounting and consulting arms in a number of the Big Five firms, including E&Y, whose consulting arm is now an independent entity called Cap Gemini. It remains to be seen whether the split will impact on the synergies between the accountants and their affiliated law firms.

Compounding the problem, the various affiliated law firms have, at least in the UK, experienced considerable recruitment difficulties. So much so, in fact, that the bad joke in London is that they are “cannibalizing” one another. For example, PricewaterhouseCoopers’ tied law firm Landwell lost its co-founders, who jumped ship to set up E&Y’s UK associated law firm. Less than a year earlier, PwC lost six salaried partners to upstart K-Legal.

In the US, McKee Nelson, the first American firm to bear a Big Five name, has just announced it will abandon the E&Y branding, drop Ernst & Young from its name and pay off its start-up loan from the accounting giant. Privately, sources close to the firm say a tough stance by the US Securities Exchange Commission (SEC) on auditors providing legal services to audit clients forced McKee Nelson to abandon its formal connection with E&Y. Publicly, firm leaders say that a proposed expansion to New York cannot take place under the E&Y banner because state bar regulations prohibit the use of trade names. Leaders of both firms maintain, however, that they expect the alliance to remain fruitful although the formal relationship will be less overt.

Peter McKelvey, now Chief Operating Officer at Miller Thomson LLP, but until recently a legal consultant with E&Y’s Toronto office, was closely involved in the formation of Donahue Ernst & Young LLP, Canada’s only Big Five MDP firm. McKelvey is uncertain as to the consequences flowing from the latest US developments. “McKee Nelson wants to become independent of Ernst & Young to satisfy the SEC. Whether they can accomplish that and whether their alliance will remain fruitful by being “best friends” without formally shared economic interests is unclear.

In this country, the unwillingness of other major accounting firms to enter the legal market, at least at this point, speaks volumes as to their cost/benefit assessment of Donahue Ernst & Young. Although Donahue has become a national firm with offices in Toronto, Montreal, Calgary and Ottawa, including a strategic alliance with Clark Wilson in Vancouver, its 120 lawyers are well short of Doug Black’s earlier predictions. As for the “senior corporate market” that Black targeted, Donahue has appeared on major transactions only sporadically and primarily in the Calgary energy market. “Donahue has top-tier problems, many of them arising from internal conflicts and the SEC rules [publicly supported by Ontario Securities Commission (OSC) Chair David A. Brown, Q.C.],” says Peter McKelvey. “Have Donahue done Tier 1 deals? Yes, but not as many as they want. Senior lawyers won’t go where they are going to be conflicted out regularly.”

The situation may have been different, McKelvey adds, had other Big Five firms entered the Canadian legal market: “The accounting firms are forever swapping conflicts clients in receivership situations, and we could have done that in situations that caused problems between audit clients and associated law firms.” In the end, McKelvey believes MDPs will have to devise alliances that satisfy the concerns about conflicts of securities regulators between legal clients and audit clients.

Yet, as things stand now, Michael Thompson, (Managing Partner, Toronto), Doug Black (Managing Partner, Calgary), and the other Donahue lawyers interviewed for this article express nothing but satisfaction with the progress of Donahue Ernst & Young. “Our financial expectations are high and we’re meeting them,” says Black. But is this simply skillful spin doctoring? Which is it? Are MDPs in Canada a “disaster,” as one observer puts it? Is Donahue “a growing firm of importance,” as Black says? Is the answer somewhere in the middle? Or is it just too early to tell?

On careful analysis, and putting aside the initial bravado of Black and others, a strong case can be made that they ought not to be hoisted on their earlier boastful petard. Simply put, their failure to live up to their initial rhetoric is not the true measure of their success. Rather than assessing their performance after less than five years as against the Seven Sisters, as the top-tier Toronto firms have been dubbed, a more appropriate yardstick would be the progress of similarly placed firms. “After all, you can’t expect us to have the same client base as Davies and Oslers in just four years,” says Michael Thompson.

Most prominent among firms that have recently entered the Toronto market are 288-lawyer Montreal-based Ogilvy Renault, Canada’s ninth-largest firm, and 219-lawyer Bennett Jones LLP, Canada’s 13th-largest firm. Both firms have rich histories going back more than a century and both are corporate heavyweights. [Editor’s note: This article was submitted prior to the June 12 announcement of the Ogilvy Renault/Meighen Demers merger. This development, however, does not alter the logic of the argument being made.] Both, moreover, have in recent years entered the Toronto legal market. The result: Ogilvy Renault now has 53 lawyers in its Toronto office, while Bennett Jones has 26. Michael Thompson, on the other hand, lacking the size or reputation of either of those firms behind him, has built a 70-lawyer Toronto practice from scratch. Pundits of course will point out that Mr. Thompson has had the not inconsiderable resources of Ernst & Young backing him up, but, nevertheless, the comparison is instructive.

In large part as a result of the drawing power of former Stikeman Elliott partner James Riley, Ogilvy Renault’s Toronto office has had an important presence on a number of major transactions. Nevertheless, the consensus on the Street is that the firm’s Toronto office lacks the depth to crack the top ranks. Bennett Jones, which experienced a number of senior defections from its Toronto office in late 1999/early 2000 (most notably the departure of John Sabine and Grant Haynen to Donahue), has regrouped by recruiting former McMillan Binch Managing Partner and top-tier banking/structured finance lawyer Bruce Barker. The firm also recently recruited Paul Mantini, one of Toronto’s most prominent property development practitioners, from Smith Lyons LLP. Still, no one would argue that Bennett Jones, as of yet, has been able to replicate in Toronto its top-tier Calgary ranking.

Based on a simple head count, Donahue holds up extremely well, especially in Toronto and Calgary. In fact, its count of 120 lawyers nationally does not convey the full picture in that the firm has opted to refer out its commercial litigation, which forms an important practice area for most major law firms.

Donahue also does quite well in terms of qualitative assessment. Six of its Toronto lawyers—Grant Haynen (corporate finance), John Sabine (corporate finance, M&A, mining), Eileen McMahon (biotechnology), Al Meghji (tax litigation), Franklin Davis (mining) and Norman Keith (occupational health and safety)—can be found in the Lexpert Directory 2001 list of top lawyers in their fields. Robert Couzin, who is formally associated with the accounting firm rather than the law firm, is on the Directory’s “Most Frequently Recommended” list of corporate tax lawyers. By comparison, Ogilvy Renault has eight lawyers and Bennett Jones has six from their respective Toronto offices on the Lexpert Directory lists.

Still, in Toronto, Donahue has not become the “superstar” or deal-maker whose very presence immediately gives a firm top-tier potential, both by drawing books of work and attracting the very best recruits. John Sabine and Grant Haynen fit the bill best at Donahue, but capable and respected as they are, they are simply not—or at least not yet—in the same league as the likes of James Riley. “We are not in there in M&A and corporate finance the way the Seven Sisters are,” Black concedes. “But in Calgary, we decided to focus on the energy practice first. Our next step is to develop the M&A.”

Black is as good as his word. Within two weeks of the interview conducted with Black for this article, Donahue announced that it had recruited Gregory Turnbull from the Calgary office of Gowlings. Turnbull is a rising star who appears in the Lexpert Directory’s corporate/commercial, M&A and corporate finance lists of top lawyers in these fields. Because his reputation is strongest in the oil and gas mid-market and emerging high-tech field, he will not immediately vault Donahue into the world of top-tier transactions. But Turnbull will, as Sabine and Haynen did in Toronto, give the firm strong credibility in his areas of practice. “And we’re willing to grow with him and the excellent reputation he has,” says Black. Clearly, E&Y’s “captive firm” has acquired the virtue of patience, an attribute much more frequently associated with accountants than lawyers.

Still, as Doug Black well knows, recruiting high-profile practitioners and keeping them are two different matters. The defection of top tax lawyer Ronald Sirkis to Donahue from Bennett Jones in 1999 was widely seen at that time as a clear sign Donahue was poised to enter the top ranks. But the Street soon had it that Donahue’s lack of deal flow in Calgary led Sirkis to spend a disproportionate amount of his time in Toronto. The scenario was much like that surrounding the sudden departure early last year of top tax lawyer Scott Wilkie to Oslers from Ogilvy Renault’s Toronto office. The rumours about Sirkis’s lack of work gathered steam just before he left the firm to join the Bank of Montreal as its Senior Vice-President, Taxation. Black, for his part, maintains that Sirkis had been very busy throughout his time at Donahue and his departure to the bank was nothing less than “the opportunity of a lifetime.”

Notwithstanding Sirkis’s departure, Donahue’s client base is impressive for a four-year-old firm. Toronto clients include chartered banks, major pension funds, various international financial institutions, important players in the property development market, and pharmaceutical conglomerates. Prominent mandates include acting as advisors on at least a half-dozen major restructurings, corporate financings and M&As ranging from $250 to $800 million in value. And most recently, Eileen McMahon and her 10-lawyer IP team beat out Canada’s major IP practices in a beauty contest for an American pharmaceutical company’s patent work.

In Calgary, clients include ENMAX, which provides electricity for Calgary, Enron, TransAlta, Shell Oil Company, Andarco, Phillips Petro-leum Company, Shaw Com-munications and the Calgary Regional Health Authority. The firm acted for Pengrove on a $400 million financing that was one of the largest corporate oil and gas financing transactions in 2000. “Ernst & Young has certainly given Donahue some market profile,” says a competitor’s Managing Partner. Toronto Managing Partner Michael Thompson agrees. “In terms of market presence, we’re furthest ahead in Calgary.” The 18-lawyer energy department, in Calgary, has made its mark in offshore and international oil projects, including Hibernia, and in the electrical market. Calgary lawyers staff Calgary-run Donahue offices in Jakarta and Singapore.

In late 2000/early 2001 Donahue entered the Montreal market, opening with six respected corporate lawyers formerly with Fraser Milner Casgrain LLP. Combined with the addition of Turnbull in Calgary, the Montreal practitioners give Donahue a national M&A presence. However, a strong M&A presence outside of Toronto, as Bennett Jones and Ogilvy Renault have learned, does not translate into a top-tier berth in Toronto, at least not in the short and perhaps not even in the medium term.

Still, by any measure other than by comparison to their own bravado, and the cynicism expressed by the not insignificant group of “MDP bashers” in the legal profession, Donahue Ernst & Young has done remarkably well. The firm has capable, respected practitioners, a strong revenue and client base, and is slowly building bench strength in a number of key practice areas. Perhaps surprisingly, the senior core of the group has for the most part remained stable, with few lateral transfers back to traditional firms. This is likely a reflection of Donahue’s culture, perhaps the most difficult variable in gauging the future of MDPs generally.

On paper, most observers agree that the MDP model looks good and makes conceptual sense. The problem, according to the pundits, is cultural, both structurally and professionally. “What we tried to do at Donahue is foster and build a culture in the law firm that could co-exist with the accounting firm culture, recognizing that most lawyers just wouldn’t relate to the accounting firm culture per se,” says Peter McKelvey. “The heart of the difference is independence. Lawyers are terribly independent and adversarial and taught to challenge. Accountants are not. So lawyers don’t take kindly to or respect the kind of structure that we see in accounting firms.”

From a strictly professional perspective, a prominent tax lawyer who joined one of the Big Five a few years ago, and who spoke off the record, puts it this way: “What I’ve observed is that lawyers are planners, while accountants work from a more operational and compliance-oriented base. Lawyers see a project to the point of implementation and accountants pick it up from there and carry it through. Because they get the work at the back end, accountants don’t have the same opportunity to be creative.”

This cultural gap is frequently cited to explain Donahue’s inability to attract a superstar or a law firm merger partner. As explained by the Managing Partner of one prominent firm who had preliminary discussions with Donahue: “The meeting was a joke. The MDPs don’t understand that clients won’t move their legal work to a law firm controlled by its auditors. So the connection with an accounting firm is not an entry, and on their own, the MDPs don’t have the kind of independent reputation that will draw the best legal work.”

This argument may be somewhat harsh as best illustrated by the various reactions to the recent announcement by McKee Nelson, Ernst & Young LLP in Washington, D.C. that it was dropping the E&Y name. Critics of MDPs argue that as McKee Nelson expanded from its primary base as a tax firm and pushed into high-end corporate finance and transactional work, it had to distance itself from the accountants to remain both cohesive and credible. On the other hand, MDP supporters, pointing out that the “P” in MDP stands for “practice” as much as it stands for “partnership,” argue that MDPs are not so much about the form of the relationship between lawyers and accounting firms as they are about an attitude to the marketing and delivery of legal services. McKee’s actions, they say, allow the relationship to continue without running afoul of regulatory constraints.

And the numbers support the pro-MDPers’ view that the alliance has been a success. As in many things, money talks. And in this case the numbers come through loud and clear. In 2000, their first full year of operation, McKee Nelson’s 33 lawyers brought in $40 million in revenue. Further, name partner William F. Nelson fully expects the firm’s current 45 lawyers to generate $60 million in 2001 with the expansion from the Washington base into New York City. These are impressive numbers.

Like McKee Nelson, Donahue is not a multidisciplinary partnership. It is a multidisciplinary practice. The partnership consists of lawyers only and does not split fees with Ernst & Young’s other professional arms. Rather, Donahue pays the accounting firm a management fee for providing infrastructure and technical services. Michael Thompson is Ernst & Young’s Canadian General Counsel as well as being the firm’s Managing Partner. The firm is a member of Ernst & Young International Ltd., the global umbrella entity for all Ernst & Young firms, and each Donahue lawyer is a partner in Ernst & Young Management Consultants, the accounting giant’s Canadian partnership for non-accounting professionals.

In other words, E&Y has proven to be flexible in its approach to MDPs, at least in Canada and the US. “Ernst & Young is trying to develop the capability of delivering multidisciplinary services through structures that are appropriate for the jurisdictions in which we practise,” says Thompson. “So in Europe, we have true multidisciplinary partnerships, but in Canada and the UK, our alliance is in the nature of a multidisciplinary practice.”

This newfound flexibility may be largely a function of regulatory pressure from securities commissions, bar associations, and lawyers’ governing bodies. These pressures clash head-on with the business strategy of envelopment (enter the market at the lower-tier to learn the ropes, then do a reverse takeover of a large established firm) and control, which characterized the Big Five’s abysmal and very public inability to consummate a merger in the UK. Highlighting the debacle in the UK were the failed negotiations between Arthur Andersen and Simmons & Simmons, in the first instance, followed by failed negotiations with Wilde Sapte (now Denton Wilde Sapte) soon afterwards.

Similarly, potential merger partners in Canada have rejected Donahue more frequently than Julia Roberts dumped her fiancés in Runaway Bride. Peter McKelvey, who confirms “Donahue has talked to everybody out there,” believes that the merger efforts have failed because “a lot of people thought Donahue was a risky situation and in some people’s minds an MDP may still be.” With almost all major firms doing well financially, McKelvey adds, untested change is not necessarily a welcome prospect.

Interestingly, Doug Black indicates that E&Y is rethinking its position on the importance of a merger. “Our thoughts about merger evolve all the time,” Black says. “We have always realized that bringing in 400 or 500 lawyers would make for a difficult acclimatization. Now that we’re at 115 or 120 lawyers—all business lawyers, no commercial litigators—we find that we are starting to be where we want to be and we wonder whether a merger will be necessary. Our goal is to be a leading continental law firm and we’re not sure how many lawyers we need in Canada to achieve that purpose. Take Davies, Ward & Beck in Toronto before they merged with Phillips Vineberg in Montreal. They were about our size. It may just be a question of bringing in the right individuals as the opportunity arises.”

It may also just be a matter of time. “Donahue will continue to build a very solid practice,” McKelvey says. “What they have won’t go away, and there is no reason for them to even think about giving up.” In other words, as Donahue demonstrates its staying power, the risk in joining the firm declines, and it becomes more attractive to the type of lawyer that can lift Donahue closer to the top.

As well, the relative lack of turnover at Donahue, notwithstanding the general queasiness about MDP culture in the profession, suggests that certain types of lawyers—junior and senior—fare very well in the structured environment of an MDP. “For me, it’s a more effective structure in that it’s very corporate,” says Black. “There are distinct processes in terms of client services and identification, marketing and sales. We run our business the way the clients run their business. The system assists me because it lets me deal with the wheat rather than the chaff by clearing away the distractions.” Graham B. Smith, a corporate lawyer who joined Donahue after 15 years at Smith Lyons LLP, expands on the point. Smith was drawn by the promise of an international platform and the “ground floor opportunity” of moving to an MDP. “We would fall short of the mark if we tried to replicate the cultures from which we came. That would miss, in part, the point of why we are here.”

It may also be that certain types of practice fit into the MDP template better than they do with traditional law firms. The MDP strategic vision has become more focused. Originally, accountants argued that multidisciplinary synergy (for example between tax, corporate finance and general corporate law) and increasing client demand for synoptic skills sets dictated the emergence of one-stop shopping that only global MDPs could provide. Now that experience has proved the accuracy of surveys and studies suggesting that one-stop shopping is more attractive to medium and smaller corporate clients, the strategic and marketing focus of the MDPs has shifted somewhat to align itself more closely with specific practice areas, in which one-stop shopping will appeal to even the largest clients, such as international structured finance, project finance, and asset-based lending.

According to Peter McKelvey, the real strength of the Big Five is in their cross-border referral potential, which he calls “scary,” and is matched by only a few law firms with global reach such as Clifford Chance or Baker & McKenzie. “If we get into a pattern where the MDPs in one country get on a deal and send the international aspects to their associated firms in other countries, the traditional law firms are going to see fewer deals,” McKelvey adds. The platforms from which MDPs now market themselves, therefore, focus on their international networks, integrated services and a high-quality domestic legal capability. In other words, their vision is continental and global, something Canada’s law firms are hard-pressed to match.

“The notion that Canadian firms with 500 lawyers are tier-one law firms is a misperception,” says Mark E. White, currently with Donahue as a structured finance specialist after a career as General Counsel to AT&T Capital Corp. in Canada and then in Europe, where he worked frequently with MDPs. “In global terms, Canada’s top law firms are mid-sized enterprises, but of sufficient size so that none of them are nimble enough to be a good fit with MDPs, which have the capacity to be top-tier global firms.” Thus Donahue does not measure its success against the domestic capability of Canadian law firms, but, rather against their international capability.

Asked about the failure of the Big Five to crack the top tier in the UK, White responds that “It’s much too early to make a judgment. Until we have a significant American and English presence, we’re not going to fully realize our potential, and it will take a generation before MDPs have developed inroads into the corporate client base the way the key law firms have done. But the important point is that we’re having a discussion about defining the professional services marketplace. In Canada at least, that kind of discussion was barely on the horizon as little as five years ago.”

As a former in-house counsel, White is convinced that there is a distinct advantage to professional services without boundaries. “Being an MDP allows us to come up with an overview of what’s going on in a particular industry,” he says. “That puts us one step ahead of traditional law firms in the professional services value chain, because the law firms alone don’t have the depth of resources or the reach that the Big Five have. We can create products, new ideas and opportunities, instead of just focusing on closing a deal. With those ideas, we can target companies that will make use of them, whether they be existing clients or new clients. We’re still talking about the delivery of legal services, but the goal is to use our industry experience to stay ahead of the client.”

White also says that clients are weary of “refereeing” between accountants, lawyers and investment bankers. “Clients focus on issues and opportunities. They don’t care if someone calls the problem an accounting or a tax or a commercial issue, so long as the problem gets solved. They want the deal done efficiently and are tired of advisors trying to shift risk onto each other and avoiding responsibility when the jigsaw puzzle doesn’t fit.” That’s why he is unfazed by McKee Nelson dropping the E&Y branding. “What will bind the alliance is that they going to market with Ernst & Young to service the same clients.”

If White is right—and there is a strong element of common sense in his reasoning—then the current litigation between Donahue and the Law Society of Upper Canada, from a purely business perspective, is an exercise in futility for the LSUC. On the other hand, Donahue has little to lose and very much to gain.

The litigation finds its origins in disciplinary proceedings taken by the LSUC against Donahue and Toronto Managing Partner Michael Thompson. The LSUC alleges that Donahue’s use of the E&Y name is in breach of professional conduct rules that prohibit law firms from using trade names. Donahue, it turns out, didn’t bother seeking permission from the Law Society when it changed its name from Donahue & Partners to include the E&Y branding. The firm simply issued a press release announcing the name change.

Donahue, represented by Peter Griffin of Lenczner Slaght Royce Smith Griffin, responded to the disciplinary action by initiating its own proceedings seeking a declaration that the professional conduct rules in question offend the Charter of Rights. By contrast, McKee Nelson took a conciliatory approach to the SEC and the New York State Bar Rules. “We’re not looking to make enemies,” said a lawyer close to the firm. “We don’t need Ernst & Young trademarks when we have the economics of business flowing between the law firm and the accounting firm.”

A close reading of the pleadings in the Ontario litigation, however, reveals that the stakes are considerably higher than Donahue’s use of the E&Y name. Griffin has challenged not only the constitutionality of the rule placing limits on firm names, but also the prohibition against fee splitting to the extent it prohibits profit-sharing. Currently, the law firm does not share profits with E&Y, Griffin pleads, “as a result of the interpretation placed on the Law Society upon Rule 2.08(9)(a).” But, he continues, to the extent the Rule prohibits profit sharing as well as fee splitting, it impairs freedom of association as guaranteed under the Charter.

In other words, as a result of the LSUC disciplinary proceeding, the entire issue of multidisciplinary partnerships is now squarely up for grabs. And, if the courts rule in favour of Donahue, the other Big Five firms may finally decide to enter the legal marketplace. Judicial sanction would also mitigate the uncertainty that has impaired Donahue’s recruiting and merger efforts to date. One wonders whether it is too late for the LSUC to avail itself of Senator George Aiken’s famous advice to US President Lyndon B. Johnson on how to get out of Vietnam, i.e. “Claim victory and retreat.”

“We have reached the end of the beginning,” says Doug Black. He’s right. MDPs are here to stay. They have challenges that will have to be met. But the challenges they face are probably no greater, and perhaps less worrisome, then the long-term challenge they themselves present to the traditional law firm model.

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Julius Melnitzer is a Toronto legal affairs writer.