First Six Years: Tech Lawyer Accelerator / Institute for the Future of Law Practice Alumni, 2014-2019

Our challenges will be solved by the next generation of legal professionals. We all become richer when we invest in them.

This pattern fits me and many lawyers I know: We applied to law school with a sincere, passionate personal statement about doing good. We worked hard to show we deserved our spot in the class. We focused on getting a job that enabled us to build our legal career while also paying back our loans and pursuing personal goals. Traction at work quickly led to long hours and growing responsibility. Then the years started flying by.

In the legal profession, we generally take care of our own careers first. And then, to the extent there’s time, energy, and resources left over, we help others. This is not a good formula for building and sustaining a vibrant profession. And frankly, it shows.  With a little bit of sacrifice and organization, however, we can do better. A good time to start is now.

The focus of today’s special three-post series is the Institute for the Future of Law Practice (IFLP, “I-flip”), an education nonprofit I have worked with since its origins as a pilot program at Colorado Law in 2014.  Post 117 shows how a group of general counsel connected to IFLP are stepping up to improve the legal supply chain. They are doing so by clearly stating what they want — more diversity, better training, less student debt — and encouraging their peers to join them. Post 118 is a data download on IFLP through Year 2, showing tremendous results on a remarkably lean budget. It also describes our plans for the coming year. Finally, Post 119 asks you to become part of the IFLP solution.

Here are three ways to do just that.

  1. Become an IFLP Patron. It’s tax deductible. Click here.
  2. Support the GC Open Letter on Improving the Legal Talent Supply Chain. You can do this by urging your general counsel colleagues to visit this webpage.
  3. Become an IFLP Employer, either for a 10-week summer internship or 7-month field placement. Click here.

For potential supporters who want a deep dive into IFLP’s strategic plan, please contact me directly.  Background on IFLP can be found in Posts 018, 043046, 064, 078, 112, and 118.  Today, however, I want to make the IFLP cause more concrete by focusing on the story of Dwayne Hermes, IFLP’s first official Patron who earned this distinction by accident and doing nothing more than living his professional values.

IFLP Patron 00001

Today is the first day of IFLP’s capital campaign. Any IFLP supporter who donates $20 or more will become an IFLP Patron and receive an official numbered IFLP Patron Card.  Into perpetuity, you’ll own that low single-digit, double-digit, or triple-digit number. However, the 00001 slot belongs to Dwayne Hermes, a lawyer who founded Hermes Law, a process-driven litigation firm in Dallas, Texas that employs a dozen-plus lawyers and nearly two dozen allied professionals, albeit everyone at Hermes Law, including Dwayne, goes by “team member.” In 2018, Hermes Law also became one of the first IFLP employers.

This past August, after Dwayne’s intern returned to law school, Dwayne reached out to make an unsolicited $5,000 donation to IFLP. When I replied that he was the first person to make a contribution to a capital campaign we were about to launch, he increased his contribution to $10,000.

I first met Dwayne in the winter of 2017 when Andy Morriss, then the Dean of Texas A&M Law, contacted me about a law firm he had just visited in Dallas that was unlike any other — heavy investments in data, process, and technology, a focus on cost accounting and alternative fees, and work space built for collaboration, including walls covered in whiteboard paint.

“This is the type of law firm that Susskind predicted,” said Andy. At the time, Legal Evolution was still in the planning stage. Thus, I was on the lookout for examples of successful innovation. When Andy said, “You should get on a plane and check this out,” I reached out to Dwayne and set up a visit.

More to the story

Andy’s description turned out to be accurate.  Yet, there was also a lot more to the story.

Prior to starting Hermes Law in 2015, Dwayne was a co-founder and partner in Hermes Sargent Bates, a litigation firm focused primarily on insurance defense. Over the course of nearly 15 years, the firm grew to nearly 100 lawyers and staff.  Yet, after nearly 30 years of practicing law, Dwayne went to his partners and told them he was tired of being in an antagonistic relationship with his clients.

“I suggested we move to a new business model that would open the door to better alignment,” Dwayne recounted. “We could reduce the total cost of a claim [payout + litigation cost] by reengineering how we did the work.”  Unfortunately, Dwayne’s partners weren’t interested.  Thus, rather than sign another lease, the partners decided to dissolve the firm.

“Think about that,” Dwayne told me. “I was the biggest rainmaker in a law firm I co-founded, and I was unable to make significant change.” Thus, after thirty years of practice, Dwayne founded Hermes Law with the goal of building a business model that would enable all stakeholders — clients, lawyers, staff — to feel that they were all part of the same team.

When I visited Dwayne and his team in February 2017, the firm was still in building mode. Thus, it was not yet clear whether clients would embrace (or embrace fast enough) this new model. Obviously, Dwayne was taking an enormous financial risk.

To better assess the viability of the model, I worked my rolodex to find two senior lawyers in insurance companies who managed claims litigation. I asked them for an in-person meeting to introduce them to Dwayne and get their reaction to his new model. (When it comes to studying innovation, the goal is often to get into the right room so you can watch and listen.)

In the first meeting, my in-house colleague revealed that he was working hard to drive the same model from the insurance side. However, not all lawyers and law firms understood his “blue ocean” strategy. Although my friend and Dwayne got along famously, my friend did not have much claims work in Texas.  In the second meeting, my in-house colleague had just left the insurance company due to a change in senior management.  He claimed that Dwayne’s model was the type of innovation he long wanted to support, but that the internal apparatus favored driving down litigation costs by pitting staff counsel against law firms.  “Our management thinking was archaic. We made it impossible to innovate.”

Through these two meetings, Dwayne became a member of the Last Miler’s Club.  These are legal innovators who have the technological know-how to solve a major problem for their clients, yet they struggle to find a business model that enables them to transition. See Post 072 (discussing Last Miler’s Club); Henderson, “The Legal Profession’s ‘Last Mile Problem,'”, May 26, 2017.

Likewise, after these meetings, it became obvious to me that Dwayne needed to go out and find the handful of early adopters within insurance companies who were willing to have a sophisticated conversation about risk and reward.

Could Dwayne get it done before his team in Dallas ran out of steam? Although I certainly hoped so, there were no guarantees.  Over the last two years, I’d periodically get updates from Dwayne, particularly as he tried to sell his vision and model to underwriters in London, who are some of the most significant opinion leaders within the insurance bar.

Then, in December of 2018, I got an email from Dwayne with the subject line, “The first Crossing of the Chasm” [a reference to Post 024]. The email read, “It happened Wed night with the formal signing of the Swain & Baldwin Value Pricing Agreement (photo attached) and then continued at a greater speed with the meeting yesterday with [a Top 3 insurer] who wants to send us as much work as we can handle.  … Champagne was popped.”

Dwayne went on to comment about the challenge of scaling the business. “Maybe we are at the end of the half marathon with half to go.”

The next generation

One of the things that stuck with me about my first meeting with Dwayne was his comment, “I want to leave this profession stronger than I found it.” If he couldn’t do that, he was going to find something else to do with the productive years he had left.

Personally, I am inspired by Dwayne, first for taking enormous personal risk to improve the practice of law and the legal profession, and second by investing some of the rewards back into the next generation. I hope readers will consider doing the same. If just a few hundred of us stand up and support IFLP, we’ll have a solution for next generation (and perhaps for us) that just might work. In the meantime, we can share the joy of living our professional values.

To become an IFLP Patron and receive your IFLP Patron Card, please visit our Support IFLP page.

Many thanks for reading. wdh.