Having been the keynote speaker at the 2020 Legal Geek conference and a leading light in the US Legal Market, as I sat down with Boris Feldman, Head of U.S. Technology Practice at Freshfields Bruckhaus Deringer, I knew that I was in for a treat. Not only did I find that he was an extremely kind and engaging man, but one whose wealth of experience in Silicon Valley can undoubtedly help change the legal sector here in the UK.

Thank you for joining us Boris… Let’s start by finding out a little bit about yourself?

I live in Palo Alto, California. I moved out here when I got married and my wife was going to start law school here. That was in 1986, 34 years ago. After a month, I said I’m never leaving. Not only did I love the personal environment in California, but the legal environment and the opportunities it provided were extraordinary.

I’ve lived and worked through multiple boom-bust cycles and total transitions in the technology here. Just as the Valley keeps reinventing itself, for somebody whose work is a derivative of the Valley, you must keep reinventing yourself too.

So, having worked in Silicon Valley for over thirty years, how has the legal world changed since you entered the market?

Oh, there are so many ways. One of the most tangible changes is that being a lawyer is now a 24/7 job. When I began practising in Washington, there were faxes and I guess E-mail was just starting to take off. You might work late at the office or even take a brief home to read, but essentially there was a separation between work and non-work time, sort of like in the Book of Genesis when God divided the firmament – the heavens from the waters below.

With technology, that all started to change. Mobile phones were probably the biggest development in the history of the legal profession because clients could then call you at any time. The Blackberry changed the game again because clients could then email you at any time. And now we are where we are – the ability to instantly message through a wide variety of apps available. It’s not farcical to say that clients really do expect constant instant availability from their lawyers, especially when you layer on top of that the icing of the lockdowns that we are all going through.

For me, there’s now no separation between the heavens and the waters below.

At home, we’re all on call, all the time. You may be having dinner and you hear a ping in the other room and so you go to check your messages. I feel that one of the things that’s happened, and has definitely been accelerated by Covid, is that the home is no longer a sanctuary at all. That’s very true in the legal profession, but my guess is you could go profession by profession and see it in one after another.

So, in my opinion, one of the great changes in the years I’ve practiced has been the importance to one’s career of constant availability and the difficulty of turning it off.

 And on a human level, do you see that as a bad thing or are you happy with that?

It’s too early to say. We’re in the midst of it and it’s still evolving. Some of the tech companies have already said their employees can work from home forever. Some of them are going to a three at home, two in the office split etc. So I feel we don’t know yet how it’ll play out. There’s a chance that post-lockdown, businesses and law firms will conclude that this phenomenon is actually bad, that a lot of the creativity that comes from being in a group with other folks is lost when you’re just doing it over a computer screen. It’s also possible that the long-term burnout effects of not having a separation between work and home will be so negative on people, that companies will say, OK, you have to start coming back into the office. I don’t think we can tell yet.

On the one hand, there’s no question that it takes a toll on the soul – not to be able to walk out of the office and go home and just be home. On the other hand, it’s somewhat of a spoilt perspective to say that because we’ve kept our jobs and continue to get pay cheques. Whereas people who otherwise would have gone into a factory, punched the time card, left at five o’clock, punched out and gone home, they haven’t had work to do during the lockdown. So, it’s an unfortunate situation, but financially probably a fortunate situation.

 With this cultural change you speak of in the way we work, has the US legal market been affected by the global pandemic?

I think that the U.S. legal market has been relatively unaffected by the lockdown and the pandemic. There were already megatrends underway in the legal market here, sort of a segmentation of the market. Instead of looking at a normal bell-shaped curve for law firms and how they perform here, it’s really become more like a two humped camel. On one hump, let’s say the one to the right, is the elite firms that are national, global, high value services. They’re financially strong with distinctive business models that have high profitability.

Though not a size issue because some of them can be quite large, the hump to the left tends to be firms where it’s hard to identify what their role in the market is – they don’t have a strong identity. I think, for example, there are many firms in the US that were strong, localised players, the top firm in the city so to speak, and had very high quality.

Then over the years, they decided, well, we can’t just be the king of this town. So, they went on acquisition and merger strategies around the US, sometimes internationally, to build out and grow in size and revenue. However, there’s not an underlying rationale for that firm and because they’ve reached a particular size, they must continue to feed the beast. Volume is very important for them and they tend to get into large scale commoditised work.

So, I think we’re going to see that megatrend continuing. Those distinctive elite firms in the US and globally that have something distinctive to sell to clients, will continue to thrive. For the rest of the legal market here, I feel it’s going to be tough going, which is why I think the reaction (I could be totally wrong, I’m just speculating) among many firms in that leftward hump of the camel will be, well, we’ve got to merge our way out of it.

I believe that we may see a wave of consolidations, not just among smaller firms, where it might be 100 or 200 lawyer firms combining, but instead firms that have followed a consolidation strategy to get to 1000 or 1500 lawyers. I think more and more of them will join together in hopes of migrating from the left hump to the right hump.

Would you say those firms in Silicon Valley are on that right-hand hump then? Can Silicon Valley be a catalyst for change in the US legal profession?

Generally, yes. The legal practice in the Valley has always been different from the legal practice in New York or London. It’s been much more ‘delivery’ oriented. One thing that was always true of tech companies here from the time they really started to become significant in the late 70s, early 80s, is that they wanted to spend their money on development – they didn’t want to spend money on lawyers. Their favoured interaction with the legal market was in raising capital and they were all about getting deals done.

Every lawyer who’s worked in the valley can give you multiple anecdotes about deals in which fancy M&A lawyers from other areas were more focused on winning a point in the deal negotiation than they were in getting the deal done. Historically, that’s why the law firms in Silicon Valley were able to keep outside firms from getting much traction here.

I think over time, the very best law firms outside the area learned that to thrive here, they were going to have to adapt to the Silicon Valley way of doing business and the market here has opened up over time to them. There remains a distinctive Silicon Valley way of lawyering, but some others outside the area, have accepted that and learned how to practice in that way.

I don’t think that the valley’s impact on the legal profession is from a technology standpoint though. I think if you were to do sort of McKinsey-like assessment of technology changes in the legal profession, I don’t think they’ve been that important. Will AI make a difference? Maybe in some areas, maybe in commoditised areas, but not in high- value add areas.

To me, the major impact of the tech industry on the legal profession, has been the change in focus from winning a blue ribbon for best in show, for let’s say, a merger agreement, to a new focus of satisfying the business needs of the client. In that way, yes, Silicon Valley can be at the forefront of change.

That’s very interesting you say that… I’d like to turn your attention to your keynote speech for Legal Geek. You explored the concepts of job mobility and risk tolerance, so please explain to our readers why you believe the interaction between the two can be hugely beneficial to the legal sector?

Three words – Why Silicon Valley? Why did it happen here? If you landed from Mars and you wanted to understand the global technology movement, you’d be surprised that it was in California. If we were exploring the wine industry, then OK! Good climate, good soil, good lifestyle. But the legal profession?! Why here as opposed to other cities?

There are other cities that one might have thought could have become Silicon Valley. Pittsburgh, Pennsylvania, would have been a great candidate. Carnegie Mellon is a great engineering university and there’s a huge labour force from the steel mills…

Cleveland, Ohio, which again has a great engineering university in Case Western Reserve. It’s a big city, on a lake, lots of transportation hubs going through it…

You might have said Champaign Urbana, where the University of Illinois is and the Web browser was invented – Chicago is nearby, it’s at the centre of the country, lots of experienced employees…

None of those really became an important hub for technology. They all had pieces of it yes, but they didn’t dominate it.

Many sociologists and business anthropologists have tried to say, why here, why Silicon Valley? Some people have recognised two factors. From my own perspective, these two factors have a feedback loop between them.

One factor that I think is widely acknowledged, is the strong California policy outlawing covenants ‘not-to-compete’. What this means is – let’s say you’re working at Charlton Grant today and tomorrow you decide, I’d rather go work for another legal publication. Normally you may have something in your employment agreement that says, OK, if you leave us, you can’t go work for another legal publication for a year.

In most of the world, those contracts are valid and enforced, but in California for well over a hundred years, there are void as against public policy and outlawed by statute.

That has been a key factor in why the valley has been so successful. There’s great fluidity of talent between companies. So even though you can’t take the trade secrets with you, you can take your brain with you.

In California you have a right to go. People take their accumulated knowledge and their ideas and when there’s a hot new idea, instead of being bottled up within one company like a genie, the cork is pulled out when they go across the street. This has meant that the impact of worker mobility on innovation has been huge.

A second factor that people have commented on in the success of the Valley, is that failure here is viewed as an experience, not a disqualification. I once represented someone at a company in Ohio that had a financial restatement, an S.E.C. investigation, shareholder lawsuits and finally went bankrupt. He told me he was going to have to move out of Ohio. I asked him why and he said ‘My company went bankrupt. No one will ever hire me here again.’

However, if this were to happen in Silicon Valley, for his next job the CEO would have looked at his CV and said, ‘wow, for somebody so young, you’ve been through an IPO, a restatement, S.E.C. investigation, securities litigation and bankruptcy – it’s as if you’re 20 years older than you actually are – what great value you bring.’

In Silicon Valley, there are many famous individuals, people who have been CFOs at companies where they had innumerable failures and yet their experiences are deemed highly valuable by future employers. That’s not true in much of the world.

There are entire countries where if you were at a company that went bankrupt, you’re finished. People just won’t trust you again. So, to the extent that I see anything novel between the two, it’s that they affect each other. I believe that the tolerance for risk here is not just because people are surfers or rock climbers on the weekend, but because you’re more willing to accept a higher degree of risk and innovate more, even though it might fail.

If you’re working at an industrial enterprise and you know that if you screw up your job, you’re still stuck there and you can’t go across the street, then you’re not going to take as much risk because this is it until the day you retire and you get a gold watch. Whereas if you say, hey, I’m willing to try this, maybe it’ll work, maybe this new device will be a hit, but if it doesn’t work, there are 20 other companies I can go to – you’re much more likely to take that risk.

I really do believe that job mobility may have enhanced the willingness of employees here to take risk.

Yeah, I completely agree… So, with this in mind, how can the legal profession build a culture that embraces innovation and disruption in order to improve delivery to clients in an ever increasingly connected world?

We just did. Most law firms switched from everybody coming into the office and collecting hours like eggs in the henhouse. They switched in a matter of weeks to everybody being distributed. In the law firm technology world, I think people will look back for many years and marvel at the transition.

There were law firms that I knew of where lawyers were not supposed to work on firm documents on an airplane because it was viewed as a security threat. Others where people weren’t supposed to take their laptop home or weren’t supposed to hook into the work system from their home computer. That all went out the window by about April 2020.

I feel we’ve been through that now and then the question is what will go back and what won’t? The old days of getting on a ‘plane to fly very far away, to do a two-hour witness interview – that’s probably not going to happen very often.

The notion that you can only make a presentation to a potential client to get a mandate in person, is probably gone. For those lawyers who had a social business development plan, lots of dinners, lots of golf, maybe that’ll come back, maybe not. I think that on the client side, they’re going to be much more jealous of their time and that on every interaction, the question for them will be, why do we need to do this in person? Why do we need to schedule a half day visit for this? Why can’t we do an hour over Google Meet?

That major shift occurred faster than anyone would ever have imagined. People including myself, often give law firm I.T. folks a hard time. Yet, as an industry, the rapidity of their transition to work from home was astonishing. You don’t really hear a lot of horror stories about it. If you talk to friends at other firms, by and large, they say, yeah, our IT group did an incredible job of getting everybody equipment at home, getting them hooked in, and it worked pretty well.

Boris Feldman is Head of U.S. Technology Practice at Freshfields Bruckhaus Deringer