ILNews

Tough times drive change

Michael W. Hoskins
November 12, 2008
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Economic Impact

This is the first article in a series about Indiana's legal community and the turbulent economy.

Indiana's recreational vehicle industry has seen better days - thousands of workers have lost their jobs, manufacturers and dealers are shutting doors, sales have plummeted, and consumers just aren't buying the fuel-hungry road giants anymore.

But just because an industry is struggling doesn't mean the attorneys practicing in that area of law are feeling the same pain. Attorneys representing clients in the economically battered RV industry aren't seeing those layoffs and downturns trickle into their worlds, but instead are adapting to new types of work coming their way as a result. It's a trend that shows just how capable the Hoosier legal community is in evolving as the economy falters and impacts their practice areas.

Let the RV industry and its attorneys tell that story.
Brotherson

"There's no way to sugarcoat this â?¦ it's a stressful time, just like it is in so many industries right now," said partner Jim Brotherson, who works in the RV Focus group at the South Bend office of Baker & Daniels. "We've thought about this a lot, the extra amount of work we're being called to do by clients that is because of the current economic conditions."

Those figures aren't pretty for northern Indiana, known as the RV capital that makes more of the vehicles than anywhere else in the country. The bleak picture is caused by a national slump in sales resulting from high fuel and commodities prices, as well as the more recent financial crisis that's limited resources and prevented people from being able to buy the travel trailers. About 3,000 job cuts have slammed the region and driven up the unemployment rate significantly, and several suppliers and dealers that have existed for decades have had to close.

This ecomomy is a new variableEconomists predict a rough economy overall for Indiana next year, a direct result of the housing market crash, financial sector meltdown, and rising energy prices. The state has seen five consecutive months of job losses, the longest streak since employment hit bottom in summer 2003, and statewide unemployment is approaching 7 percent.

For the legal world, impacts vary depending on the type of practice. Attorneys handling intellectual property, international, and employment law are seeing more business as companies shift their focuses to those areas, even as bankruptcy and foreclosure lawyers are seeing a wave of business as more filings materialize in the faltering economy. Simultaneously, areas such as corporate and small business, construction, and banking law are struggling as those focuses aren't as hot on the list as they are during better economic times.

"Whenever the economy goes in the tank as it recently has, workers who have been fired, laid off, or otherwise find themselves unemployed or underemployed seem to be more willing to seek out lawyers to pursue employment-related claims against their employers or former employers," said William Groth, a partner at Indianapolis-based Fillenwarth Dennerline Groth & Towe.

Those practicing in the RV arena seem to represent what's happening throughout the legal community as far as practice Tannergroups' ups and downs. Baker & Daniels formed its RV Focus group two years ago, and now more than 40 attorneys coordinate their respective expertise in varying areas of law, working with the 16 who regularly work in that group. Despite the economic downturn, the firm has more than doubled the number of attorneys handling those types of issues specific to the troubled RV industry, Brotherson and his colleagues say.

"We've seen downturns like this through the decades, though we haven't seen anything like this since the late 80s," said Baker & Daniels attorney Ken Weaver in South Bend, who has been working in this area for four decades and is past chairman of the Recreational Vehicle Industry Association. "Each time, the volume of legal work doesn't change much or it does go up some, but the nature of the work changes."

WeaverWeaver remembers how some companies shrunk from 2,500 to 400 employees in a few months back in the 1970s after the fuel shortage, but it recovered. He knows it will again, the same as other areas being slammed at the moment.

Prior to the economic and financial crisis, the RV industry saw higher sales because of consumers wanting to buy vacation vehicles, the attorneys said. Preventing litigation and handling corporate law issues were common functions, as well as knowing transportation and industry-specific manufacturing or safety law.

Companies continue to be proactive and prevent litigation, according to Joe Tanner in Indianapolis, a part of the Baker & Daniels practice group. He's being called more to polish up documents in order to avoid litigation, and companies want to re-examine warranty and dealer or supplier documents for warranty claims because of the economic uncertainties. Excess capacity is being squeezed out because consumers are buying fewer vehicles, and industry leaders are dealing with that issue.

RV attorneys are counseling more clients about federal notice laws about what's required when making sharp cutbacks and layoffs, Brotherson said. He's been at the table for manufacturer and industry closings, and he said the topic has come up often. One company had to layoff some sales representatives and another wanted to strengthen its administrative and sales areas, so the latter was able to sweep up that talent leaving the first company, he said.

"That kind of change in employment relationships is one that wouldn't have happened outside the current economic situation," he said. "What doesn't make the news is the supplier that has to lay off 10 people, and while it's not a huge newsmaker, it still means we're doing the legal work."

A key issue in recent years has been more focus on fuel efficiency because of rising oil costs, something that was compounded with the no way to sugar coateconomics in the past year. Now, that's become an even more important task combining various areas of the law and one that may offer a glimpse of what's to come for the industry as a whole, attorneys say.

"A huge premium on innovation has been born not just because of the economic malaise, but also because of a general concern about the price of fuel and availability," said Steve Hazelrigg in Fort Wayne. "That fuel aspect would be going on even without the economic situation right now, but this all has presented an opportunity for the industry to innovate to make RVs more fuel efficient."

HazelrigFor example, the industry is looking more closely at European manufacturers and improving relations with those RV makers, dealers, and suppliers overseas. Hazelrigg pointed out the smallest U.S. RVs are twice the size of the largest ones produced in Europe.

"We may see lighter products in the future because that's what consumers can afford to fill up with gas," he said. "From the supplier side, we see them struggling to invent stronger component parts to create the better fuel efficiency."

The attorneys have recruited colleagues with international law and global experience, something that didn't happen when the Baker & Daniels practice group first materialized, the attorneys say. The regular RV attorneys have been working more closely with intellectual property lawyers because of the economic troubles, they say. As layoffs happen and manufacturers and suppliers struggle to cut costs and stay afloat, more creative products are being contemplated and those ideas face a higher risk of being stolen by competitors.
 
All show how the practice group is adapting to the changes and reaching more deeply into the law firm's expertise to provide services that are needed. With history on their side, the RV attorneys are confident the industry and their practices will survive.

"The industry has been through this before, and we've always come through stronger and better," Tanner said. "This economy is a new variable, and when you have those variables, it ignites creativity among people. When you have people thinking creatively, it creates better legal work from us. That's what we like to do, so ultimately this creates a good environment to do our business."

Brotherson said he expects that in the next year there will be an increased demand for RV lawyers, as well as attorneys specializing in other hard-hit industries and fields.

"That's simply a function of the general tumult in the national economy," he said. "There's no question in my mind that that our industry will recover, and I'd be shocked if it looked like it does today. I'm not sure what it may look like, but because of all this, the lawyers must be at the table and helping with whatever guidance our clients need."

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  1. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

  2. "Meanwhile small- and mid-size firms are getting squeezed and likely will not survive unless they become a boutique firm." I've been a business attorney in small, and now mid-size firm for over 30 years, and for over 30 years legal consultants have been preaching this exact same mantra of impending doom for small and mid-sized firms -- verbatim. This claim apparently helps them gin up merger opportunities from smaller firms who become convinced that they need to become larger overnight. The claim that large corporations are interested in cost-saving and efficiency has likewise been preached for decades, and is likewise bunk. If large corporations had any real interest in saving money they wouldn't use large law firms whose rates are substantially higher than those of high-quality mid-sized firms.

  3. The family is the foundation of all human government. That is the Grand Design. Modern governments throw off this Design and make bureaucratic war against the family, as does Hollywood and cultural elitists such as third wave feminists. Since WWII we have been on a ship of fools that way, with both the elite and government and their social engineering hacks relentlessly attacking the very foundation of social order. And their success? See it in the streets of Fergusson, on the food stamp doles (mostly broken families)and in the above article. Reject the Grand Design for true social function, enter the Glorious State to manage social dysfunction. Our Brave New World will be a prison camp, and we will welcome it as the only way to manage given the anarchy without it.

  4. When I hear 'Juvenile Lawyer' I think of an attorney helping a high school aged kid through the court system for a poor decision; like smashing mailboxes. Thank you for opening up my eyes to the bigger picture of the need for juvenile attorneys. It made me sad, but also fascinated, when it was explained, in the sixth paragraph, that parents making poor decisions (such as drug abuse) can cause situations where children need legal representation and aid from a lawyer.

  5. Some in the Hoosier legal elite consider this prayer recommended by the AG seditious, not to mention the Saint who pledged loyalty to God over King and went to the axe for so doing: "Thomas More, counselor of law and statesman of integrity, merry martyr and most human of saints: Pray that, for the glory of God and in the pursuit of His justice, I may be trustworthy with confidences, keen in study, accurate in analysis, correct in conclusion, able in argument, loyal to clients, honest with all, courteous to adversaries, ever attentive to conscience. Sit with me at my desk and listen with me to my clients' tales. Read with me in my library and stand always beside me so that today I shall not, to win a point, lose my soul. Pray that my family may find in me what yours found in you: friendship and courage, cheerfulness and charity, diligence in duties, counsel in adversity, patience in pain—their good servant, and God's first. Amen."

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