A law firm with a lot of patterns... We must be wary of ‘separate production system’

Former form of ‘network law firm’, in effect a lawyer’s private office
In the throes of industry reorganization... The damage falls entirely on the legal consumer.
Legal community: “We need to eradicate the publicity that suggests an organized response is possible.”

One of the emerging topics in the legal world recently is ‘network law firms.’ This is because it is the only one showing rapid growth in the stagnant legal market. Daeryun and YK are considered leaders in network law firms.

YK solidified its position as a large law firm last year, recording sales of more than 150 billion won. Last year, Daeryun also surpassed 100 billion won in sales just 9 years after its establishment, entering the top 10 law firms with the shortest history.

Network law firms mainly advocate a ‘one-firm system.’ Although we have branch offices in various regions across the country, all matters related to the operation of the law firm are collectively managed by the main office. Profit is also shared by all members in a certain ratio. They are also active in marketing, investing a considerable amount of money in advertising costs. Therefore, criticism is being raised within the industry that these law firms are sweeping away all cases in small regions.

Before the emergence of network law firms, so-called ‘separate law firms’ were making waves in the industry. The separate accounting system operates in such a way that each lawyer, even if affiliated with the same law firm, receives profits as if he or she were an independent sole proprietor.

In fact, it can be seen as close to a private office as only common expenses such as office rent and employee wages are borne together. Cases are also handled individually by each office. It is pointed out that in Korea, the term network law firm is used without a clear definition, and in practice even separate law firms are recognized as the same category, which may pose unnecessary risks to customers.

An official from a network law firm said, “The Korean legal community still lacks understanding of the structure of a global law firm, and some law firms call themselves a network with only 2-3 branch offices and online advertisements, and in fact operate in a separate system.” He added, “Only a very small number of firms have established a global mega law firm-type structure that can diagnose and allocate cases centered on the main office and control quality at a national level. Each branch office across the country has different quality. “The separate system for providing services is the biggest risk from the customer’s perspective,” he explained.

In reality, separate law firms are not free from the problem of poor management. Contrary to the appearance of a prosperous law firm, in reality, it is run by individual lawyers handling the cases they take on alone. This is why there are concerns that the absence of a case management and collaboration system may lead to a decline in the quality of legal services.

There are also cases that clearly demonstrate the problems of separate law firms. This is the so-called ‘trial no-show case’, which became controversial when a lawyer who worked at Byeolsanje Law Firm failed to attend the trial after serving as legal representative for the family of a school violence victim. The victim's family received a partial ruling in favor of the case in the first trial, but due to the lawyer's continued non-appearance, the result was eventually overturned as a 'lost' case in the appeals court.

As the case became controversial, the law firm that the lawyer was affiliated with quickly tried to draw a line by issuing a statement and saying, “The lawyer in question has withdrawn from the main office and has absolutely nothing to do with our branch office.”

In the end, some point out that the damage caused by this law firm operation is borne entirely by the customer. An official in the legal industry said, “It would be absurd from a legal consumer’s perspective if the place they went to expecting high-quality service actually had less of a system than a private office.”

He went on to say, “As related disputes are increasing, there is a need for internal self-purification within the industry,” adding, “It appears that sanctions will be needed for behavior that deceives consumers by claiming that an organized response is possible despite the separate production system.”

Reporter Park Jae-gwan (paksunbi@fnnews.com)

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A law firm with a pattern that is mushrooming... We must be wary of ‘Byulsanje’ (Shortcut)