Starting your own law firm can be a daunting prospect for even the most experienced attorneys. There are a multitude of significant considerations: how to handle the departure from your current firm, who to bring with you, how to manage the impact on your clients. There are so many components to consider that some lawyers never progress beyond a mere contemplation of their dream to be on their own.
While there is no limit to the information immediately available to us in today’s era of endless technology, there is no substitute for firsthand experience. Regina Calcaterra, Esq., founding partner of Calcaterra Pollack LLP, is the ideal person to advise other attorneys on what it takes to venture out on your own. Regina carries an impressive list of accolades—she specializes in complex federal and state litigation representing public entities, labor, health and welfare funds, businesses and individuals.
Prior to founding her own firm, Regina was a named partner at two securities and consumer class action litigation firms over the course of twelve years. Beyond her impressive legal resume, Regina is a New York Times best-selling author and has held several New York state and county senior executive positions in public service.
Calcaterra Pollack specializes in the representation of aggregate and individual clients in several areas of complex litigation, including class actions. The firm focuses on consumer protection, antitrust, shareholder/investor protection and social justice matters, as well as representation of municipal governments. The firm’s partners have over five decades of collective experience, having litigated dozens of class actions, securing several hundreds of millions of dollars in recoveries for clients.
We had the privilege of speaking with Regina about her career and the challenges of “spinning off” to form her own firm.
Regina opened the doors to her own firm on April 2, 2020 during the height of the pandemic and later changed the name to Calcaterra Pollack LLP once her co-founder, Janine Pollack, joined the firm. However, Regina’s planning for her firm’s initial launch began in February 2020 as she contemplated opening her own shop. She believes that learning from the experiences of other attorneys who have undertaken a similar venture is an extremely useful tool. Here is her advice:
“I suggest having conversations with [other] law firm founders that have firms around your anticipated size and who formed their firms within the past few years. The guidance I received from my peers was invaluable and helped to identify almost every task that needed to be executed throughout the first weeks and early months of my firm’s formation. Since I had never run my own law firm, I also needed to learn how my peers tackled the financing aspect of a start-up plaintiffs’ firm. It was then that I first learned about Counsel Financial, so I called and spoke with one of their founders and we discussed potential options. Finding the right form of financing is a crucial step in starting your own law firm and what I learned is that there are many different options available to plaintiffs’ firms. Finding a funder who understands the nature of your practice is key.”
On working with Counsel Financial, Regina recounted:
“[While] working with the team at Counsel Financial, I learned how to assign value to my own cases, which ultimately served to reinforce what my value is not only as a litigator but also as a matter and client generator. Although the journey of launching my firm was intense, the unwavering support of the Counsel Financial team served extraordinarily helpful as they have assisted many successful firms in the plaintiff’s bar in starting out. What I thought to be one of the most challenging aspects of launching a firm, ended up being a seamless process.
Deciding on how to structure your new firm is a difficult decision to make. As is the choice of whether to take on partners or branch out on your own. Here are Regina’s thoughts on firm structure:
“I knew from the beginning that I would prefer to form a partnership, which I have now done with my friend and law partner Janine Pollack, whom I used to work with at my prior firm. But I believe that this is one of the first things you must consider when starting up a law firm. Are you going to have one or more partners or go it alone? Once that important question is determined, you can decide whether a PC, LLC or LLP is preferable based upon tax consequences and corresponding statutory, regulatory and bar association guidelines.”
Regina advised that in addition to a corporate structure, one must consider the best area of practice to focus on; fee structures (hourly or contingent fees, or both); and the number of associate attorneys and other support staff who share the same entrepreneurial spirit. In fact, Regina recommended that serious thought be given to “who you’d like in the foxhole with you.”
She recalled, “When I was considering starting my own firm, I looked around at four talented young people and realized I didn’t want to lose them, so I asked them to come with me. My team had to prepare for leaving our previous firm and then launching our new firm all in the midst of a global pandemic. We basically divided up everything that needed to be done—not only importing clients over, securing new retainer agreements and obtaining substitutions of counsel, but also putting together every aspect of the firm from opening a bank account to getting insurance and setting up payroll. We had to work on all these aspects of running a firm—which we had never done before—while litigating [at the same time].”
Regina also cautioned that constructing a detailed budget projecting income and expenses is vital when attempting to steer your firm to success.
She said, “I built my budget around payroll, benefits and insurance such as malpractice, disability, general business liability, workers compensation, unemployment and cyber insurance. After those considerations, you need to build in the costs of the logistics of practicing, such as case costs, email software, cloud document management and case management software, legal research services, legal publications, associations, court fees and other expenses. Early on, you will also need to include start-up costs for such basic things as office furniture, printers, technology and phones. One of the largest costs of starting your firm will likely be the lease of your offices.”
Departing from your current firm to start your own must be handled correctly. The legal community is close knit and you don’t want to burn bridges, no matter what the situation. Regina offers this advice:
“Although exciting, the transition will have its stress points so it’s always best to keep your clients’ best interests in the forefront of your mind. You never want the short-term challenges of your current situation to have a long-term impact on the client and/or the unwavering representation they deserve.”
The COVID-19 pandemic changed everyone’s lives and the way we do business. In the midst of it all, Regina pressed on to open her own firm. Here’s what she has to say about opening and running a new firm in the middle of a pandemic:
“We are all working remotely at this time, so we had to build in the costs of setting up equipment at everyone’s homes, such as printers and scanners. And since the firm began right in the midst of the stay-at-home orders, we haven’t had the opportunity to move into a brick and mortar office. On the one hand, that has saved us the significant cost of rent, but on the other hand this has inhibited our ability to have in-person staff meetings and the face-to-face contact that we have grown to expect in a traditional law firm setting. However, I’ve made it a priority to speak constantly to my firm as a team.”
She continued, “I believe our communication flow is what has helped us the most during our launch—particularly in the midst of this pandemic—because we are all experiencing this together. Every morning, we hold a firm-wide meeting where each team member shares how their family and they are doing, what they worked on the day before, any pending issues that need to be addressed and what their marks are for the upcoming day. It’s better having these calls as an entire team so all firm members see how everything they do contributes to the greater effort. If we did not have firm wide calls, we would end up with team members that are unaware of how their work product impacts others as compared to understanding the entire paradigm. If you’re explaining exactly what needs to be done, and why, to all those involved at the same time, work flow is more effective and efficient. None of us really knew how to build a law firm before and we did this in unprecedented times. Now, we have almost completed the start-up phase and all the lawyers and professional staff are working seamlessly, together. I believe that we are definitely on the path to great success for our clients and the firm."
Informing your clients that you are leaving your current firm is imperative and sometimes difficult. Regina shares her views on this dilemma:
“It’s important to remember that clients choose who they retain, not the other way around. Prior to contacting the client, you should put your firm on notice that you are leaving and work together with your [current] firm to develop a flexible plan on how to inform the clients of your departure and their opportunity to select the counsel of their choice. Just this past December, the ABA’s Standing Committee on Ethics and Professional Responsibility issued Formal Opinion 489, which provides guidance on both the firm’s and attorney’s obligations when it comes to an attorney’s departure. Such guidelines indicate that both the firm and the departing attorney have an ethical duty to develop a plan that “protects client interests during the lawyer’s transition.”
Starting your own firm presents significant risk, but also offers the prospect of excellent rewards. Careful planning is critical to your success. Building your network of support in large part, whether it’s the attorneys and staff or the legal vendors, requires careful and strategic decision-making. As Regina has made evident, staying clear and focused, as well as identifying likely obstacles, allows you to set forth to achieve your goals.
Counsel Financial provides working capital credit lines exclusively for the plaintiffs' bar in all states except California, where credit lines are issued by California Attorney Lending.