Black law firms seek a corporate clientele THE BUSINESS OF LAW

THE BALTIMORE EVENING SUN

The law partners of Brown, Alston & Byrd are facing difficult odds.

The firm is less than a month old. Economic times are hard, and building a base of clients that will pay retainer fees needed to sustain a practice is tough for any start-up.

As black lawyers they are attempting to break new ground by primarily serving businesses. Traditionally, black law firms have focused their practices on criminal law and civil matters such as personal injury, civil rights, workers compensation and domestic cases.

But the trio feel they've got the right stuff.

"I had always dreamed of starting a minority law firm," said Charles G. Byrd. "We all kicked it around."

In fact, the idea developed while the partners were attending law school at the University of Baltimore. Byrd said they all knew they wanted to be entrepreneurs.

After the three graduated from law school in 1987, they worked in two of Baltimore's largest law firms. Byrd and Benfred A. Alston worked as associates with Venable, Baetjer and Howard. Dwayne A. Brown worked as an associate with Miles & Stockbridge.

Brown, Alston and Byrd feel they can fill a void by concentrating on commercial litigation, representing insurers and handling maritime law. Brown said he and his partners hope to add between 15 and 20 lawyers in the next five years catering to small to medium-sized businesses.

Other black attorneys in town say they wish the partners well and have nothing but praise for their decision to build a business clientele. But they say solemnly that the three face a battle that is often lost by black firms.

"Black lawyers traditionally have not been able to depend on retainer clients. Often insurance companies and banks don't give us their business," said Norris C. Ramsey, a black attorney in Baltimore. "Many black law firms fail or have difficulty surviving."

At the peak of his practice last year, Ramsey said he had four lawyers working for him. But because of the recession he had to reduce his staff to one full-time associate and another who works part-time.

Jean S. Fugett, an ex-NFL football player, tried to focus his practice on finance and entertainment law. He opened his law firm in 1987 and dissolved it two years later. Fugett said he felt he had the experience. He had worked in New York with his brother, Reginald Lewis, who in 1987 bought Beatrice International Food Co. in a $985 million leveraged buyout, making the company the largest black-owned business in the United States.

But Fugett said even with his Wall Street experience, his firm wasn't able to bring in big business clients on retainer.

At Middleton, Waters & Shavers, the four partners say the firm has done well in its two-and-a-half years, but business clients generally come to them to handle single issues or by way of joint ventures with white-owned firms.

The partners at both Middleton, Waters and Brown, Alston see the potential in reaching out to black businesses.

"I think there is a need for minority law firms," said Wendy Patrice Arnell of Middleton, Waters. "We need to be able to service black businesses and serve the black community."

"I think a lot of black businesses want to use a black attorney but there aren't any do do the type of work they need," Byrd said.

In the Baltimore metropolitan area, there are fewer than a dozen black-owned law firms or firms with a majority of black principals, according to estimates from practicing attorneys and the Monumental City Bar Association, a professional organization for black lawyers.

The Maryland Bar Association and Monumental in 1987 conducted a study that found most black lawyers were going to work for the government and that the number of black law firms JTC doing both criminal and civil work in Baltimore was declining.

Of the approximately 4,300 practicing attorneys in Baltimore, that report said 350, or 8 percent, were black.

During the last four years, the overall number of attorneys practicing in Baltimore has more than doubled to 9,000, an increase of 109 percent. During the same period, the number of black attorneys in Baltimore has increased 21 percent to about 425, according to Patrick A. Roberson, president of Monumental.

Roberson said 49 of the 425, or 11 percent, work for the 10 largest law firms. Baltimore's top 10 firms employ about 1,600 attorneys.

The 1987 report said the scarcity of black law firms and black lawyers in private practice is due mostly to the failure of large corporations to send legal business to minority attorneys, and the poor record of large, white-dominated law firms in hiring blacks.

The study arose from a conference on minorities in the legal profession. A similar statewide conference sponsored by the Maryland Bar Association is scheduled April 13 at the Omni Inner Harbor Hotel.

Lowell R. Bowen, managing partner of Miles & Stockbridge, said times are changing and that major law firms are giving blacks a chance to practice in areas of law that most have not been in before.

"The doors of large firms are open and welcoming minorities," Bowen said. "And, the situation is ripe for the growth of minority firms. Time is correcting a lot of the imbalance."

Bowen said his firm has one black associate and plans to hire three more in the fall.

Miles & Stockbridge generally recruits law students in the top third or fourth of their graduating classes, said Bowen. He said the firm has made efforts to hire minority attorneys but that standards at his and other major law firms are tough.

William H. Murphy Jr., one-time Baltimore Circuit Court judge and a city mayoral candidate in 1983, believes that black law firms can capture more of the business market, white or black, by marketing themselves better.

Murphy admits he is known for his criminal practice and says he has not heavily marketed his civil practice, which makes up 50 percent of the work at his firm, which has three other partners.

"There is a tremendous resistance to black lawyers in the business arena. But in order to crack the business market, attorneys will have to develop marketing strategies," Murphy said.

"Basically it's a matter of exposure," said Michael G. Middleton. "We need to free up time to do more marketing. As litigators we spend a lot time in court."

What they have in their favor, says Lawrence W. Shavers, is their collected experience in both the private and public sector.

Shavers and Anthony K. Waters each served as Maryland assistant attorney general. Middleton served as an assistant U.S. attorney for the District of Maryland. Arnell, who joined Middleton, Waters six months after it was established in 1988, is one of only two black females to have served as an assistant U.S. attorney for the District of Maryland.

Middleton says his firm is caught in a Catch 22 situation -- too small to win major corporations but unable to grow without such clients.

Shavers said the firm has been able to get piecemeal work from corporations but not big-ticket retainers. He said they hope to build the firm to 15 attorneys in the next five to 10 years. Right now the firm, which has two associates, handles civil litigation, criminal law, personal injury, domestic cases and real estate.

Middleton, Waters also has received litigation and real estate contracts from the city.

Bowen said one way for black law firms to attract major clients is through joint ventures.

Miles & Stockbridge has joint ventures with black law firms because certain government contracts require minority participation. However, sometimes finding a firm with experience in handling certain business issues such as bonding is difficult, he said.

"Frequently, we take on people and teach them as we go along," Bowen said.

Middleton, Waters is involved in a joint venture with Miles & Stockbridge in a $50 million civil law suit against the architects of a water tunnel.

The firm is also involved in a joint venture with the law firm of Weinberg and Green. Both firms are helping set up the state's Venture Capital Fund, which provides start-up capital for businesses in Maryland.

Brown, Alston has already worked on several litigation matters with Miles & Stockbridge.

Bowen said the inability of black firms to attract major corporate clients isn't a matter of racism.

"That type of work isn't going to small non-minority firms either," he said. "Major corporations are going to firms with horsepower. And it takes time to build a firm. You can't build a 200-lawyer firm overnight."

Murphy said blacks are going to have to stop complaining about racism.

"There is of course still racism but you don't overcome it by complaining," he said. "A lot of white lawyers have the same problem. It's a competitive world and we have to go after the business like everyone else. You just can't hang your shingle out and expect people to come to you," he said.

Looking back, Fugett said he isn't sure why his firm wasn't able to attract major corporate clients on retainer. At its peak, Fugett said he and partner Jeanne D. Hitchcock employed 10 lawyers.

Ultimately, Fugett said he dissolved the firm because he wasn't earning sufficient profits.

Now, Fugett is head of the Fugett Group, which represents sports figures and broadcast personalities. He is also of counsel for Rifkin, Evans, Silver & Rozner.

"I'm not saying it didn't work because I was black," Fugett said. "It could have been my failure to market. But I knew we had talent."

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