VOL. 37 | NO. 25 | Friday, June 21, 2013
Moving from big firm to small has its perks
By Jeannie Naujeck
Joe Goodman, who recently left a big downtown firm behind to join a boutique practice in Cummins Station, shows off one of the perks of small-firm life – a relaxed atmosphere that allows for no socks. -- Michelle Morrow | Nashville Ledger
In February, Joe Goodman said goodbye to a top-floor, corner office at a downtown law firm, and headed up Broadway to markedly less-opulent quarters overlooking the railroad gulch.
At the big firm, Goodman had a secretary to handle all his dictation and errands.
Now, at his office in Cummins Station, he’s typing his own memos, rinsing his own mug and putting out his trash.
But Goodman also is relishing the relative freedom, dispensing of formalities and sense of ownership as a partner in Callahan Witherington, a five-person tax, estate and probate boutique formed by two Generation Y attorneys.
He couldn’t be happier with his choice.
“My overhead has gone down dramatically. I’ve reduced my hourly rate substantially, and I don’t think my income is going to change that much,” Goodman says.
A prominent tax and estate attorney who spent most of his career at big firms, most recently Adams and Reese, Goodman says moving his practice to a boutique firm was a matter of survival. His clients were becoming concerned about fees, which he says were high to cover his share of overhead.
“I should’ve done it at least two years ago. I got the message loud and clear from my clients, that I’d better get myself adjusted or have issues over fees and rates,” Goodman, 62, says of leaving Adams and Reese.
“Here, we can practice at a very high level of expertise and serve any client, and we just don’t have to have the overhead to do our work.
“I guess unless the big firms figure that out, we’re just not going to come to an agreement on what our share of the overhead is.”
Goodman’s career shift – and the formation of Callahan Witherington – exemplifies a national trend of tax and estate groups leaving or being let go by large firms.
Tax, estate and probate is a law practice that caters to high-net-worth individuals and families, and it’s a very different animal than traditional corporate practices such as mergers and litigation.
It can often get quite personal, even messy at times. It’s also less lucrative for firms, as it does not require the phalanx of attorneys that big corporate deals do.
However, it’s created an opportunity for like-minded lawyers to form smaller firms.
And that’s exactly what CW founder David Callahan did in May 2010, when he left Adams and Reese.
“The big firm gave me a lot of opportunities to learn how to be a lawyer and work with really top-notch, talented attorneys,” Callahan says of Adams and Reese, where he first met Goodman after being brought on to develop a probate litigation group.
“But it came to a point, personally, where I wanted to see what I could build on my own, and I was fortunate enough to build a client base that appeared sufficient to support a move out on my own. I couldn’t see the future that I wanted for myself at the big firm.
After operating as a solo practitioner for a year, Callahan joined in April 2011 with Patrick Witherington, who had left Howell & Fisher with a similar ambition.
As business grew, the firm expanded into larger space, and in February 2013 Callahan convinced Goodman to leave big-firm life for an entrepreneurial startup.
The transition for the senior attorney has been remarkably easy. Goodman is as well known for his congeniality as his knowledge of tax law, and he’s found that clients are more relaxed in the smart but casual atmosphere of his new office.
“Most of our clients own their own businesses, and they know the value of a dollar and don’t want to pay for overhead that they think is excessive,” he says of law firms located in Class A real estate space.
“They’re just not built that way, and they’re worth tens of millions of dollars sometimes. They’re much more comfortable in our offices here in Cummins Station.”
The firm also includes attorneys Elizabeth Betts Hickman, a former vice president and trust officer at Cumberland Trust, and Gino Marchetti, who is well known for his work with The Catholic Diocese of Nashville.
Marchetti practices estate and business planning, administration and litigation at CW while also maintaining a civil litigation practice at Taylor, Pigue, Marchetti & Blair.
Similar tax firms in Nashville include Howard & Mobley, a five-person practice made up mostly of Waller Law alums, and Holton Blackstone & Mayberry, a six person firm begun by three other Adams & Reese attorneys.
Both are in Green Hills.
Business at Callahan Witherington has grown tenfold from the scrappy early days in the closet-sized office, and will continue to grow because of demographics.
The first wave of baby boomers is beginning to transfer its wealth to the next generation, and people coming into new wealth generated by Nashville’s dynamic entrepreneurial sector will require tax and estate planning expertise.
Boutiques will also continue to grow as large firms refer wealthy clients, knowing that a small firm of specialists solely focused on one practice will not pull away business in other areas.
Goodman says, having worked in both large and small firms, he sees the pros and cons of both.
“What I’ve learned going from being in the top floor office with the best view to sharing an assistant with one or two other people … well, Joe Goodman’s learned to type!” he says.
“I’m delivering two reports tomorrow that I typed personally, and I’m kind of proud of them.
“I had an ace who did that for me for 24 years. It took me leaving to figure out I can do it.
“I don’t think the lawyers in the big firms have tried very hard.”
Not that he didn’t enjoy the perks of big-firm life, Goodman hastens to add.
“I can tell you some things I’ve done at Callahan Witherington that I’ve never done anywhere else … taking my trash out or putting my dishes in the sink or typing a memo,” he says.
“But by George, it doesn’t take long to do stuff like that. It’s no big deal to do your own billing.
“And at the big firm, you had to go through a big process to do conflict checks.
“Here, you just yell down the hall, ‘Anybody mind if I take this client?’”
And there’s another advantage to small-firm life, Goodman notes.
“Look,” he says, pulling up his pants leg.
“I don’t have to wear socks!”