Regular cash flow, while working on a contingency fee-based structure, is a big challenge for most plaintiffs firms. Steve German, who just launched the Arizona-based plaintiffs boutique Scout Law Group, says he has changed that equation for good.
Regular cash flow, while working on a contingency fee-based structure
I got resources now to reach out around the country. We are now able to represent huge clusters of clients,” he said.
With the backing of the Miami-based investment firm 777 Partners, German is aiming to expand his firm’s reach and involvement in mass tort litigation from Arizona to across the United States. Arizona became the first U.S. state in 2021 to restructure law firm ownership allowing for private investment in legal businesses, as reported previously by Law.com.
The alternative business structure model, as noted by the Arizona Supreme Court, is meant to encourage innovative approaches in the access to and delivery of legal services. “In a way it’s very shocking — the state disrupts law firm practice as it has been for 100 years,”German said.
While the 13-person firm is aiming to better position itself in a highly competitive personal injury and mass tort environment, legal marketing professionals point out that this alternative business model could be attractive for some clients. “All law firms look alike to a personal injury client. However, if you say ‘We’re the best-funded firm and that’s why it is important to you’” it might drive the decision to choose that particular firm over others, according to Fishman Marketing CEO Ross Fishman.
The partnership with a private investor does not only come with a financial infusion, “it’s completely different, it’s not just money,” German said. 777 Partners provides all of its resources from information technology to accounting and administrative services.
The goal is to not only use the investment to scale but also to “not just represent clients — we want to give back to the community,” German said. Clients will have the option to donate a portion of the attorney fees to a legal nonprofit or charitable organization.
Marketing professionals doubt that the pledge will be generating more business for the firm. “I’m glad they are doing that, but it’s a pretty vague promise,” Fishman said, wondering if clients “will choose a law firm because they’ll give some unknown percentage of the verdict to a particular cause.”
In addition, the firm promises to offer social workers and case managers with access to support groups. “If somebody suffered sexual assault, I don’t have the training and resources” to properly help the client, German said. Most people are afraid or intimidated to go to a lawyer “and that brings a compassionate side to what we do … because it’s usually the worst time of their lives.”
We are the pioneers revolutionizing how firms operate,” he said. The firm also underscores that private investment does not equal third-party influence in litigation. “If that was the intention, they picked the wrong guy,” German said. “I made it clear to them and they made it clear to me that this is my law firm.