Internal Policies FAQ

All members must join the firm in their individual capacity and must cease using any former professional entities upon joining the firm. Similarly, all professional services (i.e., practice of law or ancillary services such as business consulting) must be performed exclusively through the firm, including all timekeeping/billing and document storage through the designated DMS. Moonlighting of legal/consulting services by members of the firm is not permitted. 

Our members are compensated based on collections. Members should also be mindful about performing work for a client that appears unlikely or unable to render payment (otherwise, such work should be deemed as pro bono because the likelihood of getting paid is low). The firm does not bring collection actions (i.e., lawsuits or arbitration) against clients because they often lead to counterclaims for malpractice against you and the firm. Therefore, to avoid collection challenges down the road, we strongly recommend that you obtain appropriate retainers, especially in litigation matters where costs can quickly escalate.

Our members are afforded significant autonomy when it comes to time management, their rate, and the firm does not impose a billable hour quota. However, the expectation is that our members are working as full-time, practicing lawyers and will achieve a minimum of $150,000 in take-home compensation each calendar year.

Given the nature of our distributed business model, facilitating opportunities for personal interaction and collaboration among our members is an area in which we are very deliberate and intentional. We have three areas where we require member attendance: First, our monthly firmwide call is held the first Wednesday of each month (unless it conflicts with a major holiday such as July 4th or New Year’s Day, in which case it is usually moved to the second Wednesday). Second, we expect everyone to attend a monthly regional meeting/event, either with their local office when in-person events are scheduled, virtually when two or more markets meet together on Teams, or by traveling to visit a meeting in one of our other markets (notably, many of our attorneys have found that visiting other markets on a routine basis and getting to know attorneys around the country opens the door for more internal referral opportunities). Third, everyone is required to attend CM’s annual partner retreat (typically 3 nights/4 days). 

CM attorneys voluntarily serve on different committees (e.g. The Welcome Committee, Business Acceptance Committee, Wellness Committee, Advisory Committee, etc.). Service is not mandatory, but it does often end up being fun–plus it gives you a voice to help make CM an even better place in the future. We highly encourage you to volunteer for committee service in one way or another. 

Our members have undoubtedly exercised great discretion in developing your client base – CM Law is no different.  We are a business law firm and our attorneys are precluded from representing clients in matters related to or arising from certain situations, including but not limited to (i) divorce/family court proceedings, (ii) criminal cases, (iii) personal injury plaintiff-side cases, or (iv) employee-side plaintiff cases. Furthermore, the intake of each litigation case is subject to review by the firm’s Business Acceptance Committee.  

Large institutional clients often have Outside Counsel Guidelines (“OCGs”). Because OCGs create additional duties beyond the firm’s standard engagement agreement, the firm’s GC Office must review and approve the guidelines before CM accepts the engagement. If the OCGs contain IT/data security policy requirements, these need to be forwarded to the firm’s CTO to confirm that our systems satisfy the client’s requirements (fortunately, CM’s policies and security often exceed what the client requires). Most OCGs relate to timekeeping policies, billing instructions, expense reimbursement, drafting style guidelines and other business terms. The Originating Attorney is expected to be familiar with those (and make sure any Working Attorneys are in the loop and remain compliant).  

Our low overhead financial model allows the firm to pay members a significantly higher compensation percentage than most traditional firms. However, that also means that our attorneys bear the costs of their bar dues, CLE, and home office/mobile phone. Most of us work from our home office, though a handful of us choose to pay rent for shared or dedicated office space.  The choice is yours!

In traditional businesses, including most large law firms, the financial structure captures substantial revenue that can be used to fund overhead such as group benefits programs (e.g., in a recent survey, AmLaw 100 firms retained an average of 61% of all revenue collections to cover overhead and used 39% in compensation to their attorneys). A core aspect of CM’s low-overhead business model is that we push a substantially higher percentage of collected revenue directly down to our attorneys, leaving far less “pie” for the firm to spend on expenses like benefits. This approach enables members to make purchasing decisions based on what makes the most financial sense for their unique needs–for everything from computer hardware and office supplies to CLE courses. Likewise, we adopt the same philosophy with our member-funded benefits programs. CM does not currently mandate participation in group benefit plans, nor does it subsidize the costs of member benefits. CM Law reserves the right to amend, suspend or terminate any benefit plan or internal operations policy, in whole or in part, at any time.

Federal – Attorneys at the Firm are non-equity or income members for tax purposes; accordingly, the Firm files a Federal Form 1065 Partnership Tax Return, and its income is allocated out to all of its members through a Schedule K-1 (which the attorneys in turn use to file their personal returns). The Firm does not withhold for your Federal tax liability – you are responsible for calculating and paying estimated taxes.

State and Local – Residents – Taxes payable in connection with your state(s) of residence are generally based off your K-1 income. The Firm does not withhold for your tax liability to the state(s) in which you maintain residency – you are responsible for calculating and paying estimated taxes.

Non-Resident State Income Taxes – Attorneys at the Firm are responsible for paying taxes in jurisdictions other than the one(s) in which they maintain residency. For the most part, the calculation is based off of the income that is allocated to the member based upon both the percentage of the member’s income in relation to the overall income of the Firm, and the revenues that the state apportions to the Firm’s operations in relation to the state (e.g., usually depending on the location of the client serviced and/or where the Firm’s lawyers performing services are located). States within scope are those with which the Firm has a tax nexus (according to each state’s rules).

Composite or Group Returns. The Firm permits its lawyers to elect to participate in composite/group returns where applicable. Under that arrangement, the Firm files the tax returns and pays the taxes on the attorney’s behalf (from amounts withheld from that member’s draws throughout the year) for the particular jurisdiction. The tax rate is typically a little higher under this option, but the corresponding benefit is that there is no need for the attorney to file his or her own return. Your tax professional can help you assess whether there is a benefit to joining the group return.

Opting Out of Group Return. An attorney may also opt out of the composite/group return. Doing so will mean that the attorney must file his or her own tax return(s) in the state(s) in question. It may also mean that the attorney will need make quarterly estimated tax payments (unless the state still requires the firm to withhold). Your tax professional can advise you as to whether there is a benefit to opting out (e.g., to take advantage of your personal tax situation, etc.).

Other State and Local Taxes (including professional Business License Fees) – There are generally two bases for these types of taxes: flat fee per professional or income allocated to the particular jurisdiction. The former is charged to the account of the lawyer, and the latter is allocated to the applicable members based upon each member’s income in relation to the overall income that the jurisdiction allocates to itself. Each individual member is also personally responsible for any local taxes, professional registration fees or business license fees (e.g., county or municipality) that may relate to their home office location.

Note: The foregoing is for general information purposes. Given the complexities and variances of taxes across our multiple business jurisdictions, the Firm encourages all candidates/members to consult with their personal tax advisers as to how membership in CM Law will impact their individual situation. 

Attendance at the retreat is required and CM Law  provides significant financial subsidization toward the retreat costs as part of the firm’s annual operating budget; however our low-overhead business model means there are still three main out-of-pocket components for each member to attend the retreat:

1. Airfare/Transportation. Partners are responsible for their own airfare or transportation to and from the retreat venue. The Firm takes into consideration the flight regularity (or driving proximity) and costs from our business markets, together with the ground transportation costs to get from the closest airport to the retreat venue.

2. The Attorney Contribution is capped with the objective of keeping it as reasonable as possible. The attorney contribution is paid through installments across several draw deductions leading up to the retreat.

3. Extra Nights and Optional Activity Fees will be paid directly by the attorney (e.g., room service/bar charges, museum/tour/golfing fees, extra nights before or after the official retreat dates). At check-in, members will be required to present their personal credit card for any incidentals charged to their room during the retreat. 

Note: The firm’s retreat budget and venue contract is based on a minimum headcount and rooming commitment. Attorneys who miss any nights during the retreat without prior approval by the Leadership Team are still responsible for paying the full Attorney Contribution.

IP practitioners should refer to the IP Practitioner Cost Guide for detailed information about our patent and trademark docketing system and related costs. All other non-IP docketing, such as  litigation and arbitration, is managed through the mandatory use of the firm’s  litigation docketing protocol. 

The firm does not advance any out-of-pocket client expenses, and the Originating Attorney is personally responsible for any charges that are inadvertently billed to the firm (e.g., filing fees, court reporter fees, discovery scanning/copying services, litigation support vendors, online research fees). Best practice is to have clients pay for such expenses directly with the vendors. The next best option is to obtain an appropriate retainer and then the Originating Attorney pays the costs on a personal credit card, which costs can be submitted as a reimbursable expense in the firm’s timekeeping system (to be paid from a retainer or when the client pays their invoice).

It depends. Based on the current terms of our professional liability insurance policy (which are subject to change each year). Please reach out to the GC at gc@cm.law with a copy to kverska@cm.law with any questions.

The firm has retained an outsourced marketing group and spends a considerable amount on firmwide branding and public relations initiatives that benefit your practice as well as the entire firm (e.g., PR agency services, website, social media, newsletter, standard logos/graphics). You will be introduced to our marketing team quickly upon joining. If you want to sponsor an event at your local bar association or develop custom marketing materials or hard copy advertisements for a local chamber of commerce, etc., those out-of-pocket costs are your responsibility. That said, the firm’s outsourced marketing group provides you with substantial support helping design marketing materials and they will promote your event on the firm’s social media, etc. Attorneys pay for their own business development, client meals, entertainment and travel costs. The Grid contains a robust library of marketing materials, resources, and templates to help you with your personal business development efforts, responses to Requests for Information, etc.

We have several in-house executive assistants and a back-office team who help manage the firm’s best day-to-day practices.  Many of these amazing support staff are available to you on an ad-hoc basis to assist with your admin needs (at your cost). We recognize that some members prefer to rely on dedicated non-attorney support staff to help them manage their practice. The firm has several different structures available to match your needs, including but not limited to contract attorneys in specialty areas where the firm may lack bandwidth or expertise.  These contract attorneys have been onboarded and are ‘on call’ for your needs. All available options are described in detail on the firm’s “Grid” and can be discussed with you during your onboarding with the firm.

On the advice of the firm’s Advisory Committee, the firm entered a multi-year subscription, so all members have access to the Lexis/Nexis Professional Package with a modest monthly pass-through cost charged to each attorney in the form of a draw deduction (the details are on the Grid). This robust package provides a wide array of legal research tools, transactional forms templates, treatises, case law research, Law360 and Wall Street Journal online access, and much more. Beyond this primary firmwide resource, the cost of any other practice-specific software, database, treatise, or other services specific to a given practice area is not allocated to all members at the firm but is instead allocated only to the members in that given practice area or those who elect to subscribe as part of a group membership rate.

Yes, but if you serve as an officer/director of any entities, you’ll have to abide by our risk management policies, including but not limited to a review of the D&O insurance coverage of such entities and you will be asked to indemnify the firm against any claims or damages in connection with or due to your officer/director activities (i.e., your non-legal work for the entities).

If an attorney anticipates joining CM Law directly from a solo practice or following the wrap-up/dissolution of a prior firm, we require that the attorney provide us with documentation of his/her extended professional liability coverage (also known as a “tail policy”) for any legal services rendered prior to the official start date at CM Law. This is to protect the incoming attorney from a lapse in coverage for any claims arising prior to the start at CM Law and it also helps protect the firm from having to defend claims arising from such prior acts where the attorney is transferring active client matters over to CM Law. Of course, if the attorney is leaving an AmLaw 200 firm or another stable and established firm with no indication that it will end business operations or cease its professional liability coverage, then this requirement can be waived.