Philadelphia: The Right Business Incentives And Legal Community Create A Dynamic Commercial Center Cozen O'Connor (215) 665-2000

Editor: Based in Philadelphia, your firm has expanded to 20 offices throughout the U.S., an international office in London and an affiliate office in Toronto.As the founder and chairman of this successful enterprise, how would you describe Philadelphia's economic and business climate?

Cozen: The climate is very dynamic. Philadelphia has a lot of business transactions taking place both within the city and extending globally beyond its borders. Philadelphia's crossroads location contributes to its vitality as a commercial center. The businesses in Philadelphia are multidimensional with respect to their day-to-day operations. To serve their needs, our firm has grown over the years from a small boutique firm in 1970 into a full-service firm with more than 480 attorneys.

Editor: How has the city's government become more efficient in delivering the services that impact Philadelphia's continued growth?

Cozen: From a macroeconomic standpoint, the government has made significant improvements in Philadelphia's school district. And, we have had great leadership in Paul Vallas, who was able to stabilize our school system.

A city's educational system is often overlooked when discussing its economic stability, but schooling is a vital component of economic development. Many employers want a location that has the right business incentives and, at the same time, one that is suitable for raising a family. Employers are also concerned with the availability of a well-educated workforce. A poor educational infrastructure also affects the tax climate in an area because the local government needs more money to improve the system. Governor Rendell began the necessary improvements, and Mayor Street continues to work hard to create further stability in Philadelphia's education system. While we have made considerable improvements in education, there is always room for improvement.

Editor: Has Philadelphia become more competitive with cities that are actively wooing companies with tax credits and a business-friendly climate?

Cozen: Representing the business community, the Greater Philadelphia Chamber of Commerce has made tremendous strides working with government to make taxes more realistic. They also help ensure that Philadelphia maintains the quid pro quo relationships it has with neighboring communities needed for an equitable balance of government services and revenues throughout the greater metropolitan area.
Editor: What contributes to making Philadelphia a great place to live and work?

Cozen: The commercial real estate market is a buyer's market, which encourages businesses to stay here and attracts startup businesses because they do not have high real estate prices as a barrier to entry. Philadelphia is a great place for a lot of other reasons as well. The nature and culture of the city contributes to its family friendly atmosphere. The ethnicity of the city and its neighborhood structure add a welcoming atmosphere as a place to live.

Editor: How do you find the legal climate in Philadelphia?

Cozen: Like most other urban areas, Philadelphia has a variety of forums for resolving disputes. The Eastern District of Pennsylvania has a strong federal court bench that services out-of-state businesses with connections to Philadelphia and Philadelphia businesses engaged in service out-of-state.

Philadelphia has enjoyed significant growth in the area of alternative dispute resolution, particularly over the last ten years. The city has more than its fair share of retired judges and other qualified experts serving as arbitrators, mediators or masters who are very proficient in dispute resolution. I consider our legal community fortunate to have so many talented people devoted to that kind of effort in the city at this time.

The Common Pleas Court of Philadelphia County, for the most part, has good dedicated judges but, like other jurisdictions, jury verdicts in certain cases, particularly medical malpractice, are troublesome. When a jury awards excessive damages, I believe that judges could be more proactive in their decisions to set aside the verdict. This is a problem throughout the country, but it affects Philadelphia more because we are home to many healthcare providers, including two or three of the top universities in the country that have dedicated significant assets to biomedical ventures as well as to state-of-the-art delivery of healthcare. I believe that the Commonwealth's legislature should get involved and reform the current system to avoid many of the current inequities.

Editor: What legal challenges do businesses face today?

Cozen: Two major legal challenges confront businesses throughout the country. One is the increased cost of reporting and other corporate compliance issues that companies face because of statutes such as the Sarbanes-Oxley Act. The new set of rules of corporate governance replace a framework that had been very flexible and subject to good judgment.

Another concern for corporate CEOs is the issue of litigation management. Philadelphia's corporate community is not in the business of litigation and does not want to expend energy and resources in potential litigation. Corporate management needs to prepare for the possibility of litigation and divert the necessary resources to its prevention. During this process they should consider the reasonable precautionary steps they should take and the right people to contact. That requires a lot of very careful direction from counsel who have been down that road before and are confident in a variety of areas. Part of the process involves a close relationship between in-house and outside counsel.

Editor: How do these challenges affect the role of corporate counsel?

Cozen: Corporate counsel must spend more time on corporate governance and compliance issues, as well as on litigation control and management. Corporations need in-house counsel who have the capacity and ability to deal with those issues and the strength and confidence to deal with outside counsel in a way that is going to be effective and efficient in providing the proper representation to its company.

Editor: What can in-house counsel do to get value from their interaction with outside counsel?

Cozen: The key word is relationship. The attorney/client relationship is not one between companies or corporations. No matter what the size of the law firm, or the company, the attorney/client relationship exists between individuals. There has to be an individual reaching out to the right people so that there is a relationship of trust and confidence. It seems to me that the way to get the most value is to develop relationships with those people who you know will grow with you over time and have the resources you need. The culture and quality of character that you feel comfortable with are also important.

Editor: What practical tips would you give corporate counsel in that process?

Cozen: They need to do their homework. They should not simply select outside counsel because the company has used them for the past five years. They should examine why and whether the experience has been a good one. Corporate counsel should also consider whether the types of things they are concerned about today are the things that the firm has expertise in handling. They should also look at the personal relationship and whether it is one of trust and confidence, and whether the firm has all of the necessary resources. They should also consider whether this is the best firm to handle potential litigation that might come up. The process of selection needs to be driven by corporate counsel and the due diligence has to be his or her responsibility.

Editor: Congratulations on the many awards your firm has received for its initiatives.

Cozen: We are actively involved in the community through Community Legal Services and the Volunteers for the Indigent Program (VIP). Our attorneys serve as pro bono child advocates, as counsel for the elderly, indigent, or homeless, and as legal advisors to numerous charitable organizations devoted to the care and service of needy citizens.

Among our many awards, we recently received the Justice William Brennan Award for exemplary standards in pro bono service several times. Our attorneys have also received the Philadelphia Bar Association's Craig M. Perry Community Service Award for leadership in the community and the Philadelphia Support Center for Child Advocate award for distinguished child advocates.

A couple of years ago we initiated a new and aggressive pro bono effort. Now everyone in the firm is required to devote 60 hours of their time, annually, to pro bono work. It is one of the most aggressive pro bono ptograms in the U.S. The number of hours and total time value of those hours dedicated to our pro bono initiatives are astronomical. In fact, last year the firm took on more than 60 pro bono cases totaling more than 16,000 hours of service.

Editor: What sustains your firm's long-term commitment to incorporating pro bono initiatives into its practice?

Cozen: The reason we do pro bono work is because we have always believed, and continue to believe, that the law does not work unless everyone has access to the law and to the institutions that implement the law. That access has to be free and equal. Unless those who are less able to afford it have access to it, the legal system does not work for anybody.

Editor: Why should an in-house counsel who is considering a law firm, take into consideration whether or not the law firm does pro bono work?

Cozen: It is one of the facts that tells you about the culture of the firm and the quality of its attorneys.

Published July 1, 2004.