Omaha, Nebraska, June 22, 2019 – Just weeks after passage of the highly controversial American Bar Rules Reform Act, Warren Buffet, widely considered to be the nation’s most savvy investor, made a surprise announcement of the $28.6 million purchase of his company’s primary legal counsel, the Omaha firm of Barnhart, Short & Andressen, which has nearly 100 attorneys and five offices in three states.
Buffett issued an unusually detailed statement concerning his future plans. “The legal profession has historically been the last of the “guild” professions, and has until now managed to resist consolidation. We see an immense opportunity to modernize the delivery of legal services with operational, management and functional changes, and ‘consumerize’ the delivery of a host of legal and other professional services at both the individual and business levels.”
The Berkshire Hathaway announcement is widely seen as the first shot in a major restructuring of the legal profession facilitated by the surprise passage of the 2019 American Bar Rules Reform Act. That Act generally followed the 2016 Canadian legislation resulting from a 2014 Report, “Futures: Transforming The Delivery Of Legal Services In Canada.”
The Canadian legislation itself was closely patterned after Britain’s 2007 Legal Services Act, which legalized non-attorney ownership of law firms and so-called “multi-disciplinary practices,” meaning a single entity which delivers a variety of services such as legal, accounting and medical under one roof. Passage of the British and Canadian legislation engendered an unanticipated major economic upswing that attracted the attention of U.S. investors and legal entrepreneurs, who led the sometimes bloody three-year fight in Congress for the bill’s passage.
The unexpected announcement from Berkshire Hathaway echoes the company’s 2014 purchase of a major auto dealership group, and the subsequent major consolidation of the new-automobile sales marketplace. Today Berkshire Hathaway controls nearly 30% of the automobile dealerships in the U.S., having driven more than 600 independent dealers out of business.
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