💔 Dentons is going through a breakup
In today’s email:
China is exporting less
Wilko is going into administration
Dentons is working through some stuff
US law firms let their staff stay at home
The Magic Circle firms as Taylor Swift looks
How the world lives at different income levels
The AI that can tell what movie you’re thinking of
How the news is covered differently around the world
… and more!
EDITOR’S RAMBLE 🗣
Two big things happened this week…
Firstly, LittleLaw got to over 8,000 subscribers! (👋 to all you new guys)
Secondly, I posted a new YouTube video showing a day in the life of a corporate lawyer in London.
Check it out if you’re interested! 👇️
🔈️ Quick shoutout — Big thanks this week to Vivian Matthews for sharing the newsletter. I am so grateful for the support from each of you in growing LittleLaw.
I want to update the referral rewards to give you guys more of what you want. Reply to this email to let me know what you’d like (like, would you rather free LittleLaw merch — or something like an application strategy call with me?)
LAST WEEK’S POLL 📊
In last week’s newsletter, I asked your views on if you thought Taco Bell were guilty of false advertising because of how different their pictures looked to their actual food.
The pic from their advert
The actual food advertised
Well, the results are in!
Is Taco Bell guilty of false advertising?
🟩🟩🟩🟩🟩🟩 Yup - it just looks too different (59)
🟨⬜️⬜️⬜️⬜️⬜️ No - fast food isn't going to be perfect (18)
I thought this would be the result but didn’t think it would be so heavily one-sided!
Here’s what some of you had to say…
😡 Yup, IT IS false advertising!
“If they know they aren't able to make it like that from the outset they should never advertise it that way.”
“Fast food ads are known to not represent reality, however, here, it just looks too different :) especially since there is a really big difference between how much meat there is in the ad vs reality… I think it's like a 'Photoshop/Instagram vs reality.”
“I agree that I would expect the food to look like the reality photo because I have eaten taco bell before and know the quality of their food. But those photos are misleading and there is no reason to allow these large chains to get away with false advertising.”
😇 No, it’s NOT false advertising!
“Fast food isn't going to be perfect and class actions like this just pave the way for more litigation. Just feels like a slippery slope of suing anyone about anything.”
“Have you ever watched those videos where they show you how food adverts are made? The milk in the cereal is actually glue so that the cereal can stay up. Compare McDonald's advertised burgers to the actual burgers. It's all staged to get you to buy more. I do think, for Taco Bell, the 'what I ordered vs what I got' difference is outstanding but I doubt they would lose the case. We'll just have to wait and see.”
FEATURED REPORT 📰
💔 Dentons is going through a breakup
What’s going on here?
Dentons, the world's largest law firm by headcount, decided to split from its Chinese partner, Dacheng, after eight years together. This move came after China introduced stricter data privacy and cybersecurity regulations.
Why did Dentons separate from Dacheng?
It’s because the Chinese government made some new rules relating to data privacy, cybersecurity, capital control (how much money moves in or out of the country) and governance (how businesses are run). It would have been a real challenge for Dentons to adjust to these new regulations. So they thought separating was the best move.
What was the structure of the Dentons-Dacheng partnership?
In 2015, Dentons and Dacheng teamed up in this arrangement known as a ‘Swiss Verein’. It means the firms stay separate in financial terms but work together under a shared brand.
It was a revolutionary move at the time. The Dentons-Dacheng alliance saw Dentons, a massive global law firm, team up with Dacheng, the biggest law firm in China.
The result? The world's largest law firm by headcount which was truly global.
Look at how many countries Dentons operates in 👆️
What are the challenges for foreign law firms in China?
📜 Regulations: There are new rules about data privacy, cybersecurity and other areas relating to national security. These rules can make it tough for international firms to operate smoothly (and are why Dentons is leaving).
🤝 Local law restrictions: Foreign firms can't practice local law directly without partnering up with with local Chinese firms. So, Baker McKenzie paired up with FenXun Partners, Herbert Smith Freehills with Kewei, Linklaters with Zhao Sheng and Allen & Overy with Lang Yue.
🕵️ Government intrusion: The Chinese government has increasingly been peeking into law firms' business. Last year, the Big Four auditors' mainland China practices had to shut shop. The reason wasn't clear, but it seemed to relate to data and national security concerns from Chinese authorities.
🇨🇳 National security concerns: Under the national security umbrella, Chinese lawyers might be required to share explicit client info with the state. They can also be stopped from sharing China-related data with international peers, making legal work like due diligence on cross-border deals super hard.
How will the separation impact Dentons?
Dentons will definitely be feeling a little different after this breakup…
📉 Size: Without Dacheng, Dentons can no longer flex about being “the world's largest law firm by headcount”. It’ll go from 12,000 to 5,970 lawyers.
💵 Money: Their revenue's going to take a hit. Dentons had reported a $2.94bn (£2.3bn) gross revenue in 2022, and with Dacheng out of the picture, that number's going to shrink.
🏷️ Branding: In China, they can't use the Chinese characters “大成” in their logo anymore. It's like changing your profile pic on Insta — it's a big deal!
👣 Global footprint: Their reach across different areas in the world will be reduced.
👋 Client: While they'll still work with Dacheng, the dynamics are going to change.
Who else is in China anyway?
Other global firms who have offices or operations in China will take notice of this decision from Dentons.
These are how some of the big players entered that region…
🗓️ 2015: Baker McKenzie formed a joint operation with FenXun Partners,
🗓️ 2019: Herbert Smith Freehills started working with Kewei,
🗓️ 2019: Linklaters paired up with Zhao Sheng,
🗓️ 2020: Allen & Overy entered into a joint venture agreement with Lang Yue, and
🗓️ 2023: Eversheds Sutherland and King & Wood Mallesons (Asia’s largest law firm) signed a formal cooperation agreement.
Why should other law firms care?
So, will Dentons’ decision cause a domino effect with other law firms following their lead? Absolutely. China’s new rules will apply to all international law firms in the same way so it’ll cause others problems too.
I mean, the potential issues could be things like mandatory data sharing with the Chinese government, not being able to do basic conflict checks on cross-border deals and the possibility of unannounced raids by Chinese authorities.
So… not headaches you’d want to have at your firm.
Even if they don’t leave, firms will be changing their relationships with China. We might see ‘softer’ ways of working together — maybe something like a strong referral arrangement would let law firms work together without getting caught in each others’ regulatory systems.
Dentons' split from Dacheng highlights the challenges of the legal world's dance with China. As the music changes, it seems other firms might need to rethink their steps too.
TOGETHER WITH INTERNATIONAL INTRIGUE* 🤝
Did you know: The exact same news stories are covered differently around the world 👇️
The guys at International Intrigue read the news, then read it again and a third time.
After that, they share all the different headline with you… just like you can see here. 👆️
So you’ll get the news, BUT ALSO you’ll understand the different perspectives from around the world.
That’s what you might call 4D commercial awareness.
The 5-minute newsletter gives apolitical, jargon-free news and analysis from around the world.
* This is sponsored content
A BIT OF FUN 😄
Introducing… the Magic Circle firms as Taylor Swift looks
(click the post to see the rest of them… this is just the start 👇️)
IN OTHER NEWS 🗞
😓 Wilko, the UK's go-to store for budget buys, might be shutting its doors soon, which puts 12,000 jobs at risk. The store's been having a rough time, with fewer people shopping and some tough competition from other budget chains. Add to that the high rent they're paying for big spots on the high street, and it's a tricky situation. The company’s been working with Fieldfisher to give notice of its intention to appoint an administrator. (here’s a summary we wrote of the administration process)
🏡 Quinn Emanuel and Fried Frank (two US law firms) have given their London-based lawyers the option to work from home in August. This comes despite recent calls from big firms to ‘return to the office’ — and it’s been well-received by the staff. Other US firms, like Paul Weiss and Shearman & Sterling, did the same thing last year.
🕵️♂️ Adobe's $20bn (£15.7bn) bid for design software rival, Figma is being probed by the European Commission. They’re worried the deal might reduce competition in the digital design sector. While the Commission has okayed big tech deals before, Adobe might struggle to satisfy them on this one.
🔀 US firms in London are not only poaching talent from elite UK firms, but also by hiring from big names in private equity. Simpson Thacher recently nabbed Angus Lennox from Blackstone, highlighting a shift towards valuing private equity experience. Maybe UK firms will also jump on this trend.
📉 China's imports and exports took a bigger hit last month than people expected. Exports dipped by 14.5% and imports by 12.4% from last year. This is because of falling demand (as people struggle with rising living costs) and increased geopolitical tensions between China and the rest of the world. (if you read today’s featured story, you’ll understand the issues)
AROUND THE WEB 🌐
🎥 Cool: Ever had a movie on your mind but couldn’t remember what it’s called? Well, don’t worry — this tool uses AI to find it for you! (I tested it out and it worked for me)
💷 Explore: This website uses photos to show the daily lives of people at different income levels worldwide. It showcases over 300 homes from 52 countries, arranged by income, with the poorest at one end and the richest at the other.
🗞️ News: Catering to over 2.6m+ curious minds, 1440 delivers news as it should be — no slants, no biases and from 100+ reliable sources. Get it all in just five minutes every morning. Absolutely free.*
* This is sponsored content
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