Articles Posted in Thoughts/Observations

They hyper-active Paul Lippe of Legal OnRamp continues to embrace new collaborations. Recently, GC Roundtable linked up with his online network and now a major vendor to legal departments has joined. I learned about this from Charles Christian’s American Legal Technology Insider, March 2010.

CT TyMetrix “announced a partnership with the legal networking site Legal OnRamp. As part of this relationship, TyMetrix will set up an online facility within Legal OnRamp, called DataPoint, that will help corporate legal departments to better understand their data and more effectively manage their legal spend.”

LegalOnRamp can move quickly, one of the benefits of being a nimble and creative organization driven to transform the legal industry, and it is on a trajectory to meld in other organizations that want to harness the ‘Ramp’s Web 2.0 capabilities and high-end membership.

Recovery of legal fees for successful defense of the Crown’s criminal action. Law departments in the UK have the right to recover the legal fees they pay in defense of criminal charges, if acquitted. For example, the engineering firm Balfour Beatty and Network Rail, which runs the UK’s trains, recovered $33 million in legal costs from the government’s central funds pool after being cleared of manslaughter charges from a train crash. This right came to my attention in the IBA’s In-House Perspective, Vol. 5, July 2009 at 14. Since the applications for recovery may be public, they may constitute a database of fees paid and other external counsel management data (See my post of Sept. 21, 2009: bankruptcy fees, well-understood steps, yet value hard to pin down.).

Law firms and billing for travel time. One of the provisions in the Council on Litigation Management’s Litigation Guidelines (Appendix V, D) states that “Insurer agrees to pay 50% of the billing rate for all travel time in excess of 1 hour [presumably per trip]” (See my post of May 7, 2008: travel policies for outside counsel with 7 references.).

An article on how to implement value pricing in firms. Ron Baker of Verasage published a piece on pricing in the June 2009 issue of the Journal of Accountancy. His article explains an eight-step method for establishing a price, including what he describes as “the now infamous Nienbach model (a nine square thought experiment to aid in setting pricing options).” There is also a sidebar on price psychology. Legal departments can learn some ideas for how to pursue alternative billing arrangements (See my post of Aug. 21, 2009: value compared to fees paid with 22 references.).

In case you missed them, here are the “Editor’s Choices”:

Survey your law firms, but observe some courtesies (Jan. 5, 2010)

Your firms can provide all kinds of information to you, but ask judiciously and always share the feedback

Oops, I have egg on my face.  I divided numbers of lawyers by 5  instead of multiplying by .05.  Big oops.

So the original header said "40,000" but should have said "10,000".  I will deal appropriately but sternly with my fall-down-on-the job staff of fact checkers!

Rees Morrison

The “world rank” of this blog, Phi Beta Blogga, and other memorabilia. According to SiteLogr.com, on February 11th, the “world rank” was 1,256,081. Now that the applause has died down, it can also be revealed that this site placed an “Estimated Value” of $1,353 on my pride and joy and estimated reasonably accurately that “Visits Per Day” was 618. According to HubSpot’s Website Grader on Jan. 22, 2010, this blog had a Google Page Rank of 4 (PR 4) and its traffic rank according to Alexa is in the top 4.916 percent of all sites (1,528,666 rank). “Inbound Links” number 3,826. My “Blog Grade” is 94 (Phi Beta Blogga), which is “based on a measurement of traffic levels to your blog and the number and quality of links pointing at it.”

Are there tens of thousands of law departments in the world? Michael Bond wrote me on LinkedIn on Feb. 9th. “It is mandatory to belong the Belgian In-house Counsel Association; they have 1,300 members. The population is 10m so multiply by 30 [to match the 310 million or so population of the US and] you have about 40,000 in-house.” I do not know whether Belgian lawyers in government agencies are also required to belong to the Association.

One out of seven lawyers in Fortune 500 legal departments are women. Legal Tech. News, Feb. 2010 at 29, reports that “14% of Fortune 500 in-house counsel are women.” I would have thought the percentage was much higher. Many legal departments I advise seem to be closer to 30-40 percent women lawyers.

For those readers who have endured or been affected by the monsterous snowfalls on the East Coast, here is what my house looked like from the igloo next door.

Fortunately, neither rain nor 22+ inches of snow keep this blogger from his duly appointed posts. Long bouts of shoveling does, however.

Attorney-client privilege may soon apply to in-house lawyers in France. As reported in the European Lawyer, Issue 92, Jan. 2010 at 21, the Rapport Darrois proposes to allow lawyers who go in-house to remain as members of their local bar, and thus afford their clients the protection of the attorney-client privilege. If that change comes about, a similar shift might spread throughout the European countries that deny them the privilege (See my post of Feb. 16, 2008: attorney-client privilege with 18 references.).

Mushroom-like growth of LPOs in India. A post two months ago referred to estimates of more than 100 legal process outsourcing providers in India in 2009 (See my post of Dec. 1, 2009: refers also to an organization formed by such providers with more than 80 members.). An article in the European Lawyer, Issue 92, Jan. 2010 at 37, states that in the Gurgaon area alone there were in 2008 more than 180 LPOs.

A challenging integration of a legal department in Russia. An article about Stephen Polakoff, general counsel to the Russian oil giant Integra Group, includes comments about eye-opening decentralization. Polakoff explains that “initially the legal department was quite large because we had more than 80 legal entities … when I joined in February 2007. Each of these acquired entities came with its own lawyers, accountants and corporate culture …” Unfortunately, the European Lawyer, Issue 92, Jan. 2010 at 16, tells us nothing about the number of lawyers in the department now. Somehow I doubt the number is near 80.

Laura Stein, the general counsel of Clorox, describes her role and department in Practical Law, Feb. 2010 at 96. From that profile we can make several comments.

Benchmarks. The $5.3 billion company employs 30 lawyers, which means slightly fewer than six lawyers per billion. That seems somewhat higher than one would expect from a consumer products company, but you can’t say anything meaningful about the benchmark metric until you know what the company spends on outside counsel.

Unusual support staff. Stein says that support for the lawyers comes from “paralegals, administrative assistants, project managers and clerks.” The reference to “project managers” intrigues me but I have no idea what they do. “Clerks” could be law school students or interns. Or, more likely, the term applies to file clerks or records clerks, possibly trademark clerks.

I picked these out of around 95 posts in November on my blog. Click on the link to read the full post.

Seven variations on rate freezes from the traditional choice of one or two years (Nov. 17, 2009)

Seven ideas, all eligible for variations and combinations.

An early and focused in-house litigation lawyer (Chanel 1928). According to a review in the London Rev. of Books, Jan. 7, 2010 at 33, early in her business career the legendary Coco Chanel struck what she felt was a terrible deal with the businessmen who marketed her perfumes. By 1928, four years after the agreement took effect, the businessmen “had an in-house lawyer who dealt exclusively with the lawsuits instigated by that ‘bloody woman’…”

More than 80 risk management frameworks. An article in Int’l In-House Counsel J., Vol 2, Autumn 2009 at 1403, discusses in-house counsel and risk management. Early on, it states that there are more than 80 risk management frameworks reported worldwide and gives a citation. The author of the article, an in-house attorney in China, then proposes an overly ambitious goal: “The in-house legal counsels should periodically perform an overall assessment of all legal risks impacting the business operations, and report to the general counsel on the status of these risks and actions to control them” (See my post of Jan. 19, 2010: too broad an expectation about legal risk management.).

Fragments on Microsoft’s Legal & Corporate Affairs department. The Columbia Law School Mag., Winter 2010 at 30, has a short profile of Brad Smith, Microsoft’s top lawyer. It mentions that he oversees a staff of roughly 1,000 that has attorneys in 44 countries. Smith is also the company’s chief compliance officer and “is responsible for the expansion of Microsoft’s philanthropic activities.” It is ironic that the head lawyer, who strives to protect the company’s assets, also leads the company’s group that strives to give away company assets, the philanthropy group (See my post of June 16, 2009: General Counsel of Bristol-Myers also ran corporate philanthropy.).