Law Department Management Blog
The source of the quote came from the Jan. 2009 issue of the California Lawyer. “A survey by the Corporate Executive Board found that large-company spending on law firms grew by 49 percent between 2002 and 2005.” OK, ten percent a year during the boom years following a recession. It’s the next sentence that has been mis-used. “ And while non-law firm costs increased by 20 percent over the past 10 years, large law firms’ prices jumped almost 75 percent in the same period.”
A later quote by ACC asked no questions: “According to a recent issue of the California Bar Journal, a survey by the Corporate Executive Board found that “while non-law firm costs increased by 20 percent over the past 10 years, large law firms’ prices jumped almost 75 percent in the same period.” What size is a large firm? How was the survey conducted? Are “prices” standard rates or effective rates? What is the basis for the 20 percent increase figure? In short, how much should we accept from the quote?
By a year or so later, in an article published May 17, 2010 by Law.com, the author neither interrogated the supposed finding nor stuck to its wording. The author dropped the survey origins in favor of “a study,” zeroed in on “U.S. companies,” and generalized the large law firms’ prices to “legal costs.” The author [cited] “a study conducted by the Corporate Executive Board which found that costs to U.S. companies have risen 20 percent over the past decade. During the same time period, however, legal costs have risen 75 percent.”
With no effort to understand the underlying data and with polishing and smoothing the findings, we now have the extremely alarming claim that “legal costs” have risen 75 percent. A questionable finding has been warped to serve as a sound byte and may soon become perpetuated everywhere as a commonplace.