Recap: Working With My Law Firm(s): The New Dynamics

This was probably the most animated session during the two-day event - maybe it was the cocktail reception and songwriter's night that was to follow.

More likely, it was the issue at hand. The in-house attorneys in the room were all under at least a minimal amount of pressure to contain costs, and everyone had clearly examined their outside counsel relationships recently. The panelists had each taken different steps to modify their relationships with outside counsel, and each seemed to be pleased with the direction these relationships were heading.

Working With My Law Firm: The New Dynamics
Panelists: Senior attorneys from International Paper, SunTrust Banks, CVS Caremark
Moderator: Candice Reed (Executive Director, Counsel On Call)

Summary of Dialogue
Themes: Make your voice heard with outside counsel; We hold the power; We often know more about e-discovery than law firms do; Law firms need to budget/plan and work with the vendors we choose

Panelists began the session detailing how they, and many in the legal profession, believe that the law firm model is broken. The dialogue with the audience began immediately once this subject was broached, and many shared anecdotes about their relationships with outside counsel.

With that framework, one panelist said it’s important for a law firm – even firms you’ve been working with for years – to know you will walk away if their pricing or services are not inline with your needs. His department has moved to bidding out all of its work, and every law firm knows that there are at least two or three other firms bidding – and this has changed the way law firms look at the company (in a positive way). It has not changed the quality level of the work they receive (also positive).

Another panelist took this further and stated that involving her law firm in the decision-making process on the company’s e-discovery was not the best decision. The firm’s e-discovery committee was not up to the task, they did not have a disciplined approach and said that no matter who reviewed the company’s documents (namely: discovery attorneys), they were going to re-review them in order to sign off on the agreement.

Panelists them reiterated that in-house counsel must be willing to say, “Give me what I want” and stand up to law firms when necessary.

One specific anecdote that was shared with the group involved a recent conversation with a law firm partner, who was leading a company’s litigation strategy. The attendee loved the value he was getting from that partner, even at $500 per hour. But what he did not like – and what he wanted the partner to understand – was that along with every hour in that partner’s time came another $600 per hour in two junior associates a paralegal.

Another panelist said that we are in an evolutionary period right now, and that law firms must get their value proposition in order. He calculated that his company pays its in-house attorneys $150 per hour; if a law firm associate is doing work for his company, it needs to be at that price or less or it’s not worth it – they will do it in-house or use another vendor. Another panelist said a good practice is to staff a department at 80% of volume at $150 per hour.

From the audience, an attendee stated that she feels like she is educating law firms on every new case; they don’t know what a review protocol is, they don’t know how to track efficiency, and they are “very unsophisticated” when it comes to discovery. The group agreed, with one attendee stating that the way law firms manage a case and approach the discovery process is “with Concordance and brute force.”

The conversation then turned to law firm discovery centers. Several examples were provided, with one attendee citing one in which she “never saw the documents, but hasn’t heard anything bad” and a second matter in which she reviewed the documents and “it was horrible.” Another attendee said she had a good experience with one such center, but it was at three to four times the price she can do it for with Counsel On Call. One panelist remarked that the mark-up on these centers is ridiculous and sometimes uses the exact same attorneys as a company like Counsel On Call, which charges a very minimal mark-up.

One panelist said his department has the following requirements of law firms:

  1. No more than one lawyer at a deposition, hearing or event … he gets lots of pushback on this from the firms. (“Who will handle my papers?” I will, he says.)
  2. No first-year associates

Another panelist likes to budget matters over 90-day periods, and by asking law firms to do the same, the in-house department is able to determine what work can be done in-house that the law firm is budgeting. Another panelist stated that this approach – asking the law firm to plan – is a very positive step. The panelist also stated that staffing on any matter has to be approved and that the firm has to work with any third-party vendor the in-house department chooses (discovery attorneys or otherwise).

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