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April 11, 2006

"That Lawyer Dude's" Advice to GCs on Costs, Real Quality and Real Life.

"That Lawyer Dude" (a/k/a Anthony Colleluori), and a few others, have commented on the April 7 post on Exemplar Law Partners and/or another post of the same day, One GC's View of the Billable Hour, in which James Holden, the San Diego-based GC of Rhino Linings USA, Inc., also held forth. Lively comments followed both posts. That Lawyer Dude's comments, reprinted in part below (click here for the whole thing), has some provocative but smart advice for GCs including a plea to them I've heard before: chuck your large law firm "litigators" and start hiring "trial lawyers". Overall, TLD's comments and his passion on the issue grabbed me. Although I didn't agree with his suggestion that firms should negotiate hourly rates (I think you do this rarely, and only in the expectation of high volume work), and a couple of other points, TLD got me thinking:

Most general counsel bring the hourly bill mess on themselves with their C/Y/A attitude. Stop bringing everything to the biggest, baddest, firm and start looking to smaller and better run firms that will appreciate your work. Look for firms where the partners and senior attorneys actually work on your case rather than review the work of others (or more precisely their billing sheets.) Stop thinking that the only lawyers you can entrust your affairs to have 100+ years combined experience. Stop Using Litigators and Start Finding Trial Lawyers.

Want to cut costs? Give bonuses to firms that come under your budget (note I said yours, not theirs). If they want your work in the future, they won't sacrifice your case for the bonus. On the other hand they will have an idea of what you think the case is worth. Stop looking for attorneys based on RFP and start looking at the bar journals, the seminars, and the court house scuttlebutt. (In other words get out of your chair and get to work looking.) Small or medium-sized firms do not spend time doing an RFP's....

Further, set a reasonable time period for the case to come to trial. It is unlikely that a case that is around 9-12 months will get billed as many hours as opposed to one that is around 18-24 months.

Demand a discovery PLAN that you must approve (not the same as a discovery schedule.) Find out how and what counsel is going after and see that they stick to the plan or change it with your permission only. Demand to do some of the work in house.

The billable hour is unfortunately the best way a trial law firm can be sure it will be around next year. Trial work has too many variables to predict how much a case will cost. It is a fallacy, at least on the small/medium firm level, to believe that the firm is seeking to churn its hours. There are a lot of clients to keep happy. Without the guarantee that a client will pay for work year after year, the firm cannot afford to neglect one client for another....

Negotiated rates, oversight, realistic budget goals, deadlines, and discovery plans, along with an open mind to new and different types of trial counsel, can cut litigation costs and provide success in the litigation. More work for General Counsel? Maybe. Worth the extra effort? Only General Counsel's year end bonus will tell.

Posted by JD Hull at April 11, 2006 02:31 AM


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