inhouse

Ten Things: Alternative Fee Arrangements – What In-House Lawyers Need to Know

I had a different topic in mind for this post and then someone sent me a screenshot from a fee request filing on Pacer (the federal courts’ e-filing system).  Here’s just a snippet:

FEES

This is not a joke.  You are reading this correctly – $775.00 per hour for first-year litigation associate lawyers.  $1,205.00 per hour for a third-year!  In a world that often feels insane, we’ve reached a new level of rate insanity when it comes to legal fees, especially those demanded by the mega firms.  If you are like me, you looked at this chart and then fell out of your chair, unconscious and involuntarily flopping on the floor like a dying fish.  Or maybe that’s just me?  Unconscious or not, there is a lot wrong with these numbers, but I do not want to spend 3,000 words bashing the business model of the mega law firms.  I know you all get it.  Hell, even the folks at Big Law get it – they just can’t change the trajectory.  But, the bigger questions to me are: (1) is this rate insanity sustainable, and (2) what can in-house legal departments do about it?  Personally, I believe that the number of clients who can afford these rates (or have matters justifying these rates) is shrinking, like George Costanza at the beach house coming out of a cold swimming pool.[1]  In other words, is a reckoning coming?

I have no idea.  These rates may, in fact, be sustainable.  The legal services marketplace seems to be immune to pressures other businesses face.  So, let’s just set that question to the side.  Instead, today I want to talk about – once you stop flopping around and get back into your chair – what in-house legal teams can do in response to rates like this.  In particular, I want to discuss alternative fee arrangements as I have been asked about these numerous times over the past month or so and they are likely to be (if done correctly) one of the most promising ways legal departments can get some control over the cost of legal services, especially when economic times appear to be as uncertain as they do here in the first half of 2023.  This edition of “Ten Things” will tell you what in-house lawyers need to know about alternative fee arrangements:

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Ten Things: Business Skills All In-House Lawyers Should Master

In my newest book, Showing the Value of the Legal Department, I include a section on the evolution of the role of in-house counsel.  I walk through the “dark ages” (lawyers in the basement alone and ignored) all the way to the current phase of “leaders/strategic thinkers” (using our lawyer superpowers to become valued partners to the business).   As I see it, the part of the role that has changed the most over the course of this evolution is the need for in-house lawyers to bring more to the table than just good legal skills.  Those are just your ticket to get into the circus.  To be successful, to be viewed as a partner to the business, and to get your seat at the big kids’ table with the filet mignon, you must also possess a set of key business skills.  How do I know this?  Well, I fumbled and bumbled my way through the process the hard way, i.e., I had to figure it out mostly on my own (but certainly – and thankfully – with the help of some key mentors along the way).  But I did figure it out and had a seat at the table as general counsel three times where I learned that the business had its own language (numbers) and way of doing things (business school) that were foreign to me given my legal background.  After thinking about it a bit, I realized that almost everyone at the table had a background in certain business skills that I did not possess.  Moreover, while everyone was more than happy to explain things if you asked; if you didn’t ask, they just assumed you were playing the same game they were playing, and it was on you to keep up with the class.  And, of course, like most lawyers, I was too proud to just up and announce that I had no clue about half the shit they were talking about.  Fortunately, I was smart enough to know I had to level up or I was soon destined for the little kids’ table and a nice Happy Meal of chicken nuggets.  So, level up I did.  And over the course of eight years of writing this blog, I have mentioned a wide assortment of business skills you need to succeed in the role.  But what I have not done is list all those skills in one post.  This edition of “Ten Things” corrects that oversight and sets out the ten essential business skills you must master to succeed as an in-house counsel.  And thanks to Marco Bijl, Head of Legal at Philips, for the idea:

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How to be a Practical In-House Lawyer

Lawyers, including in-house lawyers, have a well-deserved reputation for over-complicating things.  Don’t worry, this isn’t a sermon.  I am standing in the dock next to you, guilty as hell!  Still, I have spent time over the course of a long career in the law trying to figure out why this is.  Why is it that lawyers make things so hard on themselves and their clients?  I think it comes down to this: lawyers hate to be wrong. No, they fear being wrong, coupled with a belief that if you throw enough time, money, and words at a legal problem you can get to the answer or solve the problem.  This explains why lawyers write in a way that no mere mortal understands.  We have developed an uber-complex grammar structure that mystifies all but those foolhardy enough to plunge into the ocean of words, clauses, commas, “notwithstandings,” triple negatives, subparts, subparts to the subparts, and so on that make up modern-day contracts.  Or why our litigation process (in the US) is now largely an exercise in trying to get documents from the other side and prevent the other side from getting your documents and working overtime to get the court to sanction the other side for not giving you documents or for trying to unfairly get your documents, or… well, you get the point.

If you spend any time thinking about it, you begin to see why business leaders appreciate practical lawyers – lawyers who can get things done quickly and who can communicate in ways the business can understand.  The issue for in-house lawyers is that both demands tend to cut against all of our training and instincts, i.e., it’s hard!  Building “Rube Goldberg” machines is in our DNA.  Fortunately, it is possible to learn to be practical.  And, while not a hard and fast rule, my experience is that in-house lawyers who are practical in their approach and advice tend to thrive at companies and become sought-after partners to the business.  Those who are not, tend to be treated like lepers – feared and shunned.[1]  This edition of “Ten Things” brings the cure and discusses how to be a practical in-house lawyer:

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Ten Things: Best Blogs (And Other Media) for In-House Counsel (2021 Edition)

Well, here we are at the end of another year.  I hope all of you are having a wonderful holiday season.  As usual, I like to take a few minutes every December to reflect back on the year and take stock of where we are with the “Ten Things” blog. It’s been a busy year for me, but I have enjoyed every minute of it.  I have published my fifth book, Showing the Value of the Legal Department: More Than Just a Cost Center, I have been a guest on several podcasts (thanks!), I have put on a large number of presentations (live and via webinar), and – of course, I keep cranking out the blog.  Somehow, we’ve already started “Ten Things” year number eight!  As my mom often asks, “How the hell did that happen?”  And I am excited for 2022, with plenty of things to write about for at least one more year.  That said, I always love getting (and writing about) suggestions from you, so feel free to send them my way.

As usual, we will end the year with what traditionally has been a post about the ten best legal blogs for in-house counsel.  I enjoy finding and reading the work of great writers, especially the up-and-coming “next gen.”[1]  They have a lot to say and it’s worth reading! Like last year, I am going to shake things up a bit and add non-traditional bloggers, i.e., podcasts and LinkedIn writers to my list.  I am also going to (finally) list my “Top Ten All-Time Hall of Fame Legal Blogs,” just to give some love to blogs I am still reading after many years.[2]  Sometimes you just have to reward the wonderfulness of sticking around (right, Boomer?)!  So, with no further ado, this edition of “Ten Things” sets out my 2021 list of best blogs (and other media) for in-house counsel:

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Ten Things: Essential Issues for In-House Counsel (2021 Edition)

Welcome back, everyone!  I hope your holidays were joyful and restful (and COVID-free).  I was able to make a bit of a dent in the next book, so the ABA goons are leaving me alone… for now.  I did have some time to squeeze in the first “Ten Things” blog of 2021.  As usual, and like I did when I was general counsel, I like to start the year by sitting back and just thinking about all the crazy shit going on out there in the world and how it might impact my company and the legal team.  When I was in-house, I would use this exercise to help me plan out the year, set goals, and – most importantly – set some tripwires for starting to measure and balance risks to the organization.  So, I have been reading a lot, talking with in-house lawyers, and generally trying to figure out what’s hot and what’s not.  No surprise but it looks like a lot of last year’s list is still pretty relevant (click here to read the 2020 list).  But, there are definitely some new players on the field.  And, the idea here isn’t to figure out every possible thing that can cause problems or provide opportunity – that’s impossible (See COVID-19 for more details).  Rather, it is about doing your best to find a lens to help you anticipate the problems you can anticipate so that the issues that inevitably come out of nowhere are easier to deal with or do not hurt as much.  In other words, looking ahead to maximize value creation and minimize value destruction.  Also, you should know that my New Year’s resolution for 2021 is to be a bit more pithy with the blog.  We’ll see how long that lasts (maybe not even to the end of this one).  Anyway, let’s start the car and hit the road!  This edition of “Ten Things” takes a look at my predictions of the essential issues for in-house lawyers in 2021:

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Ten Things: The “Strategic” In-House Lawyer

As we come to the end of 2019, I wanted to write about an issue I hear a lot about.  In fact, in many of my conversations with in-house counsel, this is the number one topic, i.e., “how do I become a strategic in-house lawyer?”  While sometimes this is a self-generated concern, it arises mostly because someone (the CEO, the General Counsel, or whomever) told the lawyer during an annual review or another setting that they need to be more “strategic” with their thinking.  Sadly, that is typically about the extent of it, that is, “be more strategic.  Now go forth and sin no more.” From personal experience, I can tell you that receiving such a command from your boss without more is about as useful as a mud fence in a rainstorm.  But, as many in-house lawyers are learning, it is not enough to be an excellent lawyer with deep legal skills and institutional knowledge.  That just gets you to the table.  The business wants more out of its in-house legal department, especially from the general counsel and other senior members of the legal team.  They want you to be “part of the business” and they want you to be “strategic.”  Unfortunately, no one teaches you how to be strategic in law school – at least not when I was there.  For most, you just sort of figure it out as you go along.  That was my method.  I cannot tell you that I figured out the magical incantation that makes you a strategic thinker, but I have learned many relevant lessons over the years.  This edition of “Ten Things” shares my thoughts on how to become a strategic in-house lawyer:

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Ten Things: Escaping Meeting Hell

If you’ve been an in-house lawyer long enough you know that one thing as inevitable as taxes, death, and another Fast and the Furious movie is meetings.  Lots and lots of meetings.  Meetings you set, meetings you’re invited to, meetings with the boss, meetings as the boss, status meetings, “kick-off” meetings, post-mortem meetings, meetings with law firms, meetings about all the damn meetings you’re having, meetings… well, you get the point.  Some days you look at your calendar and it’s back-to-back-to-back-to-back meetings.  There is barely time to go to the bathroom, let alone get something to eat or just catch your breath (or Heaven forbid do some work).  Worst of all, sometimes you’re sitting in a meeting asking yourself “why the hell am I here?” or “what’s the point of this meeting?”  If you’ve had enough of the Alcatraz I call “Meeting Hell,” then read on.  Time for a jailbreak.

I’ve been around for a while and I’ve hosted a lot of meetings and I’ve attended a lot of meetings.  I’ve also found ways to get out of meetings or, if not, make them more productive and less painful.   This edition of “Ten Thing” discusses my tips for escaping Meeting Hell.  So, step into my cell and let’s have a chat.  And keep it down, the warden has ears everywhere:

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Ten Things: Simple Ways to Reward and Retain Your People

As I mentioned in my last post (January 8), over the next few weeks I will dive deeper into some of the sample department “goals” I set out in that article.  Today I will focus on this goal: “Build and retain extraordinary team with exceptional people.”  I always put my “people goal” first because I truly believe that nothing gets done in legal unless you have top talent that is motivated and happy in their jobs.  How do you keep and reward people so they stick around?  The obvious answer is to pay them well, have a good performance bonus program in place, and let them share in equity plans.  The problem is, for many reasons, it usually is not fully in your control to make any of these three things happen.  For purposes of this article, I am going to assume that you are doing what you can for your team around salary, bonuses and equity and, instead, focus on some low-cost ways you can reward/recognize employees.

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Ten Things: Help Your Client Get Their Contract Through Legal Quickly

A common complaint you will hear as in-house counsel is “Why does it take so long for you guys to review my contract?” (Second only to “Why are our contracts so long?”)  The answer, as you know, is complicated.  Legal is a limited resource, typically a small team that reviews hundreds and possibly thousands of contracts in any given year.  While a lot of contracts are fairly routine, many involve complicated provisions or transactions with millions of dollars on the line.  Sometimes you have to create a contract from scratch, meaning you do not have a form or something to easily model from.  Frequently, things like litigation or large M&A deals take up substantial amounts of lawyer time — time that cannot be spent on contracts.  Finally, legal will generally prioritize contracts based on the strategic objectives of the business.  Deals that better support the strategy/objectives get more attention more quickly.

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Ten Things: Your Company Has Just Been Sued. Now What?

It’s hard to recall a more disconcerting feeling than getting a copy of a lawsuit filed against your company.  If you have no experience with litigation, this can be a panic-inducing moment.  And no matter how experienced you are handling litigation, your stomach will start to flutter as you read through the allegations.

I was a litigator in private practice and I definitely saw my share of litigation, big and small as in-house counsel.  Over the course of that time, I developed a standard list of “things to do” when a lawsuit came across my desk.  I did this because it’s easy to forget some basic things you need to do up-front to put yourself in the best position to defend the claim. Below are ten things to do when your company gets sued (I have added links to additional resources in key spots).

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