Some of What I've Learned as an In-House Corporate Lawyer

I've been an in house corporate lawyer and an out-house corporate lawyer. I've been a litigator and a transactional kind of attorney. I have learned from these varied experiences that one of the ways an in-house law department can add value to an organization is in the litigation oversight function.

An organization's own legal counsel will, given the opportunity, take it to the cleaners and bill it dry. The bigger and more prestigious the firm, the more likely it is to churn your files and run up the bills. It's what they do. All the internal incentives of the firm are geared toward separating your company from its cash. This is easiest to accomplish in litigation where the process of discovery, dealing with experts and preparing for trial permits counsel to baffle the client and frighten them with the prospect of failure if anything is left undone or if any corner is cut. An experienced in-house lawyer can save the company a fortune by putting the brakes on unnecessary churning and avoiding activities that add little or nothing to the outcome of the proceeding.

Take the discovery process, for example. There are ample opportunities for lawyers to engage in ancillary battles over the minutia of discovery and whether the opponent is completely compliant and never misses a deadline. This is expensive and rarely helps. It can even hurt by pissing off the court and poisoning the well with opposing counsel. A client without a litigation manager might actually find his lawyer's aggressiveness comforting, and the lawyer is more than happy to comfort him day in and day out at hundreds of dollars per hour. Courts have enacted meet and confer rules to cut down on time wasting niggling over discovery because it is absolutely irresistible to lawyers to pad their bills with this kind of activity. In-house counsel will have none of this (unless of course your in-house counsel is a transactional dweeb with no litigation experience, in which case you might as well have no litigation management)at all). In just one major litigation, an in-house counsel can save the organization more than his costs in salary, benefits and expenses.

A good in-house lawyer will be able to manage more than one case and really add value. The key is for him to remember that he is not trying the case and that his oversight does not entail going over every pleading and document in the case. He has to keep his focus on the big picture and overall strategy and the desired outcome. The only things he will go over in detail are the bills. If the lawyers are so untrustworthy that he feels that he has to keep an eye on too many details, he should fire them and find someone he can work with.

The organization has to be on guard against having its legal department expand beyond its ability to add value. This can happen if the in-house attorneys are exercising too much oversight. There may be exceptional circumstances justifying some of these activities in rare cases, but any of the following is a sign of too much involvement in the litigation: (1) the in-house lawyer enters an appearance in the case; (2) the in-house lawyer attends depositions; (3) the in-house lawyer attends routine hearings; (4) the in-house lawyer writes any significant part of a pleading, memorandum or brief.

There are a number of ways to cut down on churning files without much effort by the in house lawyer. For example, research is a category under which a lot of overbilling occurs, so requiring that all research billed be accompanied by a written product cuts down on the temptation to add hours. Another way is requiring approval before embarking on any motion.

Litigation management alone is reason enough to bring on in-house lawyers if you have any litigation to speak of.