In House - The FindLaw Corporate Counsel Blog

November 2010 Archives

Decade's Biggest Trends for In House Counsel

Wondering just what are the big trends amongst in-house counsel over the past decade? You are in luck, as the results are in.

As great changes in the economy and technology force all sectors of the legal market to re-evaluate how they do things, in-house counsel is no exception. Recently, WestLaw Insider reported on the 2010 ACC/Serengeti Managing Outside Counsel Survey Report, detailing the trends for managing outside counsel and what really matters to corporate practitioners this year and this decade.

Here, in the tried and true what's "In and Out" format is brief look at what is important to in-house counsel:

In House Legal Spending Slashed 25%

In light of the challenging economy, corporations are seeking to cut costs. One place where you can expect to see cuts are within your own legal departments. According to the ABA Journal, general counsels are looking to cut legal spending by 25% this year. The article, entitled "25% Cut in In-House Legal Spending Translates to Even Deeper Cuts for Outside Legal Work," discusses how and why legal spending will be down in 2011.

Specifically, most in house legal spending decisions boil down to this: is it cheaper to handle the problem in house or to use outside counsel? An ABA Journal columnist says it is almost always cheaper to use in house counsel.

In House Counsel Salary Increases Slow Down

What goes up must come down. Looks like Newton's law of gravity also applies to in house counsel salary as a recent survey indicates that the in house counsel salary increases are slowing. In a survey conducted by Hildebrant Baker Robbins, the average seniority level in house counsel salary is a cool $174,000.

Although that figure may be less than what many associates at big law firms are earning there are two upswings to the in house counsel salary -- not working under outrageous billable hour requirements and typically receiving much larger bonuses than law firm associates. In 2010, the average in house counsel bonus was $57,000. The salary figures did represent the smallest percentage increase seen in the industry in the last six years, with only a 2% jump from the previous year.

In House Counsel Shouldn't Have to Sit for NY Bar?

Who wants to have to take the NY bar? No one, is a pretty safe guess. Bar exams are expensive, time consuming and frustrating. But if you want to practice law in a state, there's just no way around that.

Or is there?

In-house counsels in New York don't want to take the exam, and New York State Bar Association is backing them up. They have asked the Court of Appeals to allow in-house counsels with a continuous presence to be allowed to practice law without taking the bar exam. However, in-house lawyers would still have to pay the $375 lawyer registration fee, naturally. They would also have to comply with continuing education rules and state disciplinary rules.

Former Glaxo General Counsel Indicted For Cover Up

The indictment of a former Vice President and General Counsel of GlaxoSmithKline, Lauren Stevens, is newsworthy beyond the individual allegations affecting the ex-executive. This prosecution may be the first wave of a sea change in how the government pursues not just companies, but company executives for wrongdoing. Stevens was charged in connection with her actions the Department of Justice says obstructed a federal investigation regarding GSK's promotion of the drug Wellbutrin for off-label uses.

This is a long-promised change in strategy, reports The New York Times. Pharmaceutical companies have been the target of many investigations regarding the promotion of their drugs for off-label uses, but until now, the individual executives and corporate counsel have not been under fire in the same way. "This is absolutely precedent-setting -- this is really going to set people's hair on fire," said Douglas B. Farquhar, a Washington lawyer who recently presided at a panel on law enforcement during a drug industry conference.

Alternative Fee Arrangements Becoming More Popular

Billable hours are still king of the castle when it comes to law firm billing. Alternative fee arrangements, however, are increasing in popularity for a variety of reasons, according to The Metropolitan Corporate Counsel. The alternative billing scheme can be a benefit to both a firm and clients.

Some 56% of in-house counsel polled in a recent survey responded that alternative fee arrangements may be here to stay. Why? Because they often provide a more predictable measure of costs to clients. Although this may not necessarily translate into savings for a client (or losses for a firm), it can serve to keep business coming in -- a welcome sign for many firms hit hard by the recession.

New Book Reveals Why BofA General Counsel Was Fired

It turns out that General Counsels aren't the untouchable, super powerful figures some people think they are. A new book detailing the fall of Merrill Lynch sheds some interesting light on how swiftly things can come crashing down. Crash of the Titans: Greed, Hubris, The Fall of Merrill Lynch and the Near Collapse of Bank of America. This verbose title is a new book by Greg Farrell, who takes readers through the life of banking general counsel Tim Mayopoulos.

Mayopoulos served as general counsel to Bank of America just hours before the company acquired Meryll Lynch under somewhat questionable circumstances. The book quotes one lawyer working on the merger which aptly sums up the chaotic scene, "um, well you are the third general counsel I have reported to today." Bank of America purchased Merrill Lynch for $50 billion in 2008.

Former General Counsel Hired to Run New York Mets

Here's a story for all you disillusioned law students and crusty old practicing attorneys. If you play your cards right, you can become the general manager of a sports team!

After all, Sandy Alderson made the jump from being the in house attorney for the Oakland Athletics to the team's general manager in 1983. And unlike countless others, he wasn't a total washout. To the contrary, he helped take the team to a World Series in 1989. Now Alderson is set to switch coasts: he is joining the New York Mets. Alderson has been tapped to serve as the Mets general manager.

The Mets have been in a free fall for several seasons and Alderson is being brought in to help the team in its quest to turn things around. Alderson said the Mets are interviewing internal candidates for a new manager this week, with interviews with outside candidates set to begin next week, ESPN reports.

Law Firms Pump Millions Into Midterm Campaigns

As law firms continue to pump big money into elections and politics, in house counsel increasingly finds itself involved in lobbying activity. Business groups, businesses, lawyers and lobbyists have invested millions in the midterm campaigns alone. The political action committees of the top 10 law firm and lobbying firms donated $5.5 million to federal candidates alone, The Washington Post reports.

That figure does not take into account expenditures made by an organization on behalf of a candidate or individual contributions from firm employees, which could as much as double the $5.5 million figure. With the substantial contributions, firms are positioning themselves as political powerhouses.