You may have heard me say how much fun the practice of law would be without dealing with clients. (See June 2013 Post). They always seem to need something from you right now and, by the way, don’t always want to pay full price for on-demand services. Well, perhaps clients as the consumers of legal services have a point. Currently there are plenty of good lawyers around, even more than there is of good legal work to do. Perhaps there are now more lawyers than there is demand and the clients have experienced a shift in this balance.
More companies use inside General Counsel who act as the new trusted advisors to the companies, but with a business budget line to control. So, many trends and changes are afoot in the delivery of legal services and firms need to adapt. Things that can be done cheaper than using lawyers are simply outsourced. Young lawyers cannot be billed in some cases until they have some experience. More and more technology is required by clients to meet their needs, and the costs of that are not recoverable by the law firms. As they say, “it is what it is” and lawyers who want to be successful in the future must adapt and improve the delivery of their services to be competitive.
Routinely advocating change and the ability to adapt, I still push back at the commodity procurement driven approach of many companies — buying legal services like buying pipes. Cost cutting driven by the Finance and HR portions of companies sometimes result in “guidelines” that seem written by non-lawyers and have more restrictions than the professional rules. Caution is urged at this point, regardless of the market.
One speaker at the 40th ABA National Conference on Professional Responsibility referred to these company-imposed guidelines as a source of private regulation. He pointed out two main areas of concern: (1) client identity and (2) conflicts of interest. Some corporate guidelines say you will represent all of our affiliates and a conflict would exist as to each. Often we lawyers do not know and cannot determine who these hundreds of related parties may be. The guidelines views of what they say is a conflict may exceed both the case law and the professional rules.
Watch also these corporate guidelines for other hefty duties such as:
• Data security audits and other type random audits.
• Different file destruction requirements.
• Disaster recovery plans for firms.
• Breach notifications procedures and damages.
• Personnel background checks on all employees.
• Indemnity clauses that can cause coverage issues.
There is no cookie cutter response to these. I very much advocate a measured discussion and written exceptions to the guidelines when needed and possible. Some will throw their weight around and put the firm in a take-or-no take situation. Generally however, reasonable discussions can produce workable exceptions. Since the firm’s engagement letter is intended to meet its professional responsibility where it practices, a procedure that states the General Counsel and the firm’s designated lawyer agree to resolve any differences between the guidelines and the engagement letter seems fair. Placing the various affiliates in the firm conflict base for information and discussion purposes, but only representing the defined client in this matter may be a good compromise on the one-equals-all problem with regard to conflicts.
Despite being an advocate of law firms changing to adapt, there have been times when the guidelines were just so bad or unreasonable that I have said: “We do not deserve to be your lawyers.” Most however are workable. Just be very aware of what you are agreeing to by way of guidelines since a court may well conclude they were contract terms, despite being more than required in the law or rules.
More companies use inside General Counsel who act as the new trusted advisors to the companies, but with a business budget line to control. So, many trends and changes are afoot in the delivery of legal services and firms need to adapt. Things that can be done cheaper than using lawyers are simply outsourced. Young lawyers cannot be billed in some cases until they have some experience. More and more technology is required by clients to meet their needs, and the costs of that are not recoverable by the law firms. As they say, “it is what it is” and lawyers who want to be successful in the future must adapt and improve the delivery of their services to be competitive.
Routinely advocating change and the ability to adapt, I still push back at the commodity procurement driven approach of many companies — buying legal services like buying pipes. Cost cutting driven by the Finance and HR portions of companies sometimes result in “guidelines” that seem written by non-lawyers and have more restrictions than the professional rules. Caution is urged at this point, regardless of the market.
One speaker at the 40th ABA National Conference on Professional Responsibility referred to these company-imposed guidelines as a source of private regulation. He pointed out two main areas of concern: (1) client identity and (2) conflicts of interest. Some corporate guidelines say you will represent all of our affiliates and a conflict would exist as to each. Often we lawyers do not know and cannot determine who these hundreds of related parties may be. The guidelines views of what they say is a conflict may exceed both the case law and the professional rules.
Watch also these corporate guidelines for other hefty duties such as:
• Data security audits and other type random audits.
• Different file destruction requirements.
• Disaster recovery plans for firms.
• Breach notifications procedures and damages.
• Personnel background checks on all employees.
• Indemnity clauses that can cause coverage issues.
There is no cookie cutter response to these. I very much advocate a measured discussion and written exceptions to the guidelines when needed and possible. Some will throw their weight around and put the firm in a take-or-no take situation. Generally however, reasonable discussions can produce workable exceptions. Since the firm’s engagement letter is intended to meet its professional responsibility where it practices, a procedure that states the General Counsel and the firm’s designated lawyer agree to resolve any differences between the guidelines and the engagement letter seems fair. Placing the various affiliates in the firm conflict base for information and discussion purposes, but only representing the defined client in this matter may be a good compromise on the one-equals-all problem with regard to conflicts.
Despite being an advocate of law firms changing to adapt, there have been times when the guidelines were just so bad or unreasonable that I have said: “We do not deserve to be your lawyers.” Most however are workable. Just be very aware of what you are agreeing to by way of guidelines since a court may well conclude they were contract terms, despite being more than required in the law or rules.
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