Inside counsel and a review of their management of outside counsel

If a general counsel wants to assess how well the lawyers in the department manage outside counsel, answer these questions:

Relative to peers or some other benchmark, how frequently does a particular lawyer call upon outside counsel? When measured, this rough figure amounts to outside spend per individual in-house lawyer. Usually only one or two lawyers review and approve the largest amount of external fees. Obviously, the general counsel must take into account the responsibilities of the lawyer such as that litigators are commonly promiscuous users of law firms.

What are the effective billing rates of the law firms used by that lawyer and what has the trend year over year been (See my post of June 13, 2006 on blended billing rates and effective billing rates.)?

How many law firms did the corporate counsel use over a period of time and with what concentration of spending? The corollary is to look at the dollars taken off bills or the discounts arranged with law firms.

What are the law firms’ assessments of how clearly the lawyer instructs them what to do and how timely and effectively the lawyer makes strategic decisions?

Has the lawyer obtained budgets on major matters and what have been the firms’ performances against those budgets?

Results are notoriously had to evaluate and it is to my way of thinking wrong to look at amounts knocked off law firm bills. The percentage of bills paid on some basis other than hourly billing (or discounts from that) could play a role, but not every lawyer in-house has the same maneuverability in that arena.