Community Perspectives: Inside Counsel - What are outside counsel doing wrong?

In-house legal professionals talk about how they manage in-house vs. outside counsel duties.

Community Perspectives: Inside Counsel - What are outside counsel doing wrong?

(Author) Attorney

In-house counsel: What are outside counsel doing wrong?

The central friction between in-house and outside is in-house wants work done efficiently and for less money than it costs and law firms feel in-house is arbitrarily cutting their bills.

What is most important to the business aside from money? Setting bad precedent? Keeping discovery limited to prevent copycat litigation? Settling everything early so plaintiff’s attorneys continue to target your company?

General Counsel Responses:

  • I got charged last week for 12 minutes. The task was to send an email with EINs for new entities. I’m not going to pay for that, and this only makes me angry. Forwarding me an EIN number is not a billable task. Let me edit this statement and be more clear. This can be a billable task, but there are a lot of firms that want the business that will NOT allow a bill to go through with this on it - I’ll let those firms do my work. To the extent it’s important, it was the only thing on a full month long bill from this firm. The firm did no other work on the invoice. It’s just a bad look and something I have to justify, as extreme pressure gets put on in-house counsel to reduce spend. Everyone knows I am being asked to cut legal spend, both because of the economic climate and because I’ve told them this. Then to get an invoice with a $200 line item that says “Send client EINs for entities - .2”, I’m just asking, “Wtf, guys? Put it on another bill”. This is such an easy way for the business to point us out as the problem. I’m working out my feelings about it, guys. I appreciate the opportunity to vent and get to the bottom of the anger 😂😂😂😂👍. So, I guess my point is: be practical about how you’re presenting the work you're doing to clients.

  • My two biggest peeves: 1) Charging me for hours of research I could have done in half the time (particularly if you use an expensive resource to do it). I use external counsel because I either assume you are an expert and not looking at this issue completely fresh, or because my team could do it but just don't have the time. When I know a question is probably 3-5 hours of research and you charge me for 12 hours, that really pisses me off. 2) Promising me you'll get something to me on a particular timeline and then not doing it. I give my teams time estimates based on that, and not meeting the promised timeline either puts me in a crunch or just makes me look bad. - We just rolled out Brightflag this month so I am hoping to see an improvement.

  • Emailing me on holidays.

  • Responses that only tell me what the law is and that we need to follow it. I need more nuance (What’s the likelihood and severity of consequences if we don’t adhere strictly to the law? What have they seen happen?) to help the business analyze the risk and make a decision. I don’t need to pay someone to tell me to comply with the law.

  • Way too many partners doing associate work.

  • I ask/pay outside counsel for a direction or best option based on their expertise and what they see across the industries as a best practice. By the time I’m going to outside counsel, I’ve already weighed all the risks and legal issues.

  • Not understanding the business they are advising. I see this even at the partner level, which is inexcusable.

  • Failing to give actionable advice for a given scenario

  • Not delivering on time even for relatively simple work.

  • Failing to provide a differentiated service - why am I paying you vs. the guy down the street who charges 1/2 to 2/3 the bill rate?

  • Billing fluff - I’ve seen it all.

  • Inconsistent quality, but this is very dependent on the lawyer.

  • Inefficient communication - I just want to talk to the person that can address the issue and also, this is 2023, there are alternatives to email.

  • Overselling expertise especially in niche/emerging areas of the law.

  • Overstaffing attorneys, nonresponsiveness (they literally never responded to my email despite follow-up and still billed me for it), and not sticking to work completion timeliness that they themselves communicated. “How much is too much?” There are exceptions but usually one partner and one associate.

  • The billable rate is too damn high!

  • If I make a minor (under $500) reduction to your invoice for excessive time, I don’t want to debate about how “reasonable” you believe the charge is.

  • A few things I saw as in-house that drove me absolutely nuts: 1) work that was obviously not reviewed (i.e., obviously junior work - like making conclusions in a statement of facts, or without much analysis, incorrect dates/docket number/etc.). 2) work executed with poor judgment, or without taking our company's interests to heart (e.g., a patent application that essentially discusses technological workarounds of privacy laws as an "invention"). 3) Failing to adapt to feedback (this one is HUGE - I don't write uncomfortable emails for my health; don't make me do it over and over for the same issue). 4) Flirting with ethics (especially when it comes to strategy/billing - you are a fiduciary. Act like it. If you think I can't see your non-impactful strategy, or your drawing out of a process, or your filing of unnecessary documents - basically nickel-and-diming me with ineffective stuff - think again). 5) Treating your own people poorly - if I catch wind that you're a jerk to work with, I will not send you work. Period. Law is plenty toxic already - I don't want to contribute to it, even tangentially. 6) Poor timeliness (this is probably the most common issue). Even the best brief becomes worthless, if it's late. I'm not looking for miracles or overnight turnaround, but if you have three months to do a 40-hour task, I expect you to get it done on time. 7) Short-sighted work (i.e., work performed with the assumption this contract/patent/NDA/work product will never see a courtroom, or where a strategy is implemented for a short-term gain, but at long-term expense, e.g., fudging a permit application to get it issued, but while knowing it could cause a problem if litigated). Anyway, that's just a few of the more common irritations I had with outside counsel; I could go on for a while, lol. Hope it's insightful and helpful.

Counsel Responses:

  • Charging too much for menial tasks.

  • I am not paying for external counsel to educate themselves at my company's expense. We were once billed for 2.5 hours of legal research done by a PARTNER (one of the biggest law firms in Poland - we considered Poland as a geographic expansion option).

  • I took pains to over-communicate and it’s shocking how much I have to chase people for whom I’m paying eye-watering rates.

  • They don’t understand what’s most important to me and the business (hint, it’s often not “winning” the case). Every other issue stems from that.

  • Ah, I love the long memo I didn’t ask for telling me the law I could figure out in 10 minutes of my own research.

  • It depends on the circumstances, but we’re typically far less concerned about the result of any one litigation than our outside counsel. The business is concerned about running the business. They want to resolve a litigation as quickly, cheaply, and with as little disruption as possible. Taking aggressive positions that are just likely to create discovery fights, not advance resolution of the case, and add to the cost of the case is a good way to get yourself fired (and not getting hired again is the same as getting fired). In 20+ years, I can count on one hand the number of outside counsel that even asked what our goal was in the litigation.

  • The number of cases where fighting fire with fire actually makes sense is extremely small. I will “fight and vigorously defend” the company if it matters. My point is don’t assume that’s what I want to do unless I make clear that’s what we want done.

  • Overstaffing. You don’t need six associates attending a virtual hearing. If you want them there to learn, fine, but don’t bill me for it.

  • Telling me the firm has partners who can advise on an area of law when, it turns out later, they really can’t. I get the impulse to position your firm as my one stop shop but don’t lie to me. I dropped a firm from our panel this year for such shenanigans.

  • Some big firm bid on a project I had. We set up an initial call, and the whole call was them promising to research the issue. Then they transitioned to telling me how they all used to work for the Clinton Foundation. I was like, dude, it’s a healthcare question.

  • Honestly, bad work product. Taking our standard master agreement and just wholesale copying and pasting sections of that into a client’s paper like it’s a paint by numbers. That is just going to be rejected by the other side (as it should, it’s very lazy). Instead of billing me 5 hours for useless edits, bill me twice that amount and do decent work. Also, having transactional/contracting attorneys draft settlement agreements at a higher rate than litigation associates. It is a very simple document any litigation associate can draft. If you want someone else to draft, fine, bill at the lower rate.

  • When they bill for reviewing an email, but never respond.

  • Slow work product with incredibly high fees. Also, that I’m having to go back and redo/enhance the work before delivering updates to senior management (legal and business). In one case, where outside counsel are noted national “experts” on a critical issue and I’ve only learned it in my 15 months on the job. We’re cutting ties with three big firms this year for high fees and/or bad or slow work.

Attorney and Associate Responses:

  • I used to be in-house counsel and went to BigLaw. Honestly, I FEEL FOR EVERYONE IN THIS THREAD. Going into BigLaw, I am annoyed by the amount of dumb stuff that I have to do to run up a bill. I literally made a questionnaire for a client to fill out a form (the questionnaire asked the same exact questions as the form basically) when I could have sent the form so the client had access to the information they need to fill out the form. I've tried pushing back and I'm met with “this is what clients want”. Outside counsel is brainwashed. I suggest making billing guidelines and giving them budgets for each assignment. I recently elected to go to a smaller “BigLaw” firm hoping that I have more control over not running up a tab for in-house folks since I would manage client relations with any client I bring in. 🫡 Stay strong.

  • I made the same switch (used to be in-house and now am in BigLaw), but I have the opposite impression. What’s insane to me is the amount of in-house who insist that I do administrative work for them. I mean, sure I’ll make that tiny change to one date and send you a redline. Or you could easily do it on your end and save yourself the .2? If I wanted something drafted differently, I’d draft it and send back saying “here are the changes”, not send an email asking me to make a list of changes unless they’re really substantive and I needed outside counsel to check my language.

  • I think the expectation that the lawyers doing the research are experts is off base. It’s likely the junior associates doing it, and we know hardly anything in the beginning (probably less than you to be honest), so it probably will take longer than it would for you to do it. How that should come off on a bill is another thing. Maybe the partner should be writing more off.

  • Outside counsel not being responsive was an absolute shock to me when I went in-house, particularly since I made being responsive a very high priority (which was the reason my client recruited me to come work for them).

  • I mean, just return my call and tell me when you’ll turn the work around. How hard is that?

  • Asking for calls and talking nonstop instead of just sending a markup.

  • Giving me a legal memo that fails to take a side when I need clear, actionable advice.

  • As a junior, I frankly don't want to do the nickel & diming tasks either. Billing a bunch of small .1- .3 is exhausting and patent professionals already have enough of that already.

  • Not giving diverse attorneys an opportunity to work on big ticket matters, over billing, handing off the work to staff, and not responding to emails in a reasonable time.

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