1. ACC – Charlotte Chapter November 2, 2016
Managing Legal Spend
ACC – Charlotte Chapter
November 2, 2016

2. Approaches to Managing Spend What Works Best? Beyond the Billable Hour
Today’s Topics
Approaches to Managing Spend
What Works Best?
Beyond the Billable Hour

3. Common Approaches Outside Counsel Guidelines Approved Counsel Lists
Legal Project Management
Blended Rates

4. Outside Counsel Guidelines
ACC Model – 4 pages:
0.1/hr. (6 min) increments
Only 1 timekeeper for conferences
Large Pharma Co. – 39 pages:
All legal research billed at 2nd yr. associate rates
Proprietary task codes required, even for flat fee work

5. Approved Counsel Lists
Useful as a quick reference list
Tracks lawyers/firms who have achieved favorable results, added value and understand the company
Generally should not be used to exclude appropriately qualified new counsel

6. Legal Project management
Define a matter’s scope:
Goal
Description of work
Staffing
Schedule
Budget
Monitor status and budget
Address changes in scope
Analyze matter outcome

7. Blended rates Agree to a single rate for all time keepers
Blended rate more palatable to others
Distorts incentives for work allocation

8. What really makes a difference?
Budgets, especially by phase
Early discussion of costs and fees
Control over staffing
Alternative Fee Arrangements (AFAs)

9. It’s about time

10. Today’s Law Firm Environment

11. The Trusted Advisor, Charles H. Green

12. Alignment

13. Predictable Fees

16. Transactions Transactions Department Service Offering
Revenue Opportunity
Supplement General Counsel/Assistant CG
Monthly/quarterly retainers
Value-Based Transactional Work
Flat-fee engagements with defined scope
Contract Management Services
Subscription or per-document/page prices

17. Regulatory ARGA Practice Group Service Offering Revenue Opportunity
Chief Compliance Counsel
Monthly/quarterly retainers
Regulatory Reviews/Checkups
Flat-fee engagements with defined scope

18. Intellectual Property
Intellectual Property Department
Service Offering
Revenue Opportunity
Chief Patent Counsel
Monthly/quarterly retainers
PTO Searches, Patent Application Prep, Prosecution, and Filing
Flat-fee engagements with defined scope
PTO Litigation
Value-based goal-aligned pricing

19. Litigation Litigation Department Service Offering Revenue Opportunity
National/Coordinating Counsel
Monthly/quarterly retainers
Legal Process Consulting
Project-based flat-fee engagements
Second Opinion Advisory Services
Project-based flat fee engagements
Traditional Litigation
Value-based goal-aligned pricing

20. Developing Budgets using Monte Carlo Simulation
Metric
Triangle Distribution Data Points
Partner
Associate/
Of Counsel
Paralegal/
Legal Assistant
10th Percentile
Minimum
$15,587
$1,626 $0
50th Percentile
Likeliest
$125,513
$49,251
$3,718
90th Percentile
Maximum
$634,272
$296,397
$28,590

21. Partner Fees Percentile Total Fees 10% $98,000 50% (Median) $238,000
90%
$456,000

22. Associate/Of Counsel Fees
Percentile
Total Fees
10%
$39,000
50% (Median)
$105,000
90%
$211,000

23. Paralegal/Legal Assistant Fees
Percentile
Total Fees
10%
$3,000
50% (Median)
$10,000
90%
$20,000

24. Total Fees Percentile Total Fees 10% $200,000 50% (Median) $369,000
90%
$595,000

25. More to Consider Second Opinions Contingency Pricing
E-Discovery Vendors /Comparison
Process Analysis
Secundment
Inside counsel / Outside counsel /Legal Service Providers

26. Mark P. Henriques Phone: (704) 331-4912 E-mail: mhenriques@wcsr.com