Articles Posted in Negotiating w/ Your Company’s Law Firms


The Point

From the tenth consecutive year of LexisNexis CounselLink® 2023 Trends Report: In-depth Perspective on Rising Outside Counsel Billing Rates:

1. Law firm lawyer and paralegal (“timekeeper”) rates increased in 2022 at the highest levels since CounselLink first produced the Trends Report, in 2013, with the average partner rate increasing 4.5% (relative to 3.4% last year and 3.5% the year before).

2. These record-high average rates of hourly rate increases were higher than in the previous year “in all tiers of law firms and in all practice areas“.

3. Keeping track of the proliferation of lawyers that outside counsel assign to a matter is a big challenge in managing outside counsel — the finding: “High numbers of billers are performing minimal work on matters.”

4. Alternative fee arrangements (AFAs / capped charges with related terms on success fees, etc.), if they were used, would be the chief antidote to the prevailing billable hour: but only an average of 12.4% of matters made use of AFAs last year. No growth from previous years. Continue reading


The Point

Purchasing power is the single most potent form of leverage available to a company that wants to keep law firm fees within manageable bounds. But passive acceptance — not robust negotiation — is corporate Legal’s typical response to law firm price demands.

In the 1st Quarter of 2023, predictions of the largest law firm rate increases in 15 years abound — see here (“Those Predicted Big Biglaw Rate Increases? They’re Going To Be Bigger” / Above the Law 1.19.2023 — 7-8% increases in 2023), here (“Raising Billing Rates in 2023 Becomes ‘Singular Focus’ for Law Firms” / American Lawyer Media 11.22.2022 — 7-8% increases in 2023), and here (“Rising Rates are Law Firms’ Salve Amid Layoffs, Pay Cuts” / Bloomberg Law 1.19.2023 — 8% increases in 2023).

2023 is not the year for your company’s Legal function to be pushed around in such rate negotiations. Those who bargain on behalf of your company should do so keenly aware of market demand vulnerabilities now facing law firms on the other side of the table from them. Continue reading

Contact Information