Managing Legal Straight Talk on Law & Lawyers for Senior Executives and their Boards
by Someone Who's Worked on Both Sides of the Attorney / Client Divide

Articles Posted in Negotiating w/ Your Law Firms

February 22, 2023

“Swept Up in ‘Awe,’ Legal Departments Fail to Push Back on Rates at Biggest Law Firms”

by Joel A. Webber

The Point

The above from a headline in Corporate Counsel (subscription required) last week.

Nathan Cemenska is an attorney who is Director of Legal Operation and Industry Insights at Wolters Kluwer ELM solutions. In a report issued earlier this month, LegalVIEW Insights volume 2023-1: Law firm rate increases, he contends that intimidation confines corporate Legal’s negotiation efforts to “where it matters least”:

“In smaller, less expensive firms where both rate increases and the underlying rate tend to be lower, limiting opportunities for savings …

“As long as corporate law departments continue to stand in awe of their largest firms and steer away from the application of any serious pressure to rates at the biggest firms, hourly rates at those firms will compound year over year and become outrageous by any definition.” Continue reading

September 30, 2022

Be an Informed Client of Your Company’s Law Firms: Signs of Softening Demand Should Inform Negotiations with Outside Counsel

by Joel A. Webber

The Point

Demand for large law firm services, after recovery from 2020’s Covid-induced setbacks to the economy, led to eye-popping rate rises in 2021, and record revenues for the firms.

Whatever market forces caused those rate increases and record revenues, they look like they may well be on the wane in Q42022. Large law firms’ recent, verifiable behavior reflects this.

Client companies should not hesitate to negotiate robustly with their law firms on rates. Beyond that, they should negotiate alternative fee arrangements based on mutually agreed value determined in advance of the work performed — not based on attorneys’ hours. Continue reading