Ambiguous data about law departments that “fired a firm in 2005”

Based on responses from 38 of the Fortune 250 general counsel, Corporate Counsel reports that 37 percent of them “did not fire a firm in 2005” (Corp. Counsel, Vol. 13, Jan. 2006 at 17). Companies in that elite bracket may have retained hundreds of firms during the year, so for nearly 40 percent of them to have kept the same herd goes to show the loyalty of law departments, their lawyers’ confidence that they choose firms wisely, and the capable performance of the firms.

But I want to make another point. To “fire” a law firm means to me to stop using a firm while it is in the midst of a matter. To fire a firm is not to cease using it after the matter it has handled ends; it is to terminate the representation in media res. What does this survey mean by the term?

About a third of the respondents (34%) said they had fired a firm during 2005 “for poor performance.” About the same percentage said they did so for some reason other than poor performance, technological capability (3% – one law department), or diversity (3%). Perhaps a disabling conflict, serious cost-overruns, departure of a key partner to another firm? It’s a poor survey that has “other” as such a commonly selected choice. Finally, why do the percentages not add to 100, unless some law departments fired more than one firm for different reasons.

Better to have asked, “how many firms did you fire in 2005 for these reasons?” Better still, calculate the number fired as a percentage of all firms retained during the year. As they stand, the metrics tantalize, but they are too fragile to bear the weight of scrutiny.

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