Wouldn’t it make sense a priori that many who obtain the two degrees – an LLB or JD and an MBA – would gravitate toward the overlap of business and law – a law department? Someone could pore through directories and gather some data on the incidence of in-house lawyers who have the combined degrees.

Or do such students value and excel at academics, which draws them toward teaching? Then again, being hardworking and disciplined, do JD/MBAs end up as partners in a law firm?

Or do none of these outcomes dominate, as joint degree holders chuck the law and move into business? The resident advisor on my floor sophomore year, Jim Koch, got a JD and an MBA from Harvard, and now is the CEO of Sam Adams Brewing.

It’s one of my fancies to delve into histories of companies, old magazine and newspaper articles, and house histories of law firms – to name a few sources for archival digging – and to compile a historiography of US law departments. A previous post described my foray into TimesSelect NYTimes.com/Trial to look for early articles published in the New York Times that referred to law departments (See my post of Dec. 31, 2006.). John Grisham needn’t feel threatened by the page turner that this antiquarian foible may produce. But then, with Tom Hanks cast as the debonaire blogger….

Here are some tidbits, previews of coming attractions. AT&T early on had an internal law department: “C. P. CELEN, 64, PHONE EXECUTIVE; Vice President and General Counsel of A. T., T. Company Dies in Home Here LAW HEAD FOR 16 YEARS Served Government in World War in Litigation Over U. S. Control of Wire Systems,” Oct. 9, 1942, Page 21, 175 words.

A decade before, we find riveting evidence of a Boston & Maine legal team: “T. S. ALEXANDER DIES; PROMINENT ATTORNEY; Former General Counsel of the Boston & Maine Came Here From Boston,” Oct. 1, 1934, Page 17, 85 words. And to cap it off, this bouncy scene from US Rubber about a politico appointed to head the legal department: “U. S. RUBBER EARNED $10,000,000 IN 1920; Reserves Took Care of Sharp Declines-Tire Trade Now Almost Normal. JOHN W. DAVIS ON BOARD Ex-Ambassador to Great Britain Will Become Company's General Counsel.” April 20, 1921, Bus. & Fin., Page 27, 247 words.

The phone lines are open for advance orders for the seminal treatise, Morrison on the History of Pre-War US Law Departments, Volumes 1 through 4. The books will be better than the movie!

Discovering TimesSelect NYTimes.com/Trial and an invitation to search all articles published in the New York Times since 1851, I dabbled in some historical digging. Choosing the earliest period, 1851 through 1900, I searched for “general counsel” and looked at many of the 476 hits. They referred quite often to railroad companies or were obituaries of former general counsel. Here was a railroad story, and all that was provided at no cost: “News Of The Railroads, John K. Cowen Elected President of the Baltimore and Ohio. He Will Take Charge At Once. Mr. Cowen Will Resign as General Counsel of the Company, and Also as Congressman -- A Successful Lawyer,” Jan. 25, 1896, Page 15, 529 words. It was welcome to find an exception: “Looks Like A Rice Trust; But The General Counsel Of The Combination Says It Is Not,” Sept. 6, 1888, Page 1, 170 words.

I did learn that New York City had a law department 106 years ago: “The Law Department Of The Corporation; Reply of the Corporation Counsel to the Citizens' Association,” Nov. 22, 1867, Page 2, 5097 words. And two years later: “The County Canvass; Opinion of the Corporation Counsel on the Question of Counting the Votes for Supervisor.” Nov. 27, 1869, Page 4, 433 words.

A search on references to “law department” during the period turned up 1,003, but most of them had to do with the forerunners of today’s law schools, e.g., the Law Department of Yale University. One of the few exceptions was a short-track railroad piece, “Appointed to Central's Law Department,” Dec. 30, 1900, Page 24, 23 words.

“Legal department” fared even worse, with a mere 70 results. Here was one, and I include as much of the lead paragraph as TimesSelect shows: “Northern Pacific Lands,” Oct. 17, 1887, Page 1, 105 words -- Bismarck, Dakota, Oct. 16.--The Northern Pacific, through Mr. Dudley, of the legal department, filed in the local land office lists of large numbers of lands in Minnesota, in lieu of which the selections made in this district were … “

To complete my exhumation of related articles, I searched for “in-house lawyer” and “corporate lawyer,” which dug up zero articles; “in-house counsel” unearthed one article; and “chief legal officer” three results.

(1) Although they were used in the 1990’s, derivatives since then have become much more sophisticated and common.

(2) Although used in the 1990’s, derivatives since then have become much more sophisticated and common.

Variation 1 is wordy; the second variation has stylish brevity. When you see is, are, was, or were in a subordinate clause, seize the opportunity to eliminate them and streamline your writing.

A shared-services law department has three hallmarks. The head lawyer reports to an executive who runs the shared-services organization, which typically includes other units such as human resources or accounting. Second, and more important, clients can choose to use the shared-service lawyers or they can turn to outside counsel. This choice, and the market-based competition it engenders, distinguishes the shared-service model.

Last, and following from the second hallmark, shared-service lawyers charge their time to their clients. In one variation, headquarters lawyers do company-wide work such as securities, corporate secretary, major M&A; shared-service lawyers handle services needed from time-to-time by business units while on the payrolls of the units.

A pure shared-service structure for a law department is rarely seen. Senior management of corporations probably feel that if they want to have what amounts to an internal law firm they might as well use external law firms (See my post of Dec. 17, 2006 on the sole inside lawyer of Advo.).

Power corrupts and for some general counsel, secure at the top of the food chain, immersed in galactic issues, hobnobbing with rich and powerful Board members and executive VPs, flooded with invitations to declaim on their Olympian wisdom, pursued by journalists and puffed up by press clippings, it’s hard to sip lousy coffee from tin mugs with the NCOs.

But to the members of the law department, the physical presence, time, attention and concern of the general counsel has enormous importance. So, when GC Mid-Atlantic, Nov. 2006 at 9, profiled Henry Hopkins, general counsel of T. Rowe Price, it was refreshing to read that he “makes it a point to meet with each of the [16] attorneys in the legal department on a monthly basis, in the interests of promoting healthy avenues of communication and knowledge.”

“Promoting healthy avenues” may be purplish prose, but the idea stands: general counsel should all talk with their lawyers and paralegals regularly, listen to them (See my post of April 16, 2006 about the quality of listening.), and genuinely care about their well-being.

Here’s a man bites dog story from LSI newsletter: Ed. 33 – Dec. 2006. “Despite the ever increasing pay packages of many lawyers and a continuing growth in big firm profits, it seems that legal professionals may not be working as hard as they have been. According to a survey of 57 of the top 100 UK firms by PriceWaterhouseCoopers, the number of average chargeable hours worked by assistants [US: associates] fell by 3 per cent between 2005 and 2006.” (See my posts of Feb. 16, 2006 about net income per partner; Oct. 20, 2005 on whether to ask for data on billable hours; Nov. 2, 2006 on the worrisome aspects of firms with goals of 2,000+ hours; and Nov. 22, 2006 about the possibility that billable hour totals are exaggerated.).

Fewer hours logged did not improve job satisfaction. “Yet despite the drop in hours and increases in reward, attrition rates remained high. Over 40 per cent of the top 25 firms admitted to losing as many as a quarter of their 3-5 year pqe [post qualification experience] people every year.” High billable hour expectations and high turnover both cost law departments dearly.

Every year, the same basket of goods and services costs a bit more – retail price increases in recent years have run in the two-to-four percent range. Because of this trend, it’s misleading for general counsel to use nominal (raw) numbers to compare spending over a period of years (See my post of March 12, 2006 on nominal data, which is not adjusted for inflation.). For example, if a law department spent $10 million in 1995 on outside counsel and ten years later, in 2005, spent $12 million, how has it performed after adjusting for retail price inflation in the United States? According to an easy-to-use site, the original costs of legal services would have inflated to $12,759,083 – so the law department has actually held the line against inflation.

Whenever a law department shows and explains spending figures over multi-year periods, it should convert those figures to constant (inflation-adjusted) currency amounts so that the effects of inflation do not insidiously distort the analysis.

During my consulting career I have known only one calculation of “weighted average” (See my posts of Nov. 30, 2005 with my definition and an example; and Feb. 20, 2006 with an example from litigation.). I presumed you add up all of one figure from a set of law departments (such as numbers of lawyers in each department) and divide by all of another figure (such as company revenue). Ah, Rees, never presume, as it makes a presumptuous you-know-what of you and me.

It turns out there is a different formula to calculate weighted average and it does not reach the same result. Here is an example. To weight the ratio of lawyers per billion dollars of company revenue by revenue, multiply each company’s ratio by its revenue and add all those products. Then divide that total figure by the total of all the companies’ revenue. Excel has a built-in formula to help with the math.

Out of a research set of 1,124 US federal district court IP cases – 670 patent, 436 trademark, and 18 both – decided between 1980 and June 2005, “on average since 1983, plaintiffs … are awarded damages approximately 53% of the time” according to the 2006 Patent and Trademark Damages Study by PwC at 5. So much is written about the costs of patent lawsuits, especially, but law departments and their counsel fare quite well; plaintiffs can’t be too encouraged if they win barely more than one half of the time.

As to the vaunted litigation surge, the number of patent cases brought has climbed steadily from 1,171 in 1991 to 3,075 in 2004; for trademarks, the same timeframe saw an increase from 2,220 to 3,508 filings (id at 7). During those 14 years, corporate revenue in the US might well have doubled, or more, so IP cases filed per billion dollars of revenue appear to have roughly kept pace.

Finally, what amazed me (at 23) is that in “patent decisions, only about 30% of the damages decisions issued by US federal district courts during this entire period were affirmed (i.e., left unchanged by the appellate court.” We always read about huge awards, but less frequently do we read about those decisions being overturned, adjusted, or remanded. Therefore, in proportion to revenue growth, and adjusted for inflation (See my post of Dec. 31, 2006 on this calculation.), the numbers and damages of patent litigation appear less frightening than their usual description, and victory is had as often as not by those who are sued.