Second opinions from outside counsel, confidence in inside counsel and CYA

Data has yet to come to my attention about how often law departments request from their law firms what US lawyers refer to as “formal opinions.” The law firm’s malpractice insurance backs up a firm’s formal opinion letters. Outside of mergers (See my post of Nov. 9, 2006 on UK law firms and liability caps.) and patent infringement analyses, such letters are probably rare.

Less formal second opinions, however, can be sought by law departments at any time and vary considerably in their purpose and cost, but serve mostly to corroborate the internal judgment of law department lawyers. Such comfort is not so rare.

In fact, one cost spigot that a general counsel can turn off is too much checking with outside counsel. Sometimes a firm’s expertise, research skills, and experience across several companies justifies another head, but too frequently done it betrays lack of confidence in the abilities and judgment of the inside lawyers.

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