Possible misinterpretation of data on mid-size European companies and their law departments

Data from a recent study by LexisNexis Martindale-Hubbell deserves a quizzical quantitative qualifier. The study focused on how midsize companies in Europe select and review their legal service providers, and is reported in Of Counsel, Vol. 26, March 2007 at 8. The study defines "midsize" companies as for-profit organizations that employ approximately 50 to 600 full-time employees. One of its findings is supposed to excite amazement.

"According to the study, a surprisingly large proportion of European midsize companies have no dedicated internal legal department, with only 30 percent of respondent organizations employing in-house lawyers."

Is that finding jaw dropping? The median number of US attorneys per 1,000 US employees in large law departments is 1.5 (See my post of Jan. 27, 2006.) so if that metric holds even approximately among European midsize companies, even the largest respondents in the LexisNexis study would have had but one lawyer. Yet the survey population included 78 companies (41%) with only 50 to 100 employees, 61 (31%) with 101 to 250 employees, and only 55 (28%) with more than 251 employees. With such a heavy bias toward small companies, if the benchmark holds then very few companies would sustain an internal lawyer.

Upon analysis, therefore, what is surprising is how many of the sample, skewed toward small companies, have an in-house lawyer!