Rees Morrison’s Morsels #133 – posts longa, morsels breva

Recovery of legal fees for successful defense of the Crown’s criminal action. Law departments in the UK have the right to recover the legal fees they pay in defense of criminal charges, if acquitted. For example, the engineering firm Balfour Beatty and Network Rail, which runs the UK’s trains, recovered $33 million in legal costs from the government’s central funds pool after being cleared of manslaughter charges from a train crash. This right came to my attention in the IBA’s In-House Perspective, Vol. 5, July 2009 at 14. Since the applications for recovery may be public, they may constitute a database of fees paid and other external counsel management data (See my post of Sept. 21, 2009: bankruptcy fees, well-understood steps, yet value hard to pin down.).

Law firms and billing for travel time. One of the provisions in the Council on Litigation Management’s Litigation Guidelines (Appendix V, D) states that “Insurer agrees to pay 50% of the billing rate for all travel time in excess of 1 hour [presumably per trip]” (See my post of May 7, 2008: travel policies for outside counsel with 7 references.).

An article on how to implement value pricing in firms. Ron Baker of Verasage published a piece on pricing in the June 2009 issue of the Journal of Accountancy. His article explains an eight-step method for establishing a price, including what he describes as “the now infamous Nienbach model (a nine square thought experiment to aid in setting pricing options).” There is also a sidebar on price psychology. Legal departments can learn some ideas for how to pursue alternative billing arrangements (See my post of Aug. 21, 2009: value compared to fees paid with 22 references.).

When a C-suiter sweats a lawsuit – a good reason to hire external counsel. Regarding reasons to hire outside counsel, Bart Colli, the general counsel of Aramark, mentioned one in a PLI handbook regarding internal investigations (at 857). “Allegations involving senior management” is a time to turn externally because law firms “appear to be more independent and credible to government” and also there is a “greater likelihood of protecting [the attorney-client] privilege.”

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