Articles Posted in Thoughts/Observations

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When I have written about the law departments of government agencies, mostly I have marveled at the size of them (See my post of Sept. 10, 2005: New York City’s Corporate Counsel Office, more than 650 lawyers; Nov. 6, 2005: US Department of Homeland Securities, roughly 1,500 lawyers; Pennsylvania’s Office of the General Counsel, 700 lawyers several years ago; May 10, 2006: legal advisors to the U.S. Department of State, 165; Aug. 2, 2006: State of Massachusetts, something like 650; Dec. 3, 2006: New Jersey Attorney General’s Division of Law, 580 lawyers; Feb. 16, 2009: FBI, 180 lawyers; March 11, 2009: United States Postal Service, 220 attorneys; and Dec. 14, 2011: U.S. Air Force with 1,500 lawyers.).

Just the references in the last paragraph, stumbled upon by happenstance, support surmises that (1) the largest law departments in the country support government agencies and (2) thousands of governmental legal departments exist in the United States (See my post of Dec. 20, 2011: government lawyers outnumber private sector two to one; and Dec. 31, 2008: 9% of lawyers in large U.S. survey identified themselves as government lawyers.).

Also regarding governmental legal teams, one post here referred to several that had faced internal audits of their teams and processes (See my post of May 31, 2005: Austin, Texas; Dec. 23, 2005: Pierce County (Washington) Prosecuting Attorney’s Office; March 26, 2007: Hernando County, Florida; May 19, 2006: LA’s Office of the City Attorney; Jan. 20, 2006: California Department of Transportation’s Legal Division; and Dec. 18, 2006: Amtrak.).

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Private equity firms invest in the legal cottage industry. This is a good thing for general counsel, because those firm inject capital and management experience, but it’s bad if potential acquires take their eye off the ball, if investments lead to turmoil, or if private equity acquirers fail to maintain experienced employees and quality service. On balance, it seems to me, new ownership and capital leads to improvement.

I have collected a few examples of investments by private-equity firms in law department services. Beacon Equity Partners owns Exari after an investment in 2008. The same website mentions its investment in Anaqua, a patent management company, and a press release from 2010 describes Anaqua merging with SGA2.

Another example is the recent purchase of Mitratech (See my post of Nov. 1, 2011: Vista Equity Partners acquires matter management firm.). A bit later Cinven bought into CPA Global, a company in the IP and offshoring space (See my post of Feb. 9, 2012: Cinven acquired CPA Global.). Project Leadership Associates (PLA) was also acquired by an investment group (See my post of Feb. 9, 2012 #2: two private equity investments mentioned.).

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Distinctions among law departments by market value? ISS, the rating agency, has announced that it will judge companies against a peer group of 14 to 24 companies, based on industry, revenue and market value. It is unclear to me how the market value of a company has an effect on anything about how a law department operates or vice versa (See my post of Aug. 8, 2011: collects four posts on lawyers per billion dollars of market value.).

Surveys that may get more than one respondent from a department. An invitation to a survey was distributed by ACC and MCCA to approximately 10,000 in-house lawyers. Although data was collected from December 2010 through April 2011, only one response per law department was accepted. If multiple responses came from the same law department, which one did they pick? Did they choose by title, first in, fullest data set (See my post of July 21, 2008: survey methodology with 40 references, 25 internal references.)?

The nominal fallacy. We succumb to error when we think that if we name something the name carries explanatory meaning. This error is called the nominal fallacy and is referenced in John Brockman, Ed., This Will Make You Smarter (Harper Collins 2012) at 62. If you talk glibly about a “discount” you may feel that once you have named the arrangement with a law firm with that term you understand it better. You think the term “discount” itself carries explanatory meaning, but that is wrong thinking. This blog has correctly pointed out other fallacies (See my post of March 23, 2006: sunk-cost fallacy; Aug. 22, 2006: fallacy of induction; Jan. 18, 2008: fallacy of misplaced concreteness; March 15, 2009: fallacy of conjunction; April 2, 2009 #4: special pleading as logical fallacy; and Aug. 18, 2011: teleological fallacy.).

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Legal hold software and a cost metric for law departments. Consider an item from KMWorld, Feb. 2012 at S12. “BIA’s legal hold compliance SaaS solution costs less than $2 per user per month.” Does that mean per employee or only per employees who are “custodians.” If that metric can serve as a lodestone for evaluating the cost of other solutions, it will help general counsel make decisions on which solution to license (See my post of Feb. 9, 2012: an award for litigation hold software.).

Another sip of coffee wisdom. According to Bloomberg Bus.Week, Feb. 27, 2012 at 84, pacing and timing are key to the most effective ingestion of coffee: “The first coffee of the day should be the biggest, and drunk the fastest for a big bump. The rest of the day’s doses should be smaller and ingested more slowly.” Chuck the first venti, then tipple (See my post of March 3, 2011 #4: coffee and collaboration.)

Mapping the interconnected features of the brain. The Economist World in 2012 at 153, introduces readers to the Human Connectome Project. The Project has set itself the task of mapping neural features down to around a cubic millimeter of brain tissue, each of which contains hundreds of thousands of nerve cells. “In the cerebral cortex there are about 50 areas for which good maps already exist, but they cover only about a third of the cortex.” Over the next two decades, neurology will be able to contribute to how general counsel hire, evaluate, train and motivate legal staff (See my post of Feb. 28, 2012: Brodmann 10 area.).

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It is mildly exasperating and disappointing to hear the same examples time after time from the dais. Can’t speakers come up with something other than “Focus on strategic work, [pause as if pondering] such as bet-the-company litigation.” Can’t they offer something else? Or “Push your law firms to be innovative, [pause as if considering among choices] such as alternative fee arrangements.” Really, haven’t heard that one before! Or the chestnut of “Be sure the work is done as efficiently as possible, such as with delegation.” Take my breath away! Are people thinking when they wheel out “Share knowledge, such as with an intranet”?

Right, you say, each of these shop-worn examples makes brilliant sense to someone in the audience who has been hidden under a rock or whose name is van Winkle. Right, some consultants who write arrogant and snarky posts about over-used examples should realize that not everyone is immersed in management-speak.

All I urge is that speakers and writers reach beyond the reflexive instances and offer something else. If nothing else comes to mind, then the supposed advice stands emptier, an emperor with barely any clothes.

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A.C. Grayling, Ideas that Matter: the concepts that shape the 21st century (Basic Books 2010) presents the venerable British philosopher’s summaries of 130 major concepts. Most covered in 2-3 pages, approximately 30 of them have already appeared on this blog.

One that has not is accommodation theory, devised in the early 1970s by Howard Giles. “Accommodation theory states that when people talk to each other, they adjust their behavior and manner of speech to take account of (to accommodate themselves to) the topic, the circumstances, and the other people engaged with them in the conversation” (at 2).

Grayling observes that the theory sounds simple on its surface, but he claims it gives profound insights into how miscommunication and misinterpretation can happen, such as within the legal departments and with clients and outside counsel. The theory has to do with information transmission. Whether the topic belongs in Grayling’s list is a hard question. Whether it can guide general counsel is an easier question.

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UK matter management software. The UK’s largest friendly society LV= (aka the Liverpool & Victoria) has implemented Proclaim case management software from Eclipse Legal Systems for its inhouse legal and secretariat team to support internal clients. This item comes from Charles Christian’s Orange Rag, January 2012. Also, the legal services team at South Lanarkshire Council has implemented the Civica Legal system to improve case management, time recording and court bundling (See my post of Feb. 5, 2012: 11 matter management systems at LegalTechNY.).

CPA Global acquired by private equity firm. European private equity firm Cinven is to acquire the global IP management, offshore document review, LPO, and LSO (legal services outsourcing) business CPA Global for an undisclosed sum. The transaction is expected to be finalised over the next couple of months, according to Charles Christian’s Orange Rag, January 2012 (See my post of Nov. 1, 2011: Mitratech acquired by private equity firm.). Project Leadership Associates, which has a legal business consulting arm under partner Dan Safran, also sold itself to a private equity group in late 2011.

News of executives in the law department vendor space. Jeff Hodge has left doeLEGAL where he had served as Executive Director, Corporate for about a year. In late January, Wolters Kluwer promoted Richard Flynn to Group President and Chief Executive Officer of its Corporate Legal Services (CLS). CLS is a portfolio of businesses offering legal compliance and performance management solutions under brands that include CT Corporation, CT Lien Solutions, Corsearch, and TyMetrix.

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Two conclusions have clarified for me as I have tussled once again with a conceptual structure for what goes on in law departments. My previous forays have resulted in a farrago of ideas and terms swirling around concepts, toolboxes, processes, methods, and tools.

It now seems to me that a set of three almost always applies: a cognitive category (a management concept), a set of related actions (a management process), and aids to accomplish those actions (management tools). Perhaps no longer do I need my constructs of “concept toolboxes” or “methods.”

Secondly, digging deeper, a part of speech applies to each set of three, which I will illustrate with one set of three: cost control – a noun form – means the concept; controlling outside costs – a verbal, gerundive form – means the process; and budget – an adverb applying to the verb – means one of the tools. This is a loose and creative metaphor but it may have usefulness.

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Value of equity awards. I heard recently that a “binomial calculation” is more complex than Black-Scholes but more accurate (See my post of Jan. 17, 2006: Black-Scholes formula uses standard deviations; Jan. 24, 2006: software to calculate the formula; July 25, 2007: the binomial method; July 27, 2007: the lattice-binomial method of valuation; and Jan. 20, 2009: restricted stock.). That compensation expert told me that as a rough rule of thumb the value of an option is 1/3rd of the stock price when awarded. He also mentioned FAS 127 and FAS 123r that promulgate rules about these calculations.

ACC membership numbers from Docket circulation. The ACC Docket Statement of Ownership, dated Oct. 20, 2011 and published in December (at 94), says that the organization averaged during the previous 12 months 24,153 “mailed outside county paid subscriptions.” (I’m not sure if copies mailed within DC, presumably the “county” of ACC, adds to that number.) They also averaged 2,819 “paid subscriptions outside the mails”. Doesn’t this suggest that the membership of the Association of Corporate Counsel was just above 24,000 during that period?

Complexity increase over time in software license agreements. SmartMoney, Feb. 2012 at 59, cites research by NYU School of Law on the elaboration of software license agreements. From 2003 until 2010, the average number of words in those agreements grew from 1,615 to 2,235. That increase of 38.4 percent in 7 years bespeaks the increasing legal concerns of software publishers – and perhaps the general trend for contracts to metastasize.