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“Legal metrics that matter with defense counsel”

An article with this title appears in Claims Mgt., March 2012 at 14. Metrics fan that I am, I read with interest about the six. Not much to say on the first two, except to agree that time to close and average defense cost per claim make sense to track. “Lawyers per indemnity dollar” comes from dividing the fees paid outside counsel by the number of lawyers who recorded time on the matter. All law departments could look at this measure since stray timekeepers don’t add commensurate value.

The fourth metric, “Predictability of verdicts and settlements” from the first forecast to the final result sounds plausible. It might break down, however, because of the variability of when the first forecast is made and the inclination to high-ball it.

“Alternative fees compared to hourly billing” is partly about the balance of hourly and non-hourly fees and partly about the overall costs that result from each variation. This metric adds value if your department has enough matters of each kind and assigns them randomly. Few departments meet the former test; none the latter.

“Rates and results by firm size” might shed some light on how best to manage but law departments tend to use firms roughly in step with matter importance or complexity, and therefore rates climb also.

These metrics fit better with a claims docket full of relatively simple and uniform disputes than with a litigation docket that could have widely-varying types of law suits, amounts at issue, and legal bases.