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The Mad Clientist

Corporate Counsel Shift $5.8 Billion In-House

By June 20, 2013April 16th, 2020No Comments

Unlike Ben Bernanke, corporate legal departments are taking dollars out of the system. Corporate counsel shifted $5.8 billion from their outside counsel budget to internal spending—the equivalent of keeping 2 Latham & Watkins’ in-house. The shift drives a paltry projected 2013 growth of 1.8% in outside counsel spending instead of a 5.1% compound growth rate had corporate counsel spent the money on outside law firms.[1]

Corporate counsel’s top goal is to wring more value from their scarce legal dollars. Shifting money in-house from law firms is one value generating opportunity created by a combination of need and the ability to bring on higher quality lawyers than in the past.   

Corporate counsel are bringing the following practice areas in-house: 

  • IP prosecution
  • Licensing
  • Complex commercial contracts
  • Routine litigation
  • Regulatory and compliance

The law firms engaged in legal process change and workflow enjoy some degree of immunity, as do those who provide client-specific, tailored legal updates to clients—especially the tailored web-based updates. All others have to duke it out with competitors and their clients’ newly added internal resources.

For those not currently engaged with clients in redefining value outside of rates, we recommend a serious discussion with your clients about their goals in bringing work in-house. What are they trying to accomplish? How can you help? This shift brings a rare opportunity to engage clients in dialogue about value, goals and the changes your clients are making.


[1] Based on BTI research conducted from March 2012 to September 2012. BTI conducted more than 300 independent, individual interviews with CLOs and General Counsel at Fortune 1000 companies and large organizations. 

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