Chief Legal Officers Foresee Increases in Internal Hiring and Outside Counsel Usage

New York & Newtown Square, PA, June 20, 2007 – The 2007 Chief Legal Officer Survey, conducted annually by Altman Weil, Inc. and LexisNexis has just been released.  The survey reports plans for increased staffing in law departments as well as increased use of outside counsel.

Inside Staffing
Forty percent of Chief Legal Officers (CLOs) participating in the survey plan to extend their in-house capabilities by hiring additional lawyers in the next twelve months, up from 36% last year.  In addition, law departments report they have added an average 1.7 completely new positions in the last two to three years.  This number tripled from .57 new positions per department reported in the 2006 survey.

The most frequently added new position in law departments was an attorney with specific practice expertise.  When asked about greatest future staffing needs, a specialist attorney was again ranked number one.

“Law departments are trying to find areas of practice where they can add the most value to their corporation – and bringing in a specialist can do that, as long as the economics of internalizing the work justify it,” explained Altman Weil principal Daniel J. DiLucchio.

Outside Counsel
Within the next twelve months, 18% of law departments plan to increase their use of outside counsel, up from 14% last year.

The survey also examined satisfaction with outside counsel, reporting that 32% of CLOs have fired or are considering firing at least one of their outside law firms this year.  The reasons for their dissatisfaction were:  ‘mishandling a critical matter’ - named most often, followed by ‘poor quality legal work,’ ‘lack of responsiveness,’ and ‘cost management issues.’

When asked what steps outside counsel have taken to improve the working relationship with the law department, the top response was improved communication.  Reduced fees / improved billing practices / budgeting ranked second.  Other relationship building efforts named were complimentary training programs, enhanced responsiveness, and new technology initiatives.

Selecting New Counsel
When choosing from similarly qualified firms on a preferred provider list or when looking for representation requiring a new area of expertise, most CLOs first consult their personal network of contacts, including: law firm relationship partners, inside counsel at other organizations and their in-house staff. 

When looking for new counsel in the absence of a personal reference, CLOs turn first to online directories for information. Other options are: reviewing law firm websites, attending legal conferences, checking lawyer rating services and using search engines. 
 
“While personal networking will always be a key factor in outside counsel selection, the use of online resources is important to note,” commented John Lipsey, Vice President of Corporate Counsel Services for LexisNexis Martindale-Hubbell.  “In 2007, CLOs still rely heavily on vertical market directories that provide them deep and meaningful outside counsel profiles, quickly and efficiently.  Law firms with a strong online presence will be the beneficiaries.”

Compliance Remains Top Concern
When asked about their long-term concerns over the next three to five years, Chief Legal Officers identified compliance as number one, followed by staff development and retention, costs, and serving the corporate client.   Compliance has been the top concern for CLOs in each Chief Legal Officer Survey since 2003.

 “One of the biggest factors driving the increased need for legal services in corporations is Sarbanes-Oxley compliance, remarked DiLucchio.  “Compliance issues impact law department staffing and training as well as generating new potential liabilities.  It’s not surprising that this is and has been the top of mind concern for CLOs.”

The Survey
The Chief Legal Officer Survey is conducted and published by Altman Weil, Inc. in conjunction with LexisNexis.  Complete survey results, based on 264 responses received in May 2007, are available online at www.altmanweil.com/CLO2007. 

About Altman Weil
Founded in 1970, Altman Weil, Inc. (www.altmanweil.com) provides management consulting services to law firms, law departments, government legal offices, and legal vendors throughout North American, Latin America, the U.K. and Europe.  The firm is independently owned by its professional consultants who have backgrounds in law, industry, finance, marketing administration and government.  Altman Weil offers a broad range of consulting services, including strategy, management, governance, M&A, compensation, marketing, finance, organization and training.

Altman Weil Publications, Inc. (www.altmanweilpubs.com), a subsidiary of Altman Weil, Inc., has collected and published management information for law firms and corporate law departments for over thirty years.  The company conducts market research and publishes numerous surveys of the legal profession including the Law Department Compensation Benchmarking Survey, the Law Department Metrics Benchmarking Survey and the Survey of Law Firm Economics.  Altman Weil surveys are the industry standard and are often utilized in courtroom expert testimony.

About LexisNexis
LexisNexis® (www.lexisnexis.com) is a leading provider of information and services solutions, including its flagship Web-based Lexis® and Nexis® research services, to a wide range of professionals in the legal, risk management, corporate, government, law enforcement, accounting and academic markets. A member of Reed Elsevier Group [NYSE: ENL; NYSE: RUK] (www.reedelsevier.com), LexisNexis serves customers in 100 countries with 13,000 employees worldwide.

Martindale-Hubbell (www.martindale.com) provides client development solutions for the legal profession, partnering with its law firm customers to meet their practice development goals.  An integral part of Martindale-Hubbell services to the legal community is its Martindale-Hubbell Peer Review RatingsSM service, which evaluates lawyers and law firms in the U.S. and Canada based on peer review.  Martindale-Hubbell Peer Review Ratings attest to a lawyer’s legal ability and professional ethics, and reflect the confidential opinions of members of the Bar and Judiciary.  The Martindale-Hubbell database of more than 1 million lawyers and law firms, accessible at www.martindale.com and www.lawyers.com, is the number-one lawyer directory on the Internet (as measured by Nielsen//NetRatings).  The company provides lawyers, business executives and consumers with detailed information to help them identify, evaluate and select legal counsel.

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Contact Information

Daniel J. DiLucchio, Jr.
Altman Weil, Inc.
(610) 886-2012
djdilucchio@altmanweil.com

Download the complete survey results.
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