Delawyering the Corporation

Larry Ribstein —  11 December 2011

My paper from Wisconsin’s in-house counsel symposium (symposium discussed here, paper previewed here) is now available on SSRN. The paper is Delawyering the Corporation.  Here’s the abstract:

This article shows how in-house lawyers’ role has evolved to address the high cost of legal services and the traditional information asymmetry between lawyers and clients. The first stage of this evolution involved the expanding role of in-house counsel from intermediary between corporate executives and the corporation’s outside law firm to the corporation’s purchasing agent in a broader market for legal services. The second stage could see legal work distributed among employees with and without legal expertise throughout the corporation. The article also shows how evolving legal information technology could facilitate corporations’ full-fledged integration of legal information into business decisions. These developments have potential implications for the corporate and general markets for legal services and for legal education.

In short, don’t assume that the evolution of corporate law practice will stop with more legal work moving inside the corporation.  The same forces driving this move — technology and markets — may change the nature of the work.

Larry Ribstein

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Professor of Law, University of Illinois College of Law

One response to Delawyering the Corporation

  1. 

    We’ll see. Having been in-house counsel at a Fortune 500 company, Vice-Chair of the Association of Corporate Counsel’s Law Department Management Committee, and a consultant to corporate legal departments on how to achieve efficiency gains and lower outside counsel spending, I can say that there is tremendous resistance to the idea of the in-house lawyer as a strategic sourcing buyer of legal services. The vast majority of in-house counsel do not even have a basic understanding of alternative fee structures, and law firms report that the great majority of their work is still performed via the inefficient and highly expensive billable hour approach. I strongly suspect that we won’t see a major, lasting change in this environment until CEOs and CFOs see legal services providers emerge that mix process improvement, knowledge management, document automation, and geographic arbitrage to improve the quality of legal services while reducing the fees and developing greater predictability in terms of cost. Personally, I feel that this kind of provider needs to emerge using non-lawyer contract managers in the U.S., or lawyers in the U.S. time zone located in places like Costa Rica, Chile or Brazil.