litametrics article acc docket may 2013

14
30-SECOND SUMMARY Litametrics is the application of analytics to improve decision-making to deliver desired litigation outcomes. They can be used to rank cases and calculate success probabilities using formulas that include such factors as jurisdiction, judge, plaintiff counsel and claim type. Using Litametrics ensures that all of that intelligence and intellectual capital is focused on the right cases, the right evidence and the right jury. Litametrics can also help counsel move towards financial management goals by providing a foundation for value-based budgeting and fee models. Analytics for Selecting Your Dream Team By Thomas L. Sager, James L. Michalowicz and Gardner G. Courson

Upload: scott-woodworth

Post on 02-Jul-2015

722 views

Category:

Business


2 download

DESCRIPTION

Great article from my good friends, Jim Michalowicz and Gardner Courson, on the application of Analytics to improve decision-making to deliver desired litigation outcomes.

TRANSCRIPT

Page 1: Litametrics Article ACC Docket May 2013

30-SeCoNd SuMMAry litametrics is the application of analytics to improve decision-making to deliver desired litigation outcomes. they can be used to rank cases and calculate success probabilities using formulas that include such factors as jurisdiction, judge, plaintiff counsel and claim type. using litametrics ensures that all of that intelligence and intellectual capital is focused on the right cases, the right evidence and the right jury. litametrics can also help counsel move towards financial management goals by providing a foundation for value-based budgeting and fee models.

Analytics for Selecting Your

Dream TeamBy Thomas L. Sager, James L. Michalowicz and gardner g. Courson

Page 2: Litametrics Article ACC Docket May 2013

S p o r t steams, political poll-

s ters , major cor porat ionsand research institutions have turned

to sophisticated analysis of so-called“Big Data.” Why? Patterns exist in large

data repositories in many areas of commerceand science that can assist users in making

better decisions. ¶ Understanding the trendsand consequences of data associated with legalspend can empower litigation counsel to makebetter and more informed decisions on staffingof a case, budgeting and fee management,

valuation of cases, likely outcomes and howto develop strategy to effectuate winning

litigation results. Introducing the“ M o n e y b a l l ” e q u i v a l e n t t o

litigation management —“Litametrics.™”

Acc docKEt MAy 2013 69

Page 3: Litametrics Article ACC Docket May 2013

Litametrics is the application of analytics to improve decision-making in any or all of the following areas: selec-tion of litigation counsel (assembling a competitive team), measurement of productivity and performance (in-game activity, total team efficiency), manage-ment of spending (budget, salary cap)

and developing strategies to deliver de-sired outcomes (predicting outcomes).

Think of the general counsel or chief litigation counsel who is evaluating responses to an RFP from law firms that are hoping to handle the company’s new-est large mass tort case. While reviewing the professionally prepared documents,

the chief litigation counsel starts making notes: AmLaw 20 firm, good record at trials, offers 10-percent discount off hourly rates, trial team graduated from top-tier law schools, some of the com-pany’s lawyers worked at the firm, etc.

Now, let’s shift to another scene. An NFL general manager or scout is pre-paring for the upcoming college foot-ball draft. The general manager needs to identify talent that will shore up the team’s defensive line. Looking at the scouting reports, the GM highlights players who competed in elite confer-ences and performed on teams that went on to win several bowl games and ranked high on the ESPN final season rankings. Physical factors have to be considered, such as body size, speed, agility and strength. Interviews with the college coaches may give a better sense about whether the player would fit into the culture and team environ-ment. If we draft this player, how much will it cost to sign him?

“Outside trial counsel often consider their legal services to be more of an art, and this leads many of them to resist focus on efficiency. Today’s best companies, however, reward all team members in the organization based on contribution levels, and efficiency in execution is a key variable in creating value for the enterprise.” – Silvio J. DeCarli, associate general counsel

and chief litigation counsel, DuPont

Be it on the football field or litiga-tion battlefield, the traditional process for the evaluation of talent and projec-tion of performance uses much more art than science. When assembling a football team or litigation team, the desired result is to have a winning re-cord, but that cannot necessarily come at any cost. NFL teams are bound to a set yearly salary cap, and throughout the season, each team must be at or under said cap. For law departments, the analogy is a litigation budget. Going over the cap or budget comes with severe penalties; these are clearly

Thomas L. Sager has been senior vice president and general counsel of

DuPont Legal since 2008.

James L. Michalowicz is president of Michalowicz Consulting LLC.

[email protected]; www.michalowivzllc.com

Gardner G. Courson is a partner in the Litigation & Dispute Resolution practice

group of the Taylor English Duma law firm. He is the former deputy general counsel

for Litigation of Tyco International, and the former VP and general counsel of Tyco

Fire & Security. [email protected]

Analytics tools and resources

sAbErMEtrics is the specialized analysis of baseball through objective evidence, especially baseball statistics that measure in-game activity.

MoNEyBAll: THE ArT of WINNING AN UNfAIr GAME is a book about the oakland Athletics baseball team and its gM billy beane. its focus is the team’s analytical, evidence-based, sabermetric approach to assembling a competitive baseball team.

footbAll outsidErs is a website founded by Aaron schatz. the site aims to bring objective analysis to football that matches the revolution in baseball writing and analysis over the past 20 years. “we have new methods for analyzing skill players, offensive and defensive lines, special teams and total team efficiency.”

fivEtHirtyEigHt is a polling aggregation website with a blog created by nate silver. during the 2008 and 2012 us Presidential elections, the site compiled polling data through a unique methodology derived from silver’s experience in baseball sabermetrics to “balance out the polls with comparative demographic data” and “weighting each poll based on the pollster’s historical track record, sample size and recentness of the poll.” the result was amazing accuracy in predicting presidential election outcomes.

big dAtA are high-volume, high-velocity and/or high-variety information assets that require new forms of processing to enable enhanced decision making, insight discovery and process optimization as defined by gartner, inc.

70 ASSOCIATION OF CORPORATE COUNSEL

LITAMETRICS: ANALyTICS FOR SELECTINg yOUR dREAM TEAM

Page 4: Litametrics Article ACC Docket May 2013

defined in the NFL and are more subjective in the corporate world. In either case, there is pressure to make smart spending decisions.

The use of analytics is not completely foreign to litigation management. Those who have dipped their toes and fingers in ediscovery know a bit about applying analytics to perform searches for documents, or ESI to determine evidentiary value. Analytics can help identify themes, high-impact docu-ments and the chronology of events in a more systematic way. Not only can analytics improve both the quality and cycle time in making document review decisions, but they can also alert the litigation team to issues that may impact case strategy. The scary, “Oh no, the computers are replacing the lawyers” changes to, “Big data is helping lawyers make more informed decisions; smarter decisions lead to better results.”

Litametrics does have a place in litigation management, and there is al-ready some evidence of success stories. It is important for in-house counsel to know how to:■■ assemble a litigation team;■■ offer sound financial management

by becoming a smart spender — paying for performance;

■■ predict outcomes and develop strategy to achieve those outcomes; and

■■ acquire talent to fill new positions in the front office.

Know your turf firstBefore assembling a team of players to take the field, Litametrics can be applied to better understand the type of team that is needed. Most chief litigation counsel have a sense of what makes up their litigation docket or portfolio of cases. Matters are

categorized by areas of law, type of litigation and geography. There may be some grouping of cases based on size of case, tier levels and signifi-cance to the company’s public image.

Litametrics can be used to drill down further to rank cases by expo-sure level, complexity and “value” of case. Success probabilities can be calculated using formulas that include such factors as jurisdiction, judge, plaintiff counsel and claim type. For repetitive areas, such as employment and product liability litigation, data history is available, which can be used to profile matters and assign a price or value (i.e., how much it will or should be to litigate a given matter).

When DuPont Legal embarked on creating a new model for managing litigation, one of the first steps was to perform a needs assessment. The total

– MERITAS LAWYER –FRED SELLER

Ottawa, Ontario, Canada

170 full-service, independent law firms

7,000 experienced lawyers

Local representation in 70 countries

Meritas understands the inherent challenges of choosing the right legal

counsel, especially when searching outside of your jurisdiction. That’s why

our law firms undergo rigorous vetting and are required to maintain quality

standards for membership. Whether you need a firm next door or halfway

around the world, Meritas offers exceptional service, local insights, local

rates and the assurance of a wise decision.

THE RIGHT CHOICEFOR THE RIGHT LAWYER.

w w w . m e r i t a s . o r g

CHOOSE WISELY. WE HAVE.CHOOSE WISELY. WE HAVE.

MER ACC HLF PG AD OCT12issue:Layout 1 8/20/12 9:29 PM Page 1

Page 5: Litametrics Article ACC Docket May 2013

litigation portfolio was divided into four groups based on levels of impact.■■ “Brain surgery,”■■ Specialty litigation,■■ Product liability/personal injury,

and■■ Commodities.

The conclusion was that the greater percentage of the litigation portfolio resided in levels three and four, and for these cases, simple, efficient legal ser-vices were required. High-impact cases required higher-impact firms, and firms without the high price tag could handle low-impact cases effectively.

In an analysis performed in 2012 using Counsel Management Group’s AFADATA proprietary system, DuPont was offered insight into the costs associated with engaging various types of firms. A further deep dive into the analysis would show whether the level of spend based on impact level of the firm was in line with the “value” or “impact level” of the cases where outside counsel was assigned.

In 2000, the Patriots drafted a rela-tively unknown quarterback named Tom Brady in the sixth round. He was the 199th player selected overall. The Patriots’ roster in 2012 featured 18 players who weren’t drafted by the NFL when they left college. While all teams have access to a wealth of data on these players, the Patriots have the ability to look at that data in a unique way, and fit it into their overall system. They understand the processes that drive success for their organization, and have been able to quantify and evaluate the available resources that will most positively impact those processes.1

A common mistake made by law departments is following the “always assign the best lawyers to my cases” selection method. This often translates into hiring the most expensive lawyers or law firm for any given matter. Doing so makes sense to the degree that inside litigation counsel want the best protec-tion in defending complex cases on

their particular docket. The fear is that any case could go bad and expose both the inside counsel and the company. Unfortunately, there is another conse-quence from this type of behavior — spending more than what the value of the portfolio warrants; in other words, treating every case as a “bet the com-pany” case. The analogy can be made to professional football teams that overspend on high-priced, big-name free agent players. Spending money for a team of all high-priced talent does not necessarily translate to wins on the playing field or in the courtroom.

Financial management: Controlling the spend Starting in 1994, the National Football League set up a salary-cap system, whereby each team is limited to how much money can be spent on players’ salaries in a given year. The first salary cap was set at $34.6 million per team. In 2012, the salary cap was $120.6 mil-lion. There are provisions for building into the cap number player perfor-mance bonuses that are negotiated between the player and team. These incentive bonuses are treated as “likely to be earned” and thus calculated into the team’s salary cap figure. The NFL’s league office approves all contracts so, presumably, no individual team should go over the cap. In those instances that a team does go over the cap, the forfei-ture of draft picks or severe financial penalties are levied.

The comparison of the NFL sal-ary cap system to a law department’s budget is not a perfect match. One of the reasons for the NFL salary cap is to provide an even playing field for teams to compete in the league. The teams with the greatest resources to spend cannot buy a championship. Having said this, once again, let’s be reminded that spending the most does not guarantee winning results. But beyond this, there is an essential element that resonates with general counsel: Spend the company’s money wisely.

The chart on page 74 provides insight into how law departments are exerting their energies to control costs and assure that money is being spent wisely.

Although it is not completely clear from looking at this chart, there is enough information in the market from similar surveys that show “price reductions” typically mean hourly rate or volume discounts. Why is this important?

In an article titled “Points of Law: Unbundling Corporate Legal Services to Unlock Value” (Harvard Business Review, July/August 2012), the authors warn, “With excess capacity, technology and new capacity all shift-ing power to corporations, it is not surprising that many of them have renegotiated terms with their firms. In most cases, the firms’ concessions have come in the form of discounted rates, which by their nature are lim-ited and unsustainable.”

In his book “Declining Prospects,” Michael Trotter, partner at the Atlanta-based firm Taylor English, dives into the detail of law-firm economics and the Profits Per Partner model. Trotter specifies four ways that a firm can increase its Profits Per Partner (PPP):1. Charge clients more by increasing

hourly rates or increasing payments through alternative fee arrangements.

Moving to a value-based budgeting and fee model requires some trust and transparency between inside and outside counsel. Litametrics can offer a foundation where both parties are working from the same data models and move closer to alignment on the financial management goals.

72 ASSOCIATION OF CORPORATE COUNSEL

LITAMETRICS: ANALyTICS FOR SELECTINg yOUR dREAM TEAM

Page 6: Litametrics Article ACC Docket May 2013

Hold all the .

You’re ahead of the game when the cards are in your favour. Our litigators are the aces in your pack. That’s why WeirFoulds is a “litigation firm through and through with a marvelous track record”, Chambers Global.

416.365.1110www.weirfoulds.com

Protect your future. Gain a competitive advantage. WeirFoulds llp.

Page 7: Litametrics Article ACC Docket May 2013

2. Do more work by working more hours or using more lawyers.

3. Acquire new clients.4. Reduce overhead.

The conflict arises when PPP of the law firm is under threat through such efforts by inside counsel to negotiate discounted hourly rates. Logically, to maintain a strong PPP, the firm increases the number of billable hours. Given that outside counsel are typically the originator and formulator of the litigation budget, and consideration is weighed heavily on the PPP law firm economic model, why are we not surprised to see survey results such as those listed on page 76 from Fulbright & Jaworski’s 8th Annual Litigation Trends Survey?

Litametrics provides a different Profits Per Partner (PPP) model

“The billable hour incentivizes inefficiency because lawyers get paid based on how much time they spend on a matter.” – Joshua Frank, general counsel & secretary,

DHL Americas2

What if PPP were redefined as Pro-ductivity Per Professional?

What would be the core questions asked of inside counsel in moving toward the creation of this new metric?■■ What are we buying? (Not hours!)■■ What should the pieces cost?■■ What factors determine value?

Staffing/Seniority

x

x

Efficiency/Hours

Hourly Rates/Fees

Making use of The Counsel Man-agement Group’s proprietary litigation budget templates, DuPont Legal has introduced “productivity” and “value” into financial and budget discussions with outside counsel. The four key

principles DuPont Legal adopted in implementing value-based billing are:• The company wants to pay for

results, not time;• The focus is on how well services

are provided, not how long it takes to provide them;

• The key expectations of both DuPont Legal and the outside firm are clearly stated and addressed early in the negotiation process; and

• The staffing and work processes are identified and adapted to working in a value-based billing model.

Moving to a value-based budget-ing and fee model requires some trust and transparency between inside and outside counsel. Litametrics can offer a foundation where both parties are working from the same data models and move closer to alignment on the finan-cial management goals. When looking at the chart on page 76, it would be fair to say that most inside counsel/outside counsel are working between financial management levels three and six.

The ultra-model, Value Based Fees (VBF) with TLC, designates those ar-rangements where the fee is based on value provided in terms of service, but an incentive bonus is also offered to the firm for delivering a Total Litigation Cost result (Defense + Resolution

Costs) that is defined as a “win.” This type of arrangement is the total “pay for performance” model in that it rewards firms for efficiency and effectiveness. The VBF with TLC brings value beyond the fixed fees-only arrangements, which are only able to offer some predictabil-ity on outside counsel spending.

It is important to keep in mind that, just as the NFL captures incen-tive bonuses in calculating the salary cap, the law department needs to ac-count for likely bonus payouts in the annual budget.

As part of its Value Challenge program, in the fall of 2012, the Association of Corporate Counsel (ACC) launched the “Value Based Fee and Budget Project” and offered this solution as part of a benchmarking pilot program to large member com-panies seeking to rise on the financial progression chart. The beauty of this effort is that participants receive value-based productivity tools and support services, but also benchmarking data from those who share the goals of value-based financial management. DuPont Legal is serving as the anchor member for this innovative project.

Predicting outcomes and developing strategy to achieve those outcomesBrian Burke, former Navy Pilot and Sabermetrics devotee, developed

how legal departments are controlling costs

Source: Altman weil, Inc.

74 ASSOCIATION OF CORPORATE COUNSEL

LITAMETRICS: ANALyTICS FOR SELECTINg yOUR dREAM TEAM

Page 8: Litametrics Article ACC Docket May 2013

a statistical model named “Win Probability.” Burke’s model was built collecting data from over 3,000 NFL games. Win Probability produces odds of a team winning a game based on decisions made by a team to on-field situations. According to Burke, most teams suffer from a “subop-timum equilibrium, with no teams playing the optimum way.” The analyt-ics showed that teams didn’t pass the ball enough and ran the ball too much, and they were far too passive on fourth downs, settling too often for field goals and punts.3

Nate Silver won great acclaim after successfully predicting the results for each state in the 2012 US Presidential Election. Silver demonstrated on his 538 Blog how an analytics model based on multiple third-party poll-ing data led to a 91-percent certainty that President Barack Obama would be reelected to a second term. Some

naysayers were dismissive of Silver and had a greater confidence in their own data or perception of how the election results would turn out.

In a study published by Goodman-Delahunty, J., et al., titled “Insightful or Wishful: Lawyers’ Ability to Predict Case Outcomes” (16 Psychology, Public Policy, and Law 133 2010), the researchers interviewed almost 500 lawyers, asking them to predict the outcome of some of their pending cases, and then compared their predic-tions to the actual results. Forty-four percent of the lawyers interviewed experienced worse outcomes than they predicted. Experienced attorneys were no more accurate than their novice counterparts. Indeed, the study’s authors noted, “Many of the most over-confident lawyers will be the senior partners who may not typically obtain third-party review or feedback in the course of their practice.”

What can we conclude from the Goodman-Delahunty study? Attorneys tend to be overconfident about their chances of success early in a lawsuit, and that overconfidence can seriously skew their evaluation of a case. Furthermore, take the wrong case, and the client’s resources may be squandered; or, take the right case but build an argument that won’t fly with a jury. The result is the same: less-than-optimal settlements, outright losing, and a dissatisfied and perhaps underserved client.

The ability to realistically evaluate a case, then efficiently litigate it, or try the case to a finder of fact, has given rise to a new breed of products and tools. What they have in common is that they significantly reduce the guesswork in as-sessment, and free attorneys to do what they do best — advocate, strategize, litigate and win. More important, using this adaptation of Litametrics ensures that all that intelligence and intellectual

The secreT To e-discovery is

knowingwhere To look.

Nashville • knoxville • Memphis • washington, d.c.

Exponential growth of electronic information can overwhelm your ability to efficiently manage discovery. That’s where we can help. our data management experience and close relationships with leading e-discovery providers help clients develop defensible strategies using targeted tools that save time and money.

bassberry.com

13-BB-157 ACC Docket HalfPg e-Discovery Ad M2 mm.indd 1 3/20/13 8:34 AM

Page 9: Litametrics Article ACC Docket May 2013

capital is focused on the right cases, the right evidence and the right jury.

Gardner Courson, a litigation partner with the Atlanta-based firm Taylor English, and the managing director of Precision Litigation LLC, a litigation consulting firm, has been instrumental in the development of an analytics-based tool called PreView Profile, which is based on a data-driv-en litigation assessment. For Courson, the magic potion is “turning lawyer intuition into data.”

PreView Profile builds on the concepts of expert business pro-cesses and technology. Applying the trial counsel’s selection of key search terms, the process statistically samples a large set of the pertinent documents to cull out those documents that are likely to be most critical in defend-ing or prosecuting the case. Up to 20 of those documents or summary exhibits are combined with the mock video testimony of up to five key wit-nesses per side. Along with 30-minute “opening/closing” lawyer arguments for each side, the edited and com-pressed review of the evidence is then presented remotely to jury-eligible citizens of the appropriate venire for live mock deliberations.

The heart of the success-ful PreView Profile model is its decision-tree analysis (see page

78). Seasoned litigation consultants facilitate discussion among the outside and inside counsel to identify the determinative legal and factual issues and place each of the issues into an “if/then” hierarchy. The trial team assigns a probability of winning and losing each issue on the decision tree. Combining all of the probabili-ties with the range of possible jury verdicts enables the attorneys and the client to determine a value range for the case. In short, the business intel-ligence process uses real evidence, experienced attorneys and skilled facilitators to analyze the dynamics, risks, costs and potential outcome of

a lawsuit within a few months after notice of the suit is received.

With a business imperative in many companies to keep cases from going through a lengthy and expensive litiga-tion process, the early application of intelligent and cost-effective informa-tion gathering can lead to reduced costs, faster closure and increased client satisfaction.

Quantifying value and increas-ing the probabilities of winning has been instrumental in the rollout of DuPont’s Global Recoveries Initiative. Started in 2004, the key objectives of the Recoveries Initiative are to assert the legal rights of DuPont through the intervention of its legal team, to recoup cash or other quantifiable rights owed to DuPont, to educate and inform DuPont businesses about potential recoveries and to develop resources to facilitate future recoveries.

The Recoveries Initiative is not a litigation program, although, in some cases, recoveries do result from litigation. Business analytics play an important role in the success of this program, but given that the program is not litigation focused, the proper identifying term may be better coined Legametrics — application of analyt-ics to legal management — compared to Litametrics.

Fulbright & Jaworski’s 8th Annual Litigation Trends Survey

Financial Management Progression Chart

76 ASSOCIATION OF CORPORATE COUNSEL

LITAMETRICS: ANALyTICS FOR SELECTINg yOUR dREAM TEAM

Page 10: Litametrics Article ACC Docket May 2013
Page 11: Litametrics Article ACC Docket May 2013

results from duPont’s global recoveries initiativeThe recoveries program relies heavily on the participation of a multidisci-plinary team with the president of the DuPont business unit serving as the quarterback. Members of the team include the business unit CFO, the legal team’s commercial lawyers, international counsel serving as regional legal recoveries leads, litiga-tion counsel, outside counsel as sub-ject matter experts, and representa-tives from Research & Development and Sourcing. The team holds two types of meetings: strategic review and execution review. Analytics are used to identify opportunities with the best environment, means and chances for success (i.e., ability to achieve desired outcomes).

Data analytics have also been crucial in giving the recoveries program legs and countering the cultural-change challenges. The key challenge is to move from a conservative, risk-adverse culture to one of a client-focused, bottom-line-driven organization. This is not to say there is no risk associ-ated with asserting these rights, but that risk is factored into the analysis. Ultimately, by positioning the lawyers and the business people for success, the ensuing results, supported by data, reward the participants for taking a more proactive approach.

New positions in the front officeIn the Academy Award nominee movie “Moneyball,” we are introduced to Billy Beane (Brad Pitt), the general manager of the Oakland A’s baseball team. Forced to reinvent his team on a tight budget, Beane has to outsmart the richer clubs. The onetime ball-player, raised by the traditional rules of the game, teams up with Ivy League grad Peter Brand, a Sabermetrics geek. In an unlikely partnership, Beane begins relying on Brand’s ana-lytics to recruit bargain players that the scouts call flawed, but all of whom

have an ability to get on base, score runs and win games. It’s more than baseball; it’s a revolution — one that challenges old-school traditions and puts Beane in the crosshairs of those who say he’s tearing out the heart and soul of the game.

In 1992, DuPont Chairman Edgar Woolard, Jr., challenged his staff to slash more than $1 billion in operat-ing costs. Determined to do its part, DuPont Legal launched a campaign to achieve high-quality legal services at reduced cost. A legal department team, composed of corporate counsel and senior management, and assisted by outside consultants, conducted an analysis of escalating expenses. The team concluded that litigation would be the initial focus of the Legal Model and established objectives to reduce cost and increase productivity. At its core, the Legal Model is an integrated approach for managing change within the law department, and for continu-ously improving how legal services are provided to DuPont businesses in terms of quality, cost and efficiency.

The DuPont Legal Model is ever evolving, and more and more, Litametrics is taking hold. In 2013, DuPont Legal established a posi-tion titled “chief productivity officer.” Concerns about “budget creep” war-ranted a new approach to engaging

outside counsel on strategic budget management. There was a view that too much deference was being given to DuPont Legal’s outside provid-ers regarding proposed staffing and activities on litigated matters. The chief productivity officer, armed with dynamic analytics, has new insight on outside counsel performance, similar to Billy Beane’s in baseball — firms that know how to get on base (efficient delivery of work product), score runs (successful motions) and win games (case results). The chief productivity officer has an important seat at the table when inside litigation counsel engage the outside firm in those often-difficult discussions about staffing, hours required, budget, and efforts needed relative to the value of the case. This is part of change management, and the chief productivity officer helps guide inside counsel in making hard financial management decisions.

Based on corporate clients’ de-mand for demonstrable cost savings and value-driven fee arrangements, law firms are also expanding their infrastructure teams to include analytics-trained personnel. For example, one AmLaw 100 firm is staffed with an attorney heading the project management department. This “business analyst position” is focused on providing quality data

Preview ProfileTM

78 ASSOCIATION OF CORPORATE COUNSEL

LITAMETRICS: ANALyTICS FOR SELECTINg yOUR dREAM TEAM

Page 12: Litametrics Article ACC Docket May 2013
Page 13: Litametrics Article ACC Docket May 2013

to the firm’s partners so that they can make more informed economic decisions and manage their matters on a real-time basis. As a nod back to the “Moneyball” analogy, the role of this position is to teach partners how to “play the game” so that they better understand the economics behind practicing law. Initially, partners were skeptical about incorporat-ing this quantitative approach into their practice. The result, how-ever, has been an increase in matter

performance from both a financial and qualitative work perspective.

Another AmLaw 100 firm recently hired a director of business manage-ment and analysis, supporting the information governance and ediscov-ery practice group. The partner who leads this practice relies heavily on the analytics expert to not only help prepare pricing for proposals but also monitor activity and financial impact throughout an engagement. Hitting productivity rates is critical

to meeting not only the client’s bud-get requirements but also the firm’s bottom line.

Toby Brown is the director of Strategic Pricing and Analytics with the law firm Akin Gump. In his article, “The Challenges Negotiating Legal Fees: An Alternative Fee Case Study,” Brown refers to the legal fees negotiation between corporate client and law firm as the “rates dance.” Brown emphasizes that the “rates dance” is a futile exercise that leads to the law firm struggling to make profits under reduced rates and the client not achieving any cost savings. However, he does offer hope: “This frustration is pushing many clients to re-examine the dance and shift the conversation to the fee level. The days of just getting a bigger rate discount may be ending. Clients, under inter-nal pressures, are learning to redirect the dance into more healthy, proper fee negotiations.”

Litametrics: A common threadThere have been many articles and seminars that raise the topic of obtain-ing or offering value in legal services. There are often chants from the offices of the general counsel that sound like pleas of “Desperately Seeking Value.” Litametrics can help in quantifying value and can offer litigation counsel a common thread to develop value propositions that reward both the pro-vider and receiver of value-based legal services. In this way, the science can help us with recognizing the art and improving the practice of law. ACC

notEs1 Adrian Alleyne, decisionPath Consulting

website, 2012.2 “Speaking different Languages:

Alternative Fee Arrangements for Law Firms and Legal departments.” April 2012. ALM Legal Intelligence.

3 “Blessed Are the geeks …,” Albert Chen, Sports Illustrated, december 10, 2012.

duPont recoveries Part one

duPont recoveries Part Two

80 ASSOCIATION OF CORPORATE COUNSEL

HAvE A coMMEnt on tHis ArticlE? vISIT ACC’S BLOg AT WWW.InhOuSEACCESS.COM/ACC-DOCkEt.

Page 14: Litametrics Article ACC Docket May 2013