Altman Weil Survey Says Corporate Legal Budgets Cut As Most CLOs Negotiate for Lower Law Firm Bills
A new Altman Weil survey of corporate legal spending isn’t happy news for law firms.
For the first time in three years, more in-house legal departments are reducing, rather than increasing, their spending on law firm services, the Phildelphia Business Journal and Reuters report.
Almost 40 percent of those responding to the consultant’s 2012 survey of chief legal officers said they cut their budget for outside counsel between 2011 and 2012. Only 34 percent increased their outside counsel budget.
Meanwhile, seeking to control costs, 71 percent of respondents negotiated with their law firms for lower legal bills over the previous 12 months and 41 percent shifted legal work to law firms that charged lower fees. Keeping more legal work in-house was a tactic employed by 47 percent of respondents, and 36 percent cut the overall amount of work being sent to outside counsel.
“Chief legal officers are not waiting for law firms to change their business modelsb ut are taking the ball and running with it to score savings on their own.” Altman Weil principal Daniel DiLucchio said.
Knowledge of the client’s business was a key factor in deciding which law firm to use, the survey found.
Related coverage:
National Law Journal: “A law firm is not a basket of fruit”
