FOR IMMEDIATE RELEASE: October 13, 2011
In today’s unpredictable economic climate, many organizations struggle with the reality of reducing costs and consolidating third-party expenses while maintaining the expertise necessary to drive the business forward. Regardless of the specific challenges, one thing is for sure: the need for reliable, sound legal counsel is universal. But how does one responsibly fill that need and keep costs manageable? It’s a common question that requires one to rethink the role of in-house counsel.
The decision to engage outside legal counsel is not always an easy one. Many small and mid-size businesses as well as portfolio companies are increasingly finding themselves in a Catch-22. Companies either avoid outside counsel because they are fearful of legal fees that were not previously budgeted or are inundated with legal fees because outside counsel is sought at every turn.
The first instinct may be to hire in-house counsel. But even if the organization can afford it, in-house attorneys will still seek outside counsel to provide subject-matter expertise, market insight and bandwidth support. A viable alternative is to transition the role of in-house counsel from internal to external. It may seem counterintuitive to utilize outside counsel to fulfill this role, but outsourcing day-to-day legal needs can be the most cost-effective and budget-conscious way to ensure that the organization always receives the necessary expertise to remain competitive. For some companies, it means outsourcing the entire general counsel function, for others the best solution means having in-house counsel utilize the Klehr Harrison team as their outsourced legal department.
For Tom Garland, CEO of PaperWorks, the portfolio company’s rapid growth was the catalyst for outsourcing the entire general counsel role to Klehr Harrison. The full-service packaging company, owned by a private equity firm, has grown from two locations to 19, and its annual revenues increased 500 percent since its formation in September 2008. “Growing from annual revenues of $100 million to $600 million, it was challenging to accurately forecast how much legal counsel would be required at each step of our growth,” admitted Garland. “My needs were broad – everything from real estate law and litigation, to employee agreements and supplier purchase agreements. And to staff in-house counsel with expertise in each of these areas was cost-prohibitive.”
For Klehr Harrison, assuming the role of general counsel translates to a dedicated team of experienced senior-level attorneys working to deliver high-quality legal services on a cost-effective, predictable, retainer basis. For PaperWorks, for the budgeted cost of a single full time equivalent employee, Paperwork employs the same core group of nine attorneys who have represented the paper company since its formation to also carry out the general counsel function means a consistent, seamless approach to all legal needs.
Garland continued, “Beyond consistency, as our outside GC, Klehr has the on-demand bandwidth in every area of law so that I have immediate access to the senior-level expertise required to address my specific need and the frequency of that access can ebb and flow. It’s like a faucet; if the needs slow down, I shut it off… and that off-on flexibility is mission critical to a company that is growing at the rapid rate that we are.”
Whether the matter involves the review of a basic service contract, employment advice, environmental compliance or a choice-of-entity question, Klehr Harrison acts as PaperWorks’ legal gatekeeper or as what Garland refers to as “deep generalists.”
He adds, “The team brings the resources to bear at all times; I never experience the bottleneck effect that is typical of an in-house general counsel that can get overwhelmed with the diverse range of legal work and fail to complete it in a timely manner. The response rates of Klehr’s GC team are impeccable, and that is invaluable to PaperWorks because it’s not enough to simply operate at the speed of business; that’s why Klehr operates at the speed of our business … and we’re running at full throttle.”
The monthly fixed fee, which Garland adds “is really fair and appropriate,” is determined based on an initial analysis of daily legal needs. It is a business model that works equally well for outsourcing the entire general counsel function or for having in-house counsel engage the Klehr Harrison team as their outsourced legal department. Klehr’s corporate counsel services typically cover the following categories of legal needs:
For more information on Klehr Harrison’s outside corporate counsel services, please contact:
Michael K. Coran at 215.569.2497 or email@example.com
Bradley A. Krouse at 215.569.1598 or firstname.lastname@example.org
William Matthews at 215.569.4281 or email@example.com