team. But wouldn’t those in-house cuts result in higher outside counsel bills, wiping out the supposed savings?
Mellen reports that that hasn’t happened. In fact, he
says, the company has lowered its litigation spending since
2005 by 27 percent (excluding IP, which is handled by a
THE “TONE AT THE
TOP ALSO MATTERS
FOR OUTLOOK,” SAYS
GC DAVID LEITCH.
separate group). Virtually all of its law firms have adjusted
their fees to accommodate the company’s changed circumstances. Many volunteered to do so without having to be
asked, Mellen says. In some instances, to save money, trial
lawyers partner with other firms that handle discovery.
What makes this all the more remarkable is that Ford
has long had flat fee arrangements with its outside firms
that would be the envy of the Fortune 500, were the deals
more widely known. About 80 percent of its litigation case-
load—which constitutes 70 percent of its outside counsel
spending—is paid on a flat fee basis. That hasn’t changed
much over the past decade. When Ford doesn’t pay flat
fees, nearly 95 percent of the partners trying its cases work
for hourly rates of less than $300.
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B EST
LAW YERS
2010 EDITION
®
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