RSS SyndicationA brief article from the website of an NBC affiliate in Washington State caught my attention this morning. It noted that a jury awarded three female prosecutors $1.5 million following a trial of their complaint that their boss, the Thurston County prosecutor, was running an “old-boys” network that discriminated against women on the basis of pay and case assignments. As bad as that sounds, such things are all too common and that wasn’t what caught my eye.
What struck me was that the court costs and legal fees to unsuccessfully defend the prosecutor’s office from this sex bias lawsuit was nearly $6 million! That’s right; the cost of defending the lawsuit was 4 TIMES the actual award to the plaintiffs.
The lesson is pretty clear. When it comes to litigation, even if you win YOU LOSE! If you are an officer in a company that is looking to an outside law firm for assistance, regardless of the quality of the legal services you are receiving (and paying for), it is too little too late. If you have to contact your attorney after the fact, you have lost before you’ve picked up the phone.
The reality of the world today is that everything a business does has legal implications and it can be a veritable minefield. Using a law firm is like calling for a medic after you’ve stepped on a mine. Having a legal department, even a part-time legal department such as The General Counsel provides, means having someone to guide you through the minefield. It means someone is flagging potential issues before they become issues, and taking care of them. It means you or your CFO are free to do what you do best – run your business – instead of spending your days playing legal backstop. It means company contracts are being reviewed before your business is on the hook for something you didn’t think about. It means processes are in place to ensure things operate smoothly and efficiently and within the law. It means your employee handbook is up-to-date and the Human Resources department has someone to look to for advice and strategy. W
hen litigation does arise (and it will) you have someone to bring a “big picture” point of view to the matter, to provide oversight and to review the law firm’s bills.
Having The General Counsel in your corner is a value proposition. After all, what is the value to your business of the lawsuit that never happened? In this Washington State case, it was $7.5 million.