Mobile Content Providers Settle Unauthorized Billing Class Action

Thu, 02 Sep 2010 17:00:00 GMT

While the FCC has taken an interest in mobile marketing by carriers -- most notably with investigations of carrier early termination fees and proceedings examining wireless consumer "bill shock" -- it also is helpful to remember that the mobile content providers are subject to enforcement for deceptive marketing practices. Our colleagues at the Ad Law Access blog covered a recent settlement of a class action lawsuit by several mobile marketers. They remind marketers to clearly and conspicuously disclose costs so that consumers know what they are obligated to pay. Mobile service providers should ensure that their billing and collection agreements impose such an obligation on the content provider and that the carrier properly polices compliance.

Read the Ad Law Access story here.

Late-Filed Forms Update: Airband Seeks Review of FCC Denial

Wed, 01 Sep 2010 13:15:32 GMT

Last week, we posted an entry about the tough stance the FCC's Wireline Competition Bureau is taking on late-filed Universal Service Forms submitted by contributors. One of the parties whose USF appeal was denied, Airband Communications, has filed an application for review of the Bureau decision. The Commission yesterday asked for comment on the request. Comments are due September 30 and October 15.

The FCC's quick action is unusual in one sense: the deadline for petitions for reconsideration or applications for review of the Denial Order is not until September 14. Other parties to the same order may file additional petitions on the same issue.

ILN-terviews: Andreas Bauer, Brauneis Klauser Praendl Rechtsanwaelte GmbH

Mon, 30 Aug 2010 18:05:51 GMT

Welcome to ILN-terviews, a series of profiles of ILN member firm attorneys, designed to give a unique insight into the lawyers who make up our Network.

For our latest interview, we chose ILN member, Andreas Bauer of Brauneis Klauser Praendl Rechtsanwaelte GmbH in Vienna, Austria. Andreas and his firm are hosting the 2010 European Regional Meeting in Vienna at the end of September.

In one sentence how would you describe your practice?
We are a midsized Austrian law firm, serving our clients in all fields of Austrian and EU Commercial Law.

Who would be your typical client?
Our typical client is a midsized or larger Austrian company, either family-owned or a subsidiary of an international company. We are also working for large consumer protection organisations.

What would you like clients and potential clients to know about you?
We are not one of the big “law factories,” but have the same professional approach as these big firms. The personal connection to our clients is much closer than in these “factories” and we care about our clients.

What has been your most challenging case? Why?
I helped one of my clients to sell his family-owned business to a big US Company. My client was 74 years old at the time and had trouble adopting the “style” with which the American company tried to purchase his lifetime achievement. We finally sold the company for about 15 Million Euros.

What has been your proudest moment as a lawyer?
Working for my parents to sell their farm.

What do you do when you are not practicing law?
I try to dedicate most of my free time to my family, especially to my kids. I love to play soccer and to listen to classical music.

What has been your most memorable ILN experience?
I have to mention two things here.

First, my very first ILN experience more than fifteen years ago in Jerusalem where I met with other ILN lawyers in a more than impressive surrounding. Israel was, at that time, just signing the peace treaty with Jordan.

Second, the friendships that developed over the years within the Network. I don’t want to miss any of these experiences.

What career would you have chosen if you weren’t a lawyer?
I probably would have become some sort of manager, but luckily I decided to become a lawyer.

If a movie were made of your life, who would you want to play you?
Tom Hanks.

How would you like to be remembered?
As a person having a “back bone,” meaning a person that is straightforward, kind and honest.

FCC Preparing Multiple "Junk Fax" Enforcement Actions

Sun, 29 Aug 2010 23:28:31 GMT

There has not been an official announcement, but indications are strong that the FCC is planning soon to issue a number of forfeitures and proposed forfeitures for the sending of so-called "junk faxes." Under the Telephone Consumers Protection Act of 1991 ("TCPA"), it is unlawful to send "unsolicited advertisements" via facsimile. In the past two weeks, the Enforcement Bureau has begun "circulating" 11 new orders that appear to be junk fax enforcement orders. (Circulation is the process of submitting an order for a vote by the Commission.)

The Commission, rather than the Bureau, must vote on all proposed fines above $100,000, so one may presume that each item involves a significant fine. Significant fines also are likely because several of the subjects of the draft enforcement orders have histories of prior FCC enforcement actions. One company -- The Hot Lead LLC -- received a fine of $2.5 million in 2008 for junk faxes. Pending against it are four proposed fines, of $739,500, $695,000, $47,000 and $51,500. Another company -- Sunstar Travel and Tours -- received a fine of $169,500 in 2008 and has a proposed fine of $136,000 pending now.

In addition, one potential action appears to be against an alleged "fax broadcaster." If issued, it would be the first proposed forfeiture issued under the Commission's "high degree of involvement" standard for fax broadcaster liability.

Caveat: Circulation of an item does not necessarily indicate impending action by the FCC. Four apparent "junk fax" orders began circulating in June 2009. 14 months later, those orders remain under consideration.

A Value-based Client-firm Relationship: Part XI

Fri, 27 Aug 2010 16:41:01 GMT

The grocery-strategy connection

Week 11. Each week, via the In-house ACCess blog, follow the promise and pitfalls of forming a new value-based client-firm relationship. ACC Value Challenge steering committee member Ken Grady, General Counsel and Secretary of Wolverine World Wide, offered to profile his selection and start-up process of launching a trademark portfolio management engagement with law firm Seyfarth Shaw. Ken's co-blogger is Lisa Damon, a member of Seyfarth's Executive Committee and leader of the firm's efforts to incorporate Lean Six Sigma into its business. The voice, views and stories expressed by the authors below are their own and not ACC’s. To catch up on the story so far, click here.

The client side

From Ken:

Nutritionists have told us for years that we should develop a strategy before we go grocery shopping. We should plan our meals for the week, deciding what we will have at each meal, and how to do things like sequence the meals to use leftovers. From that plan, we should develop our grocery-shopping list. If you are efficient, you group items on your grocery list according to where the store places those items. When you go shopping, you move efficiently through the store, without backtracking, and you buy only what you need. You don't go shopping when you are hungry, and you don't give in to the temptation to buy those goodies in the checkout aisle.

Lawyers love tasks and checking things off lists, but as much as we advertise our strategy skills to our clients, we often neglect that step ourselves. We don't develop our strategy before we dive into the tasks. Of course, we do use strategies from time-to-time, usually for lawsuits, acquisitions and other transaction events. However, typically, we don't develop strategies for routine work.

For the Wolverine trademark portfolio, Wolverine and Seyfarth are working to develop many strategy tools. These tools will guide our decisions on issues relating to each mark, streamlining pieces of the decision process that today are ad hoc.

We want to make decisions up front about what to do in various situations and know where marks fit into our portfolio before we are confronted with the question. For example, we want to know the relative importance of a mark, and which countries are more important for that mark -- based on factors such as sales levels, related marks and counterfeiting risk. We want to have a strategy for customs surveillance, and a strategy that ties the mark to our domain name strategy. Using these and other strategy tools, we can make decisions quickly. If something pops up on a watch list, we know whether that country is important for that mark, and that guides the decision about what effort to put into a response. We avoid ad hoc decisions that result in our buying things we don't need.

Doesn't it take time to develop these strategy tools? Yes, but not a lot. Once we have the template, the time is in filling out the templates with the assistance of our client. The savings potential is enormous. It can cost thousands of dollars to oppose a proposed registration of a competing mark in one country. If we decided that our mark in that country is not strategically important and we avoid spending the thousands of dollars, then we probably covered the cost of the strategy process for the mark. We avoided the temptation to buy something in the checkout aisle and stuck to our original strategic shopping plan.

Next: Developing a map to the future.

The firm view

From Lisa:

Ken's entry this week talks about developing a strategy before you act. For us, Lean Six Sigma helps provide the discipline for that step.

When I look at how Lean has changed my life as a lawyer, one of the keys for me has been to develop the discipline to stop and think before returning to business as usual. Ken talks about this step in the trademark area; for us, it is a step we try to use in every matter across the spectrum.

A key feature of Lean is DMAIC, a structured way to look at a matter and plan an approach, a strategy. This discipline asks you to:

· Define the problem first -- what are you trying to accomplish? What problem are you solving? It mandates talking to your client, standing in his/her shoes and understanding the issue.

· Next, you Measure. Look at the information/data that you have available (not relying on your "gut" or on the way you have always done something).

· You then Analyze and Improve -- or implement -- the strategy or the solution.

· The “C” stands for Control, which is the discipline of not going back to the way you have always done something, not returning to "business as usual."

Using DMAIC as a framework for the way you think about a legal problem can be no more than a quick mental ‘stop and check’ before you begin a project or a longer more involved discussion. The important thing for me is the pause to think, to consider and to plan -- the strategy that Ken talks about.

Lean provides other tools that I find useful in the world of lawyers -- for instance, the concept of looking at the root cause of problems and the tools designed to help you get there are ones that I use frequently -- not just in law, but in my like life as a manager of people. Too often, instead of stopping and analyzing, we jump to a solution -- lawyers are trained to solve problems. Again, Lean gives us the discipline to stop and consider: Are we really solving the root cause, or are we simply putting a bandage on something that won't last or won’t truly solve the issue?

Like effective project management and process design tools, taking time to plan strategy on the front end almost always saves time on the back end. I believe that strategic planning is not a luxury or an option to use only when time permits, but instead, it is a step that should always be integrated in my thinking -- whether I'm planning the trip to the grocery store or planning a much more complex project for one of my clients. I guess that all of those law school professors were right in the first place: Keep your pencil down in an exam until you have planned the answer!

Next: Working with Ken to map out strategy

Filer Beware: FCC Affirms Tough Stance on Late-Filed Universal Service Forms

Thu, 26 Aug 2010 12:37:22 GMT

In stark contrast to the Bureau's more liberal waiver policy for recipients of Universal Service Funds, the Wireline Competition Bureau recently released orders affirming a tough stance for contributors who miss USF filing deadlines. In the Waiver Order, the Bureau granted two waviers of the deadline to file 499-A revisions. In the Denial Order, the Bureau denied ten requests for similar waivers. The difference? In the Waiver Order, the Bureau found "special circumstances" -- complex revisions undertaken after a merger and late-filing due to the 9/11 terrorist attacks. By contrast, in the Denial Order, the Bureau characterized the reasons for late-filing as "simple negligence."

The Bureau's stance is summarized with this quote from the Denial Order:

We reaffirm the importance of filing revisions to FCC Forms 499 promptly and within the windows established by the Commission's rules and requirements. In order for USAC to process the thousands of forms it receives each year and for contributors to know that their contributions will not dramatically change each year on account of late-filed revisions, filers must comply with the deadlines we have established for filing and revising FCC Forms 499.

As a public service, we remind readers: Corrections to the quarterly estimates (499-Q) are due within 45 days of the due date. Revisions that reduce USF liability for a year (499-A) are due within one year of the April 1 499-A filing date.

Filer Beware: FCC Affirms Tough Stance on Late-File Universal Service Forms

Thu, 26 Aug 2010 12:37:22 GMT

The Bureau's stance is summarized with this quote from the Denial Order:

We reaffirm the importance of filing revisions to FCC Forms 499 promptly and within the windows established by the Commission's rules and requirements. In order for USAC to process the thousands of forms it receives each year and for contributors to know that their contributions will not dramatically change each year on account of late-filed revisions, filers must comply with the deadlines we have established for filing and revising FCC Forms 499.

What I've Been Reading

Wed, 25 Aug 2010 15:29:24 GMT

Dear readers, I have not forgotten about you, but with our European Regional Meeting fast approaching, I've been concentrating on those details and not on my blogging. However, I have been reading some excellent posts from colleagues recently, which I wanted to share with you. So grab a cup of coffee and take a read!

Over at Nancy Myrland's Myrland Marketing, she's been talking about some important messages:

In "Sales is Not a Dirty Word," Nancy reminds us to be our "client's advisor, their mentor, their solution to a problem, and sometimes even their friend."
In "You Are Who You Are. I Am Who I Am," she addresses a lot of the recent bashing we've seen by blog commenters and people on Twitter and encourages us all to embrace each other's differences with a little respect - great message.

At the Legal Watercooler, Heather Morse has been using Mad Men to teach some valuable lessons about legal marketing - even if you're not a Mad Men viewer (which I'm not, but I love a series that connects television with business), her posts offer great points:

In "Mad Men, Lawyers, and Legal Marketing," Heather advises lawyers that it's "YOUR job to turn YOUR success into new BUSINESS," just as senior partner Bertram Cooper from Mad Men tells Don Draper "Turning creative success into business is your work."
In "Mad Men, Lawyers, and Client Relations," she points out that we're all a personality type and "By better understanding how we personally process and receive information, and by learning how to identify how others do the same, we best communicate and work with one another."

In "Mad Men, Lawyers and the 24-hour Layover," Heather gives some of my favorite advice, to extend a business trip by 24 hours once a quarter, and use this time on business development efforts - she gives some excellent tips on how to make the most of this time in the full post.
In "Mad Men, Lawyers...and the 'Competition.' Are you a Pete, or are you a Harry???" she challenges us to look at moving on from a firm (either us or our colleagues), not as something negative, but as an opportunity.
In "Mad Men, Lawyers and...How Big is Your Sandbox?" Heather reminds us of the importance of balance within a law firm, which means that the firm and partners are better situated for growth, weathering economic fluctuations, having a buffer when a partner or client leaves, and fostering a culture of business development and succession planning.

On Samantha Collier's Social Media for Law Firms, she's been offering some great tips to attorneys thinking about getting involved in social media:

In "Three Steps to Start Blogging," Samantha gives clear and easy direction for any attorney thinking about taking the plunge into the blogging world.
In "Is Your Firm on Wikipedia?" she talks about the benefits of law firms having a Wikipedia entry, and her tips for writing one.
In "Facebook's Question's Application - Is there potential?" Samantha discusses Facebook's newest questions feature, the features that will benefit lawyers and the potential for firms.

I will certainly be back to my regularly scheduled blogging soon, but in the meantime, I hope you enjoy a peek into what I've been reading and thinking about!

Overlooked Elements of the Verizon-Google Net Neutrality Proposal

Tue, 24 Aug 2010 13:29:16 GMT

Earlier this month, Verizon and Google announced an agreement on the vexing issue of net neutrality. The agreement has been criticized by net neutrality advocates for allegedly permitting a "private Internet," and for excluding wireless services, among other things. Until recently, the provisions in the Verizon-Google "Legislative Framework" that radically alter FCC enforcement have been overlooked.

Four elements of the Legislative Framework are described in detail in this post. These elements would restrict the tools available to the FCC and would raise the standard for FCC fines. In addition, one provision strips the Federal Trade Commission of any potential jurisdiction over broadband Internet access service.

Limiting the FCC to Case by Case Enforcement. First, Verizon and Google propose that the FCC "would enforce the consumer protection and nondiscrimination requirements through case-by-case enforcement, but would have no rulemaking authority with respect to those provisions." This provision would significantly alter enforcement practice today -- where it is well settled that, absent explicit statutory instruction, an agency may choose whether to enforce through adjudication or through rulemaking. Verizon and Google propose that in this instance rulemaking authority be denied.

Substituting Private Arbitration of Disputes. Verizon and Google also propose that another entity assume the FCC's primary role in adjudicating alleged violations. Specifically, Verizon and Google propose that parties be "encouraged" to use "non-governmental dispute resolution processes established by independent, widely-recognized Internet community governance initiatives," with the FCC granting "appropriate deference" to such opinions. Verizon and Google don't say that parties will be forced to use this alternative, but the clear hope is that the primary enforcement capability will be shifted away from the FCC to this private group. It is not clear whether Verizon and Google contend that the private group will have more expertise than the FCC, that it is quicker or less expensive than FCC formal complaints, or that some other reason makes this desirable.

"Knowing Violation" Standard of Liaibility. The Verizon-Google proposal preserves FCC forfeiture authority, but it appears to substitute a stricter standard than applies to other forfeitures. Under the Verizon-Google proposal, the FCC could impose fines for "knowing violations" of the consumer protection and nondiscrimination standards. This contrasts with Section 503's current standard of "willful and repeated" violations. The FCC has interpreted the "willful" standard to require only that the party knew it was commiting the act (or omission), not that it had any intent to violate the Communications Act.

Exclusive FCC authority. Verizon and Google propose that the FCC have "exclusive authority to oversee broadband Internet access service." This provision apparently would preempt any jurisdiction by the Federal Trade Commission, which has asserted that it may apply its consumer protection standards to information services (which include Internet access services). But it is not clear what the FCC's "oversight" authority encompasses, since all regulatory authorities would be precluded from "regulating" broadband Internet access services.

Until last Thursday, these provisions seemed to be overlooked in the proposal. However, two FCC Commissioners made comments at the "Future of the Internet" hearing in Minnesota sponsored by the Free Press Foundation. Commissioner Clyburn declared that "any proposal that favors the FCC being stripped of the rulemaking authority regarding consumer protection and non-discrimination requirements, and any proposal that would advocate that no agency will have authority over Internet access would be impossible for me to embrace." Commissioner Copps expressed similar concerns, warning that the Verizon-Google proposal "would eliminate any meaningful, effective FCC oversight of the open Internet [including] such critically-important responsibilities as the setting of standards and the swift resolution of controversies." I'm sure we will see more discussion of these proposals as we move forward in this debate.

A Creature of Habit Gets Out of Her Comfort Zone

Fri, 20 Aug 2010 13:07:46 GMT

Much to the chagrin of those who know me well, I am a creature of habit. I sit on the same side in church; the same car and even seat on the commuter train. It upsets me if someone sits in “my seat.” Yes, I know it’s not really mine, but I am in my comfort zone. If I take a different commuter train, then I have to adjust to new conductors and new passengers. It’s almost like being in a new city. But, we all know how comforting yet constricting routine can be.

I cut my professional teeth in the print world of communication. Translated, that means I know what a pica pole is. I also know that a wax machine is not only for cleaning up your eyebrows and I am pretty good with X-Acto knives. I worked on my college newspaper before PageMaker or Quark even hit the design scene. Even so, I have embraced the online world and new technologies; however, I am usually not a first adopter unless it is effective. So, imagine how uncomfortable I was when two ACC colleagues introduced me to microblogging via Twitter. I had a LinkedIn profile that I had to complete since it was going to be posted on my Twitter page. I set up my Twitter account, @eicdocket, in February 2009, and have completely embraced the concept of social media. My LinkedIn account is used at least five times a week. But you won’t catch me on other sites — I only have so much time.

Twitter gives me access to topics and people I normally would not know about or communicate with. Since Twitter only allows 140 character, it forces me to write succinctly — a trait all of us should strive for. It serves as a communication tool for my employer when we launch a new magazine issue, blog post or news event. Yes, I even use it for personal observations, comments or thoughts; I use my best judgment to make sure I don’t take it too far. However, this isn’t always the case online, and employers are grappling with how to deal with social media because it’s not going away.

This month’s ACC Docket cover story, “Are You Building a House of Cards? Social Networking in the Office” asks if you have a clear social media policy for your clients because “what happens in Vegas,” doesn’t always stay there. And, if you need more on social media, then read “Identifying the Legal Issues Lurking Behind Walls and Tweets” and “Social Media Game Plan: IP and Marketing Law Playbook.”

If your multinational company is not familiar with US-style discovery, make sure you read “Tips and Traps in Conducting Discovery of Foreign Corporations.” “Building Blocks for Corporate Ethics” is an excellent refresh of your knowledge in this area. Protecting your customers’ privacy should always be a priority, so “A Balancing Act: Protecting Customer Interests and Privacy Online” helps in-house counsel strike a balance between the two. Further, neither in-house nor outside counsel should miss “Evidence Preservation Warfare: Ediscovery Lessons Learned from AMD v. Intel.” Written by AMD’s legal team, this piece provides excellent points to remember as you preserve data within your company.

Make sure you always read our columnists. We knew their work was award-winning even before publishing peers told us so. Infusing humor, perspective and knowledge in 700 words or less is never easy. Try doing it in 140 character or less. See you on Twitter.

A Value-based Client-firm Relationship: Part X

Thu, 19 Aug 2010 21:44:16 GMT

The power of project management

Week 10. Each week via the In-house ACCess blog, follow the promise and pitfalls of forming a new value-based client-firm relationship. ACC Value Challenge steering committee member Ken Grady, General Counsel and Secretary of Wolverine World Wide, offered to profile his selection and start-up process of launching a trademark portfolio management engagement with law firm Seyfarth Shaw. Ken's co-blogger is Lisa Damon, a member of Seyfarth's Executive Committee and leader of the firm's efforts to incorporate Lean Six Sigma into its business. The voice, views and stories expressed by the authors below are their own and not ACC’s. To catch up on the story so far, click here.

The client side

From Ken:

First year efficiency gains in the trademark portfolio require that we know our starting point. To know our starting point, we must have our arms around 3,600 trademarks, all moving at their own pace. That requires a seamless transfer of 3,600 trademarks to Seyfarth, and that requires excellent project management.

Let me talk about the Wolverine side of that equation. There are four of us who day-to-day touch the trademark portfolio. The old school way consisted of lots of e-mails, hallway chats, catch-up meetings and follow-up e-mails. We kept the ship running but it didn't look pretty. This transition brought us the opportunity to upgrade.

We established a several month transition schedule, rolling from our less complicated brand collections of trademarks to our most complicated collection. Approximately every two to three weeks, another brand moves to Seyfarth. Every week, we have a WebEx conference for the Seyfarth and Wolverine team. Using one of Seyfarth's project management tools, we work through (1) transition status and issues, (2) portfolio issues for the brands that have moved, and (3) general issues affecting the portfolio. The online tool lets us systematically work through each issue, coded using several criteria including importance and due date, to update the team. Since it is something we all can access at any time, the call gives us a chance to quickly identify any needed action items. We don't resolve many of them in the call - they are put on the list for separate in depth calls as needed. The call takes one hour, but keeps everyone on top of the issues.

Separate calls are scheduled, including one regularly scheduled call each week between Seyfarth's lead attorney and our lead paralegal, to cover in depth some of these issues. We have other ad hoc calls (and some e-mails) as needed. This sounds oh-so-straightforward and it is, but that is because the groundwork for a well-run project management process was put down by Seyfarth long before we darkened their doors. Oddly enough, I used a similar process some 16 years ago in the early ages of computer video conferences. The key here is that, while Seyfarth's implementation is much more elegant than the old version I did, the concept of project management isn't new and doesn't require huge amounts of time. In fact, properly done project management will significantly reduce the time it takes to keep things on track versus the ad hoc method we used and many of you may still use.

Another factor here is constant improvement. Each week the Wolverine/Seyfarth team improves the process management process. We are handling more brands and issues as they transfer to Seyfarth, but we still do so in an hour or less. We also have started the real lean process - the team held its first process mapping session last week. Through a WebEx, team members from both entities started mapping out the process for trademark searches. This is the first step in defining what we do today to give us that springboard for improvement. Just as we break complex legal matters into manageable pieces to solve the legal challenges, we are breaking this complex portfolio project into manageable pieces to handle the transfer and start "leaning" the processes.

Next: Strategy tools - how to get there by knowing where there is.

The firm view

From Lisa:

We have been pleased and excited about the reception that Ken and his team have given to the various project management tools we have adapted for our trademark practice. Ken's strong interest in Lean and his focus on the creation of a value relationship dovetail well with a number of previous projects we have undertaken to improve our global trademark portfolio management practices and file transition procedures.

We began our Lean trademark journey a little over a year before we met Ken, when the firm was already well into its larger adoption of Lean. The driving force behind the Lean trademark program was the perception that traditional law firm trademark practice, like many areas, contains various inefficiencies that increased cost and wasted time (increased "pendency" in our nomenclature). The net result? Ad hoc decision making and a focus on fighting day-to-day fires, at the expense of strategic thought and action. We tried to attack these problems through a combination of process standardization (we have "process mapped" ten standard tasks within the trademark practice), project management approach, and the development of new technology tools to improve client communication, collaboration and information management in the trademark practice.

As with any development project, the path wasn't always completely clear, and we made some mistakes before joining forces with Ken. In one case, we created a standardized process for a task that had previously been only loosely coordinated among various team members. After about three months, however, we realized that the new standardized process actually increased our cost and the time spent on that particular task -- costs that the firm absorbed as "R&D" for the program. After that experience, though, we developed "version 2.0" of that process map. Ultimately, we reached a solution that was an improvement over both version 1.0 and the prior practice.

We've also benefited greatly from our interaction with Ken's team. As we began to implement our trademark extranet product for Wolverine, Ken and his team were not shy about guiding us as to how the tools would best work for them. Ah, the power of feedback!

We then customized our platform in a manner that's actually much better than the original. Our experience reflects a critical point about building a relationship: Providing value and efficiency can't be a one-way street. While we have brought some innovative tools to the table, Ken's team has been extremely engaged in the implementation and adaptation of them. They have given us valuable feedback along the way. Had it not been for the level of engagement from Ken's team, the implementation would not have been as effective. That's where genuine partnership in the relationship becomes essential.

For those of you using project management tools in your practices, what is working? How has the collaboration been between in-house and outside counsel? What tips for success can you share for the benefit of others?

Next: Continuing the transition and working toward development and implementation of an effective strategy.

A Value-based Client-firm Relationship: Part IX

Fri, 13 Aug 2010 18:50:49 GMT

Translating value and metrics into fees

Week 9. Each week via the In-house ACCess blog, follow the promise and pitfalls of forming a new value-based client-firm relationship. ACC Value Challenge steering committee member Ken Grady, General Counsel and Secretary of Wolverine World Wide, offered to profile his selection and start-up process of launching a trademark portfolio management engagement with law firm Seyfarth Shaw. Ken's co-blogger is Lisa Damon, a member of Seyfarth's Executive Committee and leader of the firm's efforts to incorporate Lean Six Sigma into its business. The voice, views and stories expressed by the authors below are their own and not ACC’s. To catch up on the story so far, click here.

The client side

From Ken:

In all the fun of setting up our new trademark portfolio representation and fee arrangements, one thing I can’t overlook is the equally fun world of accounting. Our company focuses on building brands, and with about 3,600 trademarks in the portfolio those marks are an important part of our brand building process. Since they are valuable assets, we need to track the asset value from day one. In the old days, this was relatively straightforward, yet somewhat tedious. For each mark, we captured the dollars spent on acquiring the registration. That meant hours times billing rate plus expenses. Once the mark registered, we expensed the costs of keeping the mark so they were not built into the asset value.

As we work out our new structure with Seyfarth, the accounting piece becomes a bit more complicated. While Seyfarth will keep track of the time it spends on each mark, our fee structure looks at the total work performed by Seyfarth (with some exceptions, such as litigation) and puts that under one umbrella figure. We then adjust that figure based on factors such as efficiency gains.

That means we need to develop a way to determine the initial value of a mark. The method I am considering is to take the total number of hours worked by Seyfarth in a given period (e.g., a quarter), divide the total payments to Seyfarth for the quarter by those hours, and take that resulting rate times the number of hours worked on a particular mark application as the “value” generated for the asset during the period.

While the calculation works, it raises some questions. Is the “value” of the mark really determined by this “hours times average rate calculation”? Should the initial value of a mark be determined by the average cost to obtain a mark rather than the specific time spent obtaining the mark (this assumes all marks are of equal value out of the box even though some required more work than others)? Should the initial value be unrelated to the costs to obtain the mark, and instead be based on something else, for example, some metric based on sales during the period prior to when the mark is registered?

I’m sure the valuation experts could chime in with many other thoughts on how to get to the initial value of a mark and would point out various flaws with the methods I have listed. I’m not trying to get to the right answer in this post. My point (and I do have one), is that as we push ahead with modifying the way we compensate outside counsel we have to work with other groups to modify their thoughts about valuation. Many of our colleagues have learned to think about lawyer’s services based on hourly rates and have adapted their systems to this model. Educating others--corporate controllers, CFOs and CEOs – that the hourly rate is not an appropriate model is part of the process.

By the way, if anyone does have a great model for determining initial trademark values, please let me know.

Next: What are reasonable first-year efficiency gains?

The firm view

From Lisa --

Ken's last few posts have outlined critical standards and metrics of value that he expects us to deliver at different levels -- strategic, artisanal, industrial. During this time, we also have worked to demonstrate to him that we have the right expertise, chemistry or fit, and that an ongoing relationship with our firm would make sense to him and his team. (Chemistry and fit is important from our perspective, too, but hey, Ken’s the client!) We also have begun to build the principal process design and project management mechanics of the first big project, the trademark initiative.

Now, our team is challenged to take all those needs and address them in a cohesive fee package that reflects Ken's definitions of value and also provides us with an appropriate return.

Here are some of the considerations and challenges we are working through as we develop our pricing structure:

As Ken has pointed out, some part of the value we deliver must be understood in terms of what we can contribute to asset development and enhancement, starting with what it costs to create the asset in the first place -- a specific trademark, for example. This work is the “industrial” activity that Ken has described. It is the core blocking and tackling that has been the mainstay of outside providers in recent years.

From our perspective, the development of the pricing model for this “industrial component” offers deep potential for innovation. It is one of the places where we have a real chance to advance the model from the traditional "hours times rate approach" -- with its inherent inefficiencies -- to a strategy that rewards both quality service and efficiency minded delivery. Early examples of innovation in this area involved moving away from straight billable hours to applying simple flat fees for a menu of individual tasks associated with trademark prosecution. A more advanced, qualitative model would charge a flat fee for a trademark registration, all-in, from filing to registration, thereby having the law firm bear some of the risk for issues that might arise in the registration process. More recently, fee structures have evolved into a single flat annual fee for the management of all activities for an entire trademark portfolio. And to this model can be added a gainsharing feature whereby the law firm and the client both participate in the benefits of reduced costs that result from greater and greater efficiencies.

By taking this kind of an approach, we are creating rich opportunities for ourselves (1) to develop a pricing alliance with our clients, (2) to build efficient workstream processes and effective project management capabilities, and (3) to enable us to then turn around and share the benefits with our clients. As our discussions with Ken on pricing advance, we expect and look forward to the development of a model centered on these principles.

We will focus on driving efficiency through the volume of 'industrial' work we will do on trademarks, so that we can focus on adding greater value to the strategic use of those marks. This is the 'artisanal' level of value that Ken has mentioned. We will be proposing strategies that will create value for the business through better deployment of intangible assets -- trademarks, patents and other forms of IP -- that are chiefly a creature of the law. One way we can do this for Ken is to through the better management and communication of data about his trademark portfolio -- his active matters, his registration coverage, his enforcement activities, his risks, etc. -- to enable him, his business units, and us to rise above the fray of day-to-day trademark issues and make strategic decisions about the global direction and objectives for his brands.

This type of value may be measured with additional tools that fall more into the kit of the financial analyst than the accountant, using metrics like discounted cash flow, or comparators, or whatever. Although efficiencies are also important in this context, this may be more the place for discussions about the client’s subjective, gut level, sense of contribution by the outside provider. In this context, our pricing model may need to build in metrics or drivers beyond cost-efficiency -- such as strategic contribution and trademark value improvement -- that appropriately measure success and value.

To be successful at the 'artisan' and strategic levels relies on a strong relationship between client and outside provider, so our fee and metrics package also to measure the level of trust and confidence between client and firm. We have metrics in place to both measure the success of our efforts as a relationship. These come from our initial 'voice of the client' discussions, as well as scoreboard metrics, derived from the ACC's Value Index. We think that’s why Ken started with relationship in the first place.

Next: Delivering on first-year efficiency gains

2010 Regulatory Fee Update -- FCC Begins Accepting Payments

Tue, 10 Aug 2010 12:56:34 GMT

It's official -- FCC regulatory fees are due on August 31. Here are the links you will need to make payment by the deadline:

FCC announcement of the August 31 deadline

FCC public notice -- Payment methods and procedures

FCC public notice - Fee filer system

FCC public notice -- ITSP fees (with payment code)

FCC public notice -- Commercial wireless fees (with payment code)

FCC Regulatory Fee website

A Value-based Client-firm Relationship: Part VIII

Thu, 05 Aug 2010 20:30:36 GMT

Balancing strategic roles and tactical delivery

Week 8. Each week via the In-House ACCess blog, follow the promise and pitfalls of forming a new value-based client-firm relationship. ACC Value Challenge steering committee member Ken Grady, General Counsel and Secretary of Wolverine World Wide, offered to profile his selection and start-up process of launching a trademark portfolio management engagement with law firm Seyfarth Shaw. Ken's co-blogger is Lisa Damon, a member of Seyfarth's Executive Committee and leader of the firm's efforts to incorporate Lean Six Sigma into its business. The voice, views and stories expressed by the authors below are their own and not ACC’s. To catch up on the story so far, click here.

The client side

From Ken:

Lisa and I have been talking about the role of outside counsel as we discuss this burgeoning relationship. I suspect this discussion is controversial, because to some in-house counsel it sounds like a threat. It has taken decades for in-house GC’s to evolve into their current role as valued senior executives. Not long ago, the GC’s role was to channel work from inside to outside. Why should GCs now invite outside counsel to sit at the table and potentially drain away that power? In the context of these posts, why should I invite Seyfarth to sit at our table?

The answer is more complex than a 500-word blog post will allow, but here is my quick take on it. A good GC, and increasingly a good global GC, should emulate many of the same behaviors as good global CEOs. Good CEOs consistently recognize that their companies benefit by having many minds at the table. Their personalities help them channel those minds to achieve goals more effectively than each CEO could do through his or her own efforts. With an ever-expanding regulatory environment, business models increasing in complexity, and black swans circling just out of sight, even GCs of relatively simple businesses need that collective power working through the risks their clients face.

I think some GCs feel threatened that having outside counsel at the table will result in the CEO seeing the outside counsel as the true advisor. More effective GCs will overcome this hesitation and have confidence in their own abilities, in their relationships with their internal team and with outside counsel. Outside counsel who have a weak relationship with the GC or who have interests that are poorly aligned with the company’s interests won’t be good partners and may show that the GC’s fears were well-founded. That, to me, is another reason why I want to spend the time building a strong relationship with outside counsel and why I want a fee relationship that aligns interests.

Another way to think about the goal of a value fee relationship is to compare it to the compensation structure for senior executives (beware the metaphor). In simple terms, a well-constructed compensation structure should, among other things, (1) align the interests of the senior executives; (2) align the senior executives’ interests with corporate goals; and (3) provide clear rewards for achieving well-defined goals. Since my outside counsel are an extension of the in-house team, I would like to see our interests aligned, I’d like to have our outside counsel’s interests aligned with our corporate goals, and I’d like to provide them with clear rewards for achieving well-defined goals.

So, Seyfarth and I are talking about Seyfarth’s role at the table. This means drawing them into the strategic discussions with our internal business partners, but it also means understanding that their fee drives off that strategic work. In linkage terms – our portfolio is a risk management tool and a strategic tool. We tend to understand the risk management piece, so now we are working on the strategic piece – how do we tie Seyfarth’s role to the in-house team’s role to our corporate strategic objectives.

Next: Tying in some of the messy accounting stuff.

The firm view

From Lisa:

As Ken notes, one of the roles of outside counsel in delivering value must be that of strategic business advisor. Done right, we know that this advisory role can both complement and strengthen the GC’s position with his or her executive leadership. While Ken, or his GC counterpart at another company, will always know the organizational issues, context and culture better than we as outside providers, our very exposure to a host of different clients, with a range of risks and risk management strategies, may put us in a very good position to round out the GC’s and legal team’s analysis. We can bring a depth and diversity of perspective to the GC’s table, fully participate as a team member, and add value at the highest level.

While these strategic role discussions continue, we also have to manage the other half of the value equation -- the ‘industrial role’ that Ken referenced last week -- and get things done quickly and efficiently.

For our weekly readers, you may be wondering what we have been up to on the ground? Well, a lot. To date, we’ve transitioned six of the Wolverine brands, or about one sixth of the company’s portfolio (roughly 600 of a total 3,500 marks). And, working with Ken and his team, we’ve done this rapidly and efficiently in less than 60 days.

Because Wolverine’s trademark assets are central to the company’s business, we knew the transition process had to be delivered on-time, on-budget and on expectation. We have been using project management resources to help us get the job done. As we have adapted lean six sigma to the world of a law firm and its clients, project management has been a key component of what we have implemented. We combine it with a set of Lean tools and disciplines but we rely on our client-facing project management office to help drive our internal and external teams.

There are a number of successful ways to apply project management skills and tools to legal work, such as those identified by LegalBizDev blogger Steve Barrett (link to: How Should Law Firms “Gear Up” to Manage Projects Better? – A 50,000-foot View (Part 2 of 2). For our work with Wolverine, we wanted our project management role to play an integral and strategic role in delivering client value and help drive the success of our relationship:

· Program Management: To begin the transfer process, Wolverine provided us with an initial schedule, which served as our foundation for development of a high-level timeline and accompanying detailed project plan. To ensure we stay on track, our internal team meets weekly to obtain status, discuss issues and share lessons learned to improve processes for the transition of the remaining brands.

· Collaboration: An essential element to this partnership is collaboration with Wolverine's former trademark firm. To facilitate an aligned effort, we developed a process map, checklist and protocols for the intake processes of these files to ensure data accuracy and to procure knowledge of Wolverine's trademark portfolio.

· Knowledge Management: In our ‘Voice of Client’ interview, Wolverine emphasized the importance of transparency and real time knowledge management capabilities. In response, we created a shared knowledge platform, using our Firm's extranet capabilities. The tool is designed to improve knowledge transfer, minimize risk and provide full transparency of status and priorities including key documents, metrics, etc.

· Process Management: We have scheduled the first of several joint process mapping sessions to be facilitated by Seyfarth's Project Management Office. We will conduct virtual sessions with key stakeholders to develop an improved process for handling various aspects of the trademark portfolio. We will also use these sessions to identify and/or develop template documents, checklists and guidelines to further enhance and promote best practices for the newly defined streamlined processes.

The effort to define the ‘rules of the road’, our relationship needs to move ahead on multiple fronts. So far, we’ve used several Lean tools and a healthy dose of project management to ensure a successful transition, and it will be vital to our ongoing strategic partnership with Wolverine--both from the industrial and artisinal perspectives. All of this though, is just the tip of the iceberg. We haven’t thought of everything and as they say, ‘more minds are better than one.’

That said, how have you used legal project management and how has it contributed to your client-firm relationships?

Next: Next stage of the fee discussions and more reports from the ground.

A Value-based Client-firm Relationship: Part VIII

Thu, 05 Aug 2010 20:30:36 GMT

Balancing strategic roles and tactical delivery

The client side

From Ken:

Next: Tying in some of the messy accounting stuff.

The firm view

From Lisa:

That said, how have you used legal project management and how has it contributed to your client-firm relationships?

Next: Next stage of the fee discussions and more reports from the ground.

FCC Picking Up the Pace on Omnibus CPNI NALs

Wed, 04 Aug 2010 19:04:07 GMT

In February 2009, the FCC proposed $20,000 fines against 600 carriers for failing to file their annual CPNI certifications. The problem with issuing 600 fines of $20,000 each? The FCC actually has to issue orders in all 600 cases. That process has turned into a bureaucratic quagmire, but -- finally -- there are signs that the FCC is making progress toward resolving the cases.

The Commission got off to a good start: In the summer of 2009, it released 58 orders canceling forfeitures (based on proof that the entity either filed on time or was not required to file) or settling cases against, primarily, very small telcos. After September 1, 2009, however, the FCC did not release another order resolving the Omnibus CPNI forfeitures for almost a year.

Beginning in June of this year, the pace picked up again. Since June 11, the FCC has issued over 40 orders resolving the Omnibus CPNI NALs. One order canceled 15 NALs, again because the entities provided sufficient proof of timely filing. The rest have been settlements of the NALs. They follow essentially the same form: (1) the carrier agrees to implement a Compliance Plan; (2) for two years, the carrier agrees to provide a copy of its CPNI certifications to the Enforcement Bureau; and (3) the carrier pays a small settlement amount. Thus far, the settlements have ranged from a few hundred dollars to a few thousand dollars -- far below the $20,000 proposed.

By my count, the FCC has resolved about 110 cases. It has just under 500 left to go.

Law Firm Salaries: Am I Having a Bad Dream?

Tue, 03 Aug 2010 19:54:54 GMT

Someone tell me I’m having a bad dream and will awake soon.

The greatest gift offered to law firms in the recent economic downturn was the first realistic opportunity in decades to break their own cycle of shame/pain to rebuild their compensation structures. They had the economic justification to cut back on some of their more extravagant hiring practices (like hiring 100 associates each year when they only intend that 20 will make it to partner). As a result of the client-led (r)evolution, firms started to push forward a focus on “value” rather than “prestige” pricing based on top-level comp and regularly rising rates. But now it seems that law firms are turning up their noses and are returning the gift they were given: maybe it wasn’t exactly what they wanted.

I’ve been hearing rumbles, now confirmed in articles such as this one that firms are proudly announcing that they’re returning to pre-2008 salary levels and upping their starting associate comp back to $160,000+ (and therefore the salaries of everyone up the ladder in firms that still use lockstep comp systems also goes up). Seems that firms are doing gangbuster business “selling” their entry associates’ work to clients — they can’t get enough! Or maybe it’s just that there aren’t enough entry-level lawyers for all the first year jobs that firms have to fill? Not.

Let’s just pretend that this is truly a necessary step for firms (which I’m not buying for a minute); the optics of this are so awful that I’m shocked anyone would want to announce their intentions to raise salaries where clients will read about it. Set aside the issue of whether increases like this will really attract the best associate candidates or only the ones most interested in the money. Do firms think that raising entry-level salaries and then raising rates to pay for it actually impresses clients? Is this how law firms flex their muscles so we can see how strooooong they are, even if it does nothing to promote their intelligence or value? We at ACC know that too many clients are still too beholden to the “prestige” or legacy factors inherent in hiring the most expensive firms. Sometimes those firms truly do provide great service; but an increasing number of other firms are capable of delivering similar results without the higher costs and clients are more and more likely to try them out. And the latter firms are getting more and more attention — firms that ignore this, do so at their own peril.

Many large firms have been caught for decades in a ridiculous and self-fueled cycle of “Keeping Up With the Joneses”, wherein firm management bitterly complains that while they know their comp systems are not based on sound business principles, they claim to be victims of a marketplace in which they can’t hire anyone worthy of their firm if they aren’t paying more than the other firms in town. Since we see no shortage of smart talent graduating from law school each year, many of us had a sneaking suspicion that the reason the firms kept raising starting salaries was more connected to a decision about what the partners in the firm were making or wanted to make.

In general, I have no problem with firms paying whatever they want for talent, especially lateral talent. Frankly, clients shouldn’t have to be worried about what firms set as their standards for comp if the firm is pricing its services in a manner that the client finds reasonable and valuable. But most firms are about to approach their clients and suggest they need an increase in fees, dictated by rising costs, that they’ve just invented.

Wouldn’t it be wonderful if more firms adopted a different approach that might include:

1) a commitment to hire new entry lawyers at whatever they believe those lawyers are worth, and they plan to invest in them and train them so that they will succeed;

2) offering new lawyers promotions and higher compensation as they master certain competencies, and that clients thus will not be charged for their services in a manner that is not commensurate with the value of the work they can provide; and

3) a commitment not to raise salaries and therefore costs and thereby request an increase in fees, but rather a commitment to take a page from the client’s business management book, and look for ways to lower client costs by increasing the firm’s efficiency or productivity, or structuring their staffing or costs based on what the client wishes to afford.

There are a lot of firms out there doing this, and their efforts are far too often not noticed — visit ACC Value Challenge to read about firms that are working hard to do better: And let me shout out a few here that are putting their money where their mouths are in terms of deploying new comp systems that incent value: Howrey, Drinker Biddle, McKenna Long, Valorem, Morgan Lewis, Sutherland, and many more. Have they figured it all out? Probably not and they’ll continue to struggle to get it right. But they’re positioning themselves not just for profitable relationships with their own lawyers and clients, but for long-term success as firms.

To leaders in firms considering whether to return us to the madness of ever-upward-spiraling salaries: Please stop. Your clients know that the emperor has no clothes. Are you really going to tell them you can’t hire talent unless you increase the rates of starting associates in your firm? Clients are watching to see what you do. So I’d suggest this is your chance to lead, rather than claim you have no choice but to follow.

FCC Regulatory Fees Likely Due in August

Sun, 01 Aug 2010 18:16:15 GMT

In July, we reported that the FCC had adopted its FY 2010 regulatory fee schedule. In past years, regulatory fees were due in September, usually in the third week of the month. However, it looks like this year's fee will be due significantly earlier -- by August 31, 2010.

The first hint of an earlier due date appears in the FCC Regulatory Fee Order released on July 9. The order did not establish a due date for regulatory fees, but the Commission stated that it intended to collect fees "during an August 2010 filing window." (see paragraph 1). That made us curious, but not convinced. Last week, however, the FCC released a public notice concerning fees for its radio and TV licensees. That public notice states that the media services fee is "due no later than 11:59 PM, ET, on August 31, 2010." This seems a pretty good indication that fees for all filers will be due earlier than in years past.

Given that late-paid regulatory fees are subject to a mandatory, non-waivable 25% late payment penalty, carriers should plan accordingly.

ILN-terviews: Maxim Avrashkov, Maxima Consulting & Law

Thu, 29 Jul 2010 15:00:29 GMT

Welcome to ILN-terviews, a series of profiles of ILN member firm attorneys, designed to give a unique insight into the lawyers who make up our Network.

For our latest interview, we chose ILN member, Maxim Avrashkov of Maxima Consulting & Law in St. Petersburg, Russia.

In one sentence, how would you describe your practice?
We are a mid-sized firm, practicing in all fields of Russian and international private law.

Who would be your typical client?
Our typical client is a mid-sized or larger Russian company leading an International activity or a nonresidential corporation making investments in Russia.

What would you like clients and potential clients to know about you?
The professional level of our team, the internal standards we set upon ourselves, and the spirit of our team.

What has been your most challenging case? Why?
That was a serious financial transaction between our Russian client and one of the Bahamian banks, which required me to stay for three weeks in the Bahamas. I wish I had more such deals.

What has been your proudest moment as a lawyer?
When I provided my first consultation to my grandma during my last year in college.

What do you do when you’re not practicing law?
I travel a lot with my family and play my favorite sports: tennis, football, boxing, and car racing.

What would surprise people most about you?
That I am going to be a champion in rally race next year.

What has been your most memorable ILN experience?
My most memorable ILN experience was my first ILN European meeting in Rome, especially the Gala Dinner in Castel Sant`Angelo.

What career would you have chosen if you weren’t a lawyer?
I would have been dealing with some kind of finances or maybe become a race driver.

If a movie were made of your life, who would you want to play you?
Al Pacino.

How would you like to be remembered?
As a professional and respectable businessman, and a charity activist.

A Value-based Client-firm Relationship: Part VII

Thu, 29 Jul 2010 13:45:30 GMT

Industrial, Artisanal, or Both?

Week 7. Each week via the In-House ACCess blog, follow the promise and pitfalls of forming a new value-based client-firm relationship. ACC Value Challenge steering committee member Ken Grady, General Counsel and Secretary of Wolverine World Wide, offered to profile his selection and start-up process of launching a trademark portfolio management engagement with law firm Seyfarth Shaw. Ken's co-blogger is Lisa Damon, a member of Seyfarth's Executive Committee and leader of the firm's efforts to incorporate Lean Six Sigma into its business. The voice, views and stories expressed by the authors below are their own and not ACC’s. To catch up on the story so far, click here.

The client side

From Ken:

Let’s forget the math and look at the concept of my last post. As Lisa has noted, we aren’t just talking about trademark portfolio values. The concepts here can (and in my opinion, should) be applied to many interactions between clients and law firms. If law firms mostly aim for good quality service at an acceptable price they will work towards the Wal-mart model. I think those firms want to thrive over the long-term need to define what value they add to the relationship. Doing good legal work is the threshold not the value. Value in a transaction isn’t simply documenting the terms of the deal – it could be identifying with the client the key risks and presenting creative ways to minimize those risks (see Bob Profusek’s thoughts on the role of lawyers in a transaction). Value in a lawsuit isn’t simply being an effective litigator, it is finding a creative way to resolve the litigation quickly and for low cost (defendant) or high return (plaintiff).

Looking at the model from the last post, Seyfarth’s value is helping us handle the day-to-day needs of portfolio expansion efficiently while finding creative ways to help us increase the value of the portfolio. The efficiencies reduce the time the firm (and Wolverine) spends on the routine but necessary portfolio management steps. Gainsharing with Seyfarth gives the firm an equal incentive to continue looking for and rooting out inefficiencies. We incent the firm to drive value by adding the topper fee. The key here is not whether the example has the right percentages assigned to each part of the equation. Rather, the key is that we are linking the client and the firm so they share incentives to improve and share in the value created through that improvement.

The purchasing specialists may tell us to get three bids and choose the best cost-to-service relationship. I think that model works for pencils, but not for high value-added services. Legal services do combine industrial and artisanal components. A firm should be competitive on the industrial component and earn its keep on the artisanal component – the part where the knowledge and abilities of the firm’s attorneys really shine. Purchasing services involves selecting the firm that you believe is best positioned to add value in your client’s situation.

I know comparisons are fraught with risk from my litigation days when my opponent would turn my well-crafted metaphor on its head in closing. But, one comparison that might help here is the high-end consulting model – for example, Boston Consulting Group (“We partner with our clients to deliver customized solutions that resolve their most significant issues and create lasting competitive advantage.”). The analytical work BCG provides is the industrial component. Many firms have the financial competence to do the data gathering and calculations. The value-add is in the transformation of that data into solutions that give a company a “lasting competitive advantage.” That value-add, the artisanal component, is why Boston Consulting Group charges what it does for its services.

Next: The fee discussions progress

The firm view

From Lisa:

To us, Ken’s last post is really important. Although our recent discussion has been in the context of fees, in some ways, it’s getting to an even more fundamental question. Namely, what do clients in the post sub-prime world truly want from their law firms, investment banks and other professional service providers and what role do we wish to fill? Ken’s post makes our choices pretty clear.

Ken’s framework asks us to choose whether we wish to be a quality services provider that is a necessary part of our client’s infrastructure or do we wish to seek a job as a member of the client’s strategic team.

We could decide to set our goal as being one of the best providers of commodity services in the profession — provide “good quality service” at an acceptable price across our entire portfolio. It’s a fine goal and in some respects could represent a more conscious acceptance of the role that many law firms, investment banks, accounting firms and consultancies moved closer to over the last twenty years or so. It’s the industrial role in Ken’s post.

On the other hand, we can choose to try and increase our relevancy to the client. As Ken points out, that aspiration means that first and foremost we need to understand that the deliverables we produce are far less important than the counsel we provide and the strategic contribution we offer. The deliverables are simply a tangible result of a much deeper relationship with clients. It’s the artisanal role, the transformational service that Ken describes in his reference to BCG’s work.

In that role, the clients want us at the table to contribute meaningfully to the conversation. Our documents, spreadsheets, financial statements, SWOT analysis, all of that, are just tools we provide to the client as a by-product. That by-product output does not get us hired in the artisanal role nor does it keep us hired. It’s our capacity to provide a contribution further down the value chain that matters in that context.

As a profession, lawyers used to serve the strategic role as a traditional part of their client relationships. We worked hard to help the client think deeply about their business and contributed to their effort to set direction. In serving that role, we earned the right to be perceived as “Counselor” and slept better at night for it. It was a privilege of the profession.

The press of business, the continued push from a model that increased revenue as a function of time spent, business atmospherics and perhaps the expectations of the clients themselves moved many in our profession and in other professions ever closer to the role of infrastructure providers. At the same time, we moved further away from our role as a valued counselor and our relevancy to the client decreased by the same measure.

All of that is exactly why this conversation is so important to our firm and why we perceive our relationship with Wolverine as a defining moment, as one of those once in a blue moon inflection points calling for us to chart consciously our future course. Although much of the discussion surrounding value in our profession is expressed in terms of fees and their newest compelling models, Ken makes it clear that all of us involved are actually trying to get to an even more important question. What does value really mean and what is necessary to get there?

In some senses, Ken’s answer is simple--we choose our seat the table.

Next week: Approaching these discussions in our relationship with Wolverine

Recent Articles in General Counsel Blogs from LexMonitor

Mobile Content Providers Settle Unauthorized Billing Class Action

Late-Filed Forms Update: Airband Seeks Review of FCC Denial

ILN-terviews: Andreas Bauer, Brauneis Klauser Praendl Rechtsanwaelte GmbH

FCC Preparing Multiple "Junk Fax" Enforcement Actions

A Value-based Client-firm Relationship: Part XI

Filer Beware: FCC Affirms Tough Stance on Late-Filed Universal Service Forms

Filer Beware: FCC Affirms Tough Stance on Late-File Universal Service Forms

What I've Been Reading

Overlooked Elements of the Verizon-Google Net Neutrality Proposal

A Creature of Habit Gets Out of Her Comfort Zone

A Value-based Client-firm Relationship: Part X

A Value-based Client-firm Relationship: Part IX

2010 Regulatory Fee Update -- FCC Begins Accepting Payments

A Value-based Client-firm Relationship: Part VIII

A Value-based Client-firm Relationship: Part VIII

FCC Picking Up the Pace on Omnibus CPNI NALs

Law Firm Salaries: Am I Having a Bad Dream?

FCC Regulatory Fees Likely Due in August

ILN-terviews: Maxim Avrashkov, Maxima Consulting & Law

A Value-based Client-firm Relationship: Part VII