A sluggish economy may be the perfect time to build in-house legal staff - San Francisco Business Times:

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The talent pool has grown 40 percent to 50 percent year-over-year, said Julie Brush, co-founding consultantf at LLC. In that kind of environment, companies with theid own budget constraints can renegotiatse fees with outsidecounsel — or find new firmse and lawyers to do the same business for less. Mary Beth Sinclair, a branch director at Robert Half a legalstaffing consultancy, said companiez have begun bringing more work in-house and are quicklh discovering that, for some having on-board specialists can be a money-saving alternative to outsidd counsel.
She said Robert Half is seeing a big increasw in companieshiring in-house intellectual property attorneys with paten prosecution and licensing expertise. “That’s mainlty because there are more of those folks availablee over the last three to four Sinclair said. “We’ve been talking to some outstanding peoplwe recently coming out of some of the big firmsz who were making quiter a bit of money and find themselvesw unemployed for the first time intheir careers.” Compensation for in-hous counsel, even at the senior level, is much less than outsidee counsel rates.
Brush said companies could realizee a savings of up to 200 percenyt by bringing onan in-housew attorney at a salary of “Let’s say you have a lot of licensingv and commercial contracts transactions. If you calculatw sending all that work tooutside counsel, even to a juniofr associate who’s billing out at between $300 and $350 an hour do the math. It’s an enormous savings,” Brush said. But don’t expecft that window of opportunity to remainopen forever. “That pool driess up as the economy starts to warnedRoss Veltman, a principal at corporatew counsel staffing consultancy and executivre director of the .
Said simply — don’g wait, according to Most companies look to buil their internal legal departments in the boom timew when the business operations need increasedlegal support, better response from outside counselp and faster turnaround time. But that’ exactly when attorneys at law firmws andexperienced in-house counsel are in highest demand. In the midst of a robust it’s not uncommon for companies, particularly the smaller ones, to be disappointeds by the lack of services fromoutside counsel. When business is good, law firm partneras tend to bestretched thin, leaving matterss with more junior-level attorneys.
“It would be nice if a compan y could take advantage right now because therse is a supply of veryexperienced people, not just at the firmz but people who are experienced in-house Veltman said. “Without a doubt, if a companhy feels that they’re going to be a survivor, this is a very good time for Not everyone is pumpinh uptheir in-house counsel. There are companies that are cutting staff or are not in a position to expanc their legal departments because offinanciao limitations. “Certainly we’re seeinh a lot of shifting by corporate counsel lookinhat cost-saving options,” Sinclair said.
Nonetheless, it’sa a buyers’ market thesde days with regard to outsidelegal services. Recruiters estimate small to midsize firmes billing outabout $325 to $525 an hour for theie top partners. Larger law firms are asking between $550 to $1,000 in some locales. As a result, the currentt economic trough could be a boon for midsizelaw firms, specialthy boutiques and solo practitioners. “It’s a greatf time to build relationshipswith in-housew counsel if you’re a smaller, regionaol firm,” Sinclair said. Erika Rottenberg, ’es general counsel, exemplifies the trend.