Legal News

For Employment Law, Pfizer Turns to One Firm: Jackson Lewis

By Ashby Jones

For years, the nation’s biggest companies have been working to winnow their outside counsel rosters. For companies like DuPont and General Electric, using fewer law firms to handle their myriad legal issues has meant fewer logistical headaches and, perhaps more importantly, the ability to drive better deals and cut costs.

Now pharma giant Pfizer, it seems, has taken the notion to a new level, according to this Corporate Counsel article. From the start of the year through the end of 2009, Pfizer will pay law firm Jackson Lewis a capped fee to handle all of its employment work. No billable hours, no per-matter fees; just one sum paid out monthly over the course of the year.

Under the unusual agreement, Jackson Lewis gets any employment-related legal work that comes in the door for the next two years, including single-plaintiff discrimination cases, equal employment opportunity matters, class actions, and general advice and counsel. In return, Jackson Lewis is paid one-twelfth of the annual capped fee each month. The firm sends Pfizer a monthly accounting of the time that it’s spent on Pfizer matters. An end-of-the-year reconciliation will allow Pfizer to recoup any money left on the table.

While the capped fee arrangement for outside legal work appears to be new, Pfizer isn’t the first to give a chunk of its legal work to a single firm. In 2004 Tyco International — one of the early adopters of the single-firm concept — outsourced all of its product liability work to Kansas City’s Shook, Hardy & Bacon, and its corporate matters to New York’s White & Case. And this year, at least two more companies — Honeywell International and Brady Corporation — have picked up on the one-firm idea.

Margaret Madden, the head of the Pfizer’s employment-law group, said the company chose Jackson Lewis, in part, for its willingness to forgo time-based billing. “Jackson Lewis got it because they recognized that we needed to find some alternative to billing by the hour. They actually brought it up before we did.”

Full post as published by Law Blog - WSJ.com on August 19, 2008 (boomark / email).