In-House Counsel

An analysis of the gatekeeping independence of inside and outside counsel

By Rees Morrison

How well do inside lawyers stand up to misconduct by their clients? Do partners at firms gatekeep more effectively? That is the topic of a column in ACC Docket, Vol. 26, Nov. 2008 at 22, where Ron Pol distills the framework used by an academic to answer the questions. The academic?s article is Sung Hui Kim, ?Gatekeepers Inside Out,? 21 Geo. J. Legal Ethics 411 ( 2008).

Kim?s analysis involves a 2-by-2 quadrant and each of us can assess which lawyer a quadrant favors. One involves ?willingness to monitor? potential wrong-doing, which inside lawyers probably do better because they are avoiding future work by probing into a possible problem before it festers. Another quadrant, which goes to ?capacity to monitor,? strongly favors in-house counsel because they have much easier access to people and facts that inform them about the possible problem.

?Capacity to interdict/prevent? is harder; once a potential problem is spotted and researched, which lawyer can stop it better? Of course, it depends. Everything always depends, but I give a bit of an edge to outside counsel, who can run a problem up the food chain with fewer concerns about internal politics and appearances. The fourth quadrant is ?willingness to interdict/prevent.? I give an strong edge to the partner, because putting your job on the line to blow the whistle on a powerful executive deters you much more than the risk a partner faces of losing part of her legal fees in the future.

The call is, therefore, a close one, and the sound response is Pol?s: inside and outside lawyers should complement each other in the ferreting out, exposure and prevention of wrongdoing (See my post of May 3, 2006: whistle-blowing, police role of in-house counsel.).

Full post as published by Law Department Management on December 27, 2008 (boomark / email).