In-House Counsel – Spring 2015 -- Quiz #2 – Outside Counsel
TOTAL POINTS: 10 points
NAME: ______
READ QUESTIONS CAREFULLY. This is “closed book”; do not use any materials.
Send answers to no later than when time is called.
Question #1 (5 points): You work in a 4-lawyer legal department of a retail company with stores located throughout the U.S. The company’s headquarters office, including the legal department, is located in Iowa. Your company’s stock is publicly traded on the New York Stock Exchange. You work as a generalist, but also have somewhat of an employment law specialty. Your company has just been served with a complaint in California, styled as a class action, alleging that your company has violated state and federal wage and hour laws because it incorrectly classifies store assistant managers as “management” and therefore exempt from overtime regulations. This is the first employment-related lawsuit filed against your company in the past several years and the first ever class action; the company had settled amicably, prior to formal litigation, whatever employment-related disputes and claims it had received previously.
(a) Explain whether or not you would hire outside counsel and why.
(b) Assume you decide to hire outside counsel. Explain:
o How you would choose outside counsel
o All aspects of how you would work with and manage the chosen outside counsel
Question #2 (5 points): You are an in-house lawyer in a 6 person legal department. You were assigned responsibility for a lawsuit filed by a disgruntled former employee. Your company has operations in several states, and this particular lawsuit was filed in California. Your company’s headquarters are in Boston. Your company’s Boston-based outside counsel, with whom you work on other matters, does not have an office in California, but recommended litigation counsel (from a different law firm there), and that’s who you retained. Since you retained that outside counsel, you have been very busy on other matters; employment law is not your particular specialty; and you assumed that not much was going on with the lawsuit because you hadn’t heard from California counsel in a few months. However, you just received the first invoice from the California counsel, and it’s at least 3 times higher than you expected – more, in fact, than you thought you would spend on legal fees for the whole case. From the entries on the invoice, it looks like California counsel has been very busy, researching a variety of legal points, taking multiple depositions, and filing multiple motions in court. Budgets are very tight in your company, and your boss, the general counsel, will not be happy with these high expenses.
What would you do now? What could you have done differently (and when) to help prevent this kind of situation from occurring?