The law department as profit center?
Bloomberg reports that this group at DuPont was responsible for $290 million in revenue last year,which included a $92 million asbestos insurance settlement.
According to the article:
The asbestos agreement in December 2006 resulted from a three-year-old DuPont program to find ways to generate revenue by filing lawsuits the company would not otherwise have initiated or by seeking licenses from companies using its patents. The law department has brought in $630 million since 2004, according to DuPont assistant general counsel Thomas Sager.
Dupont is integrating alternative fee arrangements into cost recovery activities:
The firms that handled last year’s insurance settlement, Pittsburgh-based Kirkpatrick & Lockhart Preston Gates Ellis and Beaumont, Texas-based MehaffyWeber, reduced or waived their hourly rates and shared about $15 million of the settlement.
Big settlements can skew results a bit, but it’s an important discipline for a law department. It’s perhaps an even more important signal to send to the CEO and the board.