Legal ops was key to bringing down mass tort costs at a multinational industrial company years before legal ops was a known field, says the executive who helped build the technology for that company’s legal team.
A decade ago, Ingersoll Rand was wrestling with more than $100 million a year in legal costs tied to asbestos-related mass tort liability, so it brought in a deputy general counsel to lower those costs, Mike Russell, head of global legal ops at Expedia Group, said in an Elevate podcast.
Russell said he joined Ingersoll Rand at the time to help bring technology solutions to the in-house legal department.
“They had basically been throwing money at the problem,” said Russell, who has played a legal ops role since 2000, when he was the strategic legal technologist for Liberty Mutual.
The company was working with an outside firm that functioned as a national coordinating counsel for the thousands of lawsuits it was managing each year.
“They get a ... check every year to make the cases go away,” Russell said. “That was the traditional model.”
The new deputy GC grew the company’s internal legal staff and in-sourced some of the work the outside counsel had been doing.
“The idea was, most of the decisions about how these cases were being handled needed better attention,” he said. “We wanted to settle what needed to be settled and take to court what needed to go to court, and there was this large bucket in between that we felt [created] a lot of leakage and an opportunity to save.”
By working with alternative legal service providers and other resources, the in-house team was able to manage a lot of the work that the outside firm was doing, including discovery, which at the time included a lot of paper discovery.
“We actually needed boots on the ground to go out to plants or factories to look in file rooms and take a look at documents that nobody really knew if they were relevant to the matters, but somebody had to make that determination,” Russell said.
Virtual law firm
The technology infrastructure he helped build enabled the in-house team to create what Russell called a virtual law firm that included a national trial counsel, a national discovery counsel and dozens of local attorneys across the country to provide the boots-on-the ground legal work.
“All these processes could be connected with a legal ops driven process,” he said. “Systems and technologies would keep track of all the moving parts and, of course, all the invoices and billing that goes on in the background.”
Out of that process, he said, came a way to standardize how the attorneys handled deposition taking and other functions.
“We introduced a number of technology platforms around just managing matters, depending on how things would flow through the system,” he said.
To get everyone on board, the team created training on each of the platforms.
Because the initiative was driven by the company leadership, the process for getting the in-house attorneys to use the platforms went relatively smoothly.
“It was really the outside counsel we had to get to [work under the system],” he said. “They had to turn their practice on its side and think, ‘Well, we’re now part of this large virtual network.’”
Complicating the work was the differences in types of cases, because “we had multiple entities involved, multiple product lines,” he said. “It was quite complicated.”
In addition to the training, the in-house team hosted annual meetings with everyone involved so participants could put faces to names.
“It was more than just people on the other end of an email,” he said. “Over time, I think they started to work really well together.”
By the time Russell left in 2020 to join Expedia, Ingersoll Rand was saving millions of dollars a year on the lawsuits.
“Before the new leadership and before the process was put in place, the spend was well in excess of $100 million,” he said. “We brought that down to well below $100 million over the years, so that made a significant dent in the overall spend.”
A part of the effort on the technology side, the team established metrics to measure how well they were doing. It wasn’t as simple as identifying the money saved; it went beyond that to help leadership use the metrics as decision-making tools.
“It took a while to establish metrics for people to understand how we would know the classic, ‘What does good look like?’ other than reducing outside counsel spend,” he said. “When was something abnormal? Are we on track, off track? Are we red or are we green, and if we were red, what does that mean?”
Among the trends they looked for were spikes in incoming cases, spikes in deposition costs and whether they were overrunning the discovery work.
The metrics challenge has made him a big advocate of visual management so decision makers can see at a glance on their dashboard what next steps are needed.
“If not in real time, at least week over week,” Russell said. “And then you’re able to actually understand what’s happening.”
If the company sees a certain kind of case in a certain jurisdiction being handled by a certain law firm, for example, that could trigger a different response than if the specifics are different.
With that kind of visibility, he said, “you can probably predict what’s going to happen with the next one that comes in the door,” he said, “and I think that really helped our in-house attorneys make decisions around what was the low hanging fruit we could settle and get rid of and not expend any legal fees where it didn’t make sense to do that.”
That freed up resources for those once-a-year cases that needed special attention, he said.
“Then you would use those resources wisely,” he said.