Lawyers in the Board Room

At a company meeting several years back, the CEO of Reebok ranted about his aversion to lawyers, then turned to his general counsel and said, “Not you, Jack, you don’t count.”  What the CEO meant was: “You’re one of us, Jack.” As in-house counsel you’re essentially “living with the client, ” a vantage point necessary to keep your company on track and circumvent potential problems.

In-house lawyers know their corporation inside and out — its priorities and its challenges. The scope of the work is broad, involving not only basic legal tasks, but also proactive risk management and a heavy dose of business acumen. Contracts, intellectual property, labor and employment, litigation, tax, antitrust, privacy issues and many other areas are all in a day’s work.

Walter Energy Inc., a leading producer and exporter of metallurgical coal for the global steel industry, is among Alabama’s publicly traded companies with lawyers on staff. The Birmingham-based company produced 11.7 million metric tons of coal with sales of $2.4 billion in 2012. As counsel for Walter Energy, Mitchell Mataya works with two other senior attorneys in Birmingham and two others in the Vancouver office, focusing on litigation and environmental issues.

Mataya’s range of responsibilities includes real estate transactions, contracts, merger and acquisition work, contract disputes, software licenses and other agreements and working with the company’s risk management department.

The scope of an in-house attorney’s work is much broader than at a law firm, says Mataya. “I have to be prepared to deal with any number of issues that arise on a daily basis that range from month-long projects involving multiple departments to quick agreements that require immediate action, ” he says.

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“Monotony is not an issue I will ever have to deal with.”

Outside counsel is brought in when projects delve into areas requiring specialization, mainly for litigation, environmental and transactional issues involving construction and software licensing. “As much as I would like to claim expertise in my numerous areas of responsibility, without the assistance of outside counsel, I would be putting Walter Energy at risk.”

David Woodruff, general counsel of Energen.

Armed with both a law degree and an MBA, Mataya first worked in private practice before working in-house. He left a Tuscaloosa law firm to join a small oil and gas exploration company and then landed his position at Walter Energy. “The idea of working for one client and becoming part of a team and being a decision maker was very intriguing, as opposed to the ‘hired gun’ label that private practice lends itself to.”

In-house counsel also wears multiple hats at Energen, an oil and gas exploration and production company headquartered in Birmingham that also distributes natural gas through Alagasco, Alabama’s largest gas utility. David Woodruff, general counsel for Energen and its subsidiaries, says the legal department’s numerous roles include the management of in-house and outside legal services, corporate secretary and governance

support to its board of directors and certain compliance oversight duties.

“In many respects (our legal department) is similar to a small general practice law firm, ” Woodruff says. “We deal with a broad array of legal issues and have developed specific areas of expertise applicable to our company’s business.”

Woodruff has been with Energen in various capacities since 1986. Before joining Energen, he was an associate of Bradley Arant Rose & White (now Bradley Arant Boult Cummings).

Stephen Yoder, general counsel at AmSouth Bancorporation and AmSouth Bank from 1995 to 2004 before it merged with Regions, says inside legal departments have grown dramatically in the last 30 years. “The primary advantage is having someone who understands the company deeply and completely, and it’s usually more economical, since it’s not uncommon for lawyers to charge $500 an hour, ” explains Yoder, who is now assistant professor at University of Alabama’s School of Business and counsel at Balch & Bingham LLP in Birmingham.

The primary advantage of having in-house counsel “is having someone who understands the company deeply and completely, ” says Stephen Yoder, formerly in-house counsel for AmSouth, now with University of Alabama and Balch & Bingham LLP.

Yoder says another reason to have in-house counsel is the current emphasis on risk management. “Congress thought the latest economic meltdown was due to risk management, and lawyers are key to this risk management mindset. The more highly regulated the company, such as banks, public utilities and healthcare, the greater the need for in-house counsel.”

Compensation has increased as the job becomes increasingly complex. According to Robert Half Legal’s 2013 legal salary guide, in-house attorneys with one to 10 years’ experience saw an increase in salary of about 3 percent. In-house attorneys with 10 to 12 years of experience had the highest projected increase, at nearly 4 percent. And some obtain top-level positions at corporations.

Before becoming CEO of Birmingham-based Protective Life Corp., John Johns was general counsel for Sonat Inc., an energy holding company also headquartered in Birmingham before it was acquired by Houston-based El Paso Energy Corp. in 1999.

The Washington D.C.-based Association of Corporate Counsel, the in-house bar association for corporate counsel who practice in legal departments worldwide, was founded on raising the prestige for the position. Jim Merklinger, vice president and general counsel for ACC, says the notion used to be that in-house work was for those who could not get a job at a law firm.

“Now the question asked is, ‘How do I get a job as in-house counsel?’ Our surveys show that, while there’s a high level of scrutiny working as in-house counsel, there’s also a high level of career satisfaction. The role of in-house counsel is changing from manager to trusted advisor involved in the strategic planning of the organization.”

According to ACC membership surveys:

  • 81% are satisfied with their work.
  • 34% are highly satisfied.
  • 78% want to participate in corporate issues and in the overall decision-making process.
  • 34% work in companies with less than $100 million in revenue.
  • 63% percent earn $200, 000 or more a year.
  • 5% earn $1 million or more a year.
  • 57% work more than 50 hours a week.

It’s likely that Jeff Lisenby logs more than 50 hours a week as head of the corporate legal department at Birmingham-based ProAssurance, the fourth largest writer of medical professional liability insurance in America. As general counsel, Lisenby leads the legal/compliance department, which consists of seven attorneys.

Jeff Lisenby, head of the corporate legal department at ProAssurance.

Insurance is a heavily regulated industry, he notes, and regulation occurs at the state rather than federal level. ProAssurance does business in nearly every state, so regulatory compliance in each of those jurisdictions is time consuming and a primary focus of the legal staff.

“Aside from the regulatory compliance piece, our legal department functions much like a small law firm with a single client, ” Lisenby explains. “The business people call on our attorneys whenever there are issues. We handle as many of those matters as we can in-house, and we engage outside counsel to assist when special expertise is required or when we’re defending litigation directly against the company.” Outside counsel is also brought in to represent ProAssurance in lawsuits around the country, to advise on SEC and public company issues, and assist with mergers and acquisitions.

While many in-house attorneys began their professional life working for law firms, some started out in a completely different field. Lisenby taught eighth and ninth grade English in the early 1990s in Massachusetts. He returned to Alabama in 1992 to attend law school and worked in private practice for six years before joining ProAssurance. He was a litigator with no background in professional liability or insurance when a friend told him about an in-house counsel opening at ProAssurance.

“Fortunately, I was offered the job, and it’s one of the best things that has ever happened to me. The opportunity to handle a full range of legal matters for a single client has been consistently interesting, challenging and fulfilling, and the people I work with here are second to none.”

Jessica Armstrong is a freelance writer for Business Alabama. She lives in Auburn.

Text by Jessica Armstrong

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