United Retirement Plan Consultants, Inc. & Porter Wright
Making Fixed Fees Work in a Small Law Department
Russ Dempsey
Mark Koogler
When Russ Dempsey joined United
Retirement Plan Consultants, Inc., in
2008, it wasn’t his first in-house job, and
he knew what he didn’t know.
“I am a corporate generalist who
had joined a public company,” he says.
“I knew I would need help with the
securities work.”
In the environment of the economic
downturn at the time, Dempsey saw an
opportunity to take the lead on discussions on value-based fee arrangements.
He proposed a shared-risk arrangement
first to the leadership at Porter Wright
Morris & Arthur LLP.
“Porter Wright really welcomed the
conversation with open arms, especially
because we were willing to share the
risk. It enabled us to build a partnership built on trust and collaboration,”
Dempsey says.
The initial agreement was for a
monthly adjustable retainer for routine
securities work; in addition, United
Retirement pays a fixed amount on a
monthly basis for “routine securities
matters.” The law firm and the in-house
department collaboratively defined what
qualifies as “routine securities work.”
The firm tracks hours and submits
shadow bills to help determine the appropriateness of the retainer. If the billable
hours worked on routine securities matters exceeds the fixed-fee amount, then
the company is responsible for 50 percent
of the excess. Similarly, if the billable value of monthly hours worked is less than
the fixed-fee amount, then the company
will be provided a discount of 50 percent
of the amount minus the fixed fee.
For example: The company agrees to
pay the firm $10,000 a month to handle
these routine securities matters. Let’s say
that billable hours in September total
$12,000. United Retirement is responsible for 50 percent of the amount in
excess of the fixed amount of $10,000,
or $1,000. The next month, the billable
value of services provided for securities
matters is $8,000. United Retirement
receives a credit for 50 percent of the
difference, or $1,000.
(CON TINUED ON PAGE 22)
“Porter Wright really
welcomed the conversation
with open arms, especially
because we were willing to
share the risk. It enabled us
to build a partnership built on
trust and collaboration.”
