Abstract

Outside Counsel Guidelines (“OCGs”), terms of the lawyer–client relationship imposed by corporations, are a significant development in the practice of law by large corporate law firms (“BigLaw”). Among the most controversial OCGs are those that expand on law firms’ fiduciary obligations, thereby restricting their future clientele. The organized bar maintains that rules of professional conduct should restrict lawyers’ acquiescence to these OCGs because they limit clients’ access to legal services and undermine lawyers’ independence without advancing corporate clients’ legitimate interests.

This Article shows why the bar’s effort has (very recently) deservedly failed: corporate clients have a legitimate interest in demanding greater loyalty than the rules provide as well as in expanding on other fiduciary protections, and the bar’s avowed concerns about clients’ choice of counsel and lawyers’ autonomy are not significantly implicated in this context.

At the same time, the Article shows that the bar has other good cause for concern. It argues that by treating BigLaw firms as service providers rather than trusted professionals, OCGs contribute to corporate lawyers’ loss of influence and standing as wise counselors, and to the corresponding decline of their traditional commitment to promoting the public good through their legal work. This analysis contradicts the conventional understanding of how corporate law practice is evolving. The traditional pendulum account states that power and standing swing internally within the corporate hemisphere, historically from general counsel to BigLaw and now back to in-house counsel. Our revisionist account shows that power has shifted from the corporate bar to corporate clients.

The account we develop explains for the first time seemingly contradictory contemporary-practice realities in the corporate hemisphere of the legal profession that others have struggled to understand. If BigLaw firms have lost power, how have they remained so profitable? And if they have not lost power, why have many firms capitulated to the Trump Administration?

We show that in response to their loss of power in the twenty-first century, BigLaw firms have restructured. This restructuring has successfully mitigated BigLaw’s loss of power and allowed the firms to remain profitable. But law firms’ restructuring further weakened their commitment to practicing corporate law as a public calling and promoting the public spirit of the law and the rule of law. This helps explain why, at the start of the second Trump Administration, highly profitable law firms declined to oppose Executive Orders targeting the legal profession. 

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