Last May, Levi Strauss picked Orrick, Herrington & Sutcliffe to handle all of its worldwide legal work except for global intellectual property matters; a month later, the company assigned its IP portfolio to Townsend and Townsend and Crew. Orrick and Townsend (both are headquartered in San Francisco, as is their client) are being paid on a flat fee basis. That means that Levi Strauss is using alternative fee arrangements for 100 percent of its routine outside counsel spending—an extraordinary development for any large company.
Levi Strauss and its firms declined to reveal the dollar value of the deals. Krane says the compensation amounts were “determined by a review of historical spending trends and planned work for 2010.” Levi Strauss, which is privately held by descendants of its namesake, reported net revenue of $4.4 billion in 2008. If its outside counsel spending is in line with the average for other large companies, it would have been paying its law firms somewhere around $11 million. Global finance and governance counsel Jennifer Chaloemtiarana says that the deals with Orrick and Townsend have lowered Levi Strauss’s outside counsel spending by about 20 percent.
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