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General Counsel's office announces restructuring plan

STANFORD -- Three outside legal firms will work with a core of university attorneys to fill Stanford's legal needs in a restructuring of the General Counsel's office announced Tuesday, May 3.

The new system, designed to broaden expertise and provide flexibility while cutting total costs, will be phased in between now and Sept. 1.

"Under this plan, we are drawing upon the expertise of three outstanding firms," said General Counsel Michael Roster, "while keeping a core staff to provide important substantive skills and institutional memory."

The selected firms are:

The university will retain a small core of attorneys to cover academic affairs, as well as general policy and business matters. That core will likely consist of five to seven attorneys, in addition to attorneys at the Stanford Linear Accelerator Center and the Medical Center.

According to Michael Hudnall, deputy general counsel, it probably will take another month or two before the details are fully sorted out. He also noted that Stanford Health Services is being created during the same time period, and that staffing for this new entity may not be finally decided for six months or more.

"The core group will focus primarily on what is unique to a university," Hudnall said. "The areas being outsourced to law firms are ones where it helps to be handling similar matters for other similar clients, or where high levels of expertise on nonacademic issues are especially important."

Roster announced in February that he was considering various options for legal services, including possibly having an outside firm take over everything. Firms also were able to bid on providing specific components, such as tax or environmental-law needs.

Saving money on legal costs was a consideration, he said, but it was equally important to obtain access to broad expertise and to be better able to adapt to fluctuations in university and hospital legal needs.

The university currently spends $7.5 million to $8 million annually for its basic in-house and outside legal services.

Of the firms, Roster noted that McCutchen, Doyle, Brown & Enersen has a strong historic tie to the university. Before the growth of Stanford's in-house staff, the McCutchen firm was, in essence, university general counsel. It has handled university cases raising difficult and unusual issues of academic freedom, student and faculty rights and responsibilities, and other matters of immediate importance to the academic enterprise. In addition, the university, which is one of the largest landowners on the Peninsula, expects to benefit from the firm's real estate, land use and environmental strengths.

Pillsbury Madison & Sutro is the largest firm in the Bay Area, with more than 600 attorneys. The firm already is handling Stanford's important relationships and litigation with the federal government over research costs. That effort is headed by Debra Zumwalt, who will be involved in Stanford's business litigation as well. Zumwalt left Stanford last year to return to the firm as a partner.

Ropes & Gray is a leading firm representing many colleges, universities, hospitals and academic medical centers throughout the United States. It will continue its work helping to form Stanford Health Services and will provide general advice to the Medical Center. The firm also has been doing benefits and tax work for Stanford and will be adding consultation on academic affairs and intellectual property to its coverage.

In addition to the three selected firms, Graham & James of San Francisco, a firm with an international network of offices, has offered to provide basic services relating to Stanford's overseas work on a pro bono basis.

"This was a wonderful offer from a very fine international firm," Roster said. "We are delighted to have their expertise available to us."

All of the firms will have one or more of their attorneys on campus on a regular basis, Roster said. They will work hand in hand with in-house counsel and function as an integrated part of the office, he said.

Roster said that in some cases Stanford's lawyers and paralegals working in a specific area may join one of the law firms. This will provide continuity, while opening new career paths for those Stanford personnel whose positions are being phased out, he said.



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