When Hilton Hotels Corp. needed to fill Glenna Shen's position during the attorney's maternity leave, the Beverly Hills company asked Axiom Legal Solutions Inc. to send a substitute.
That was in 2006, and since then, Hilton continued to use Axiom lawyers not only to temporarily fill some of its in-house legal positions, but also to support the company's legal staff on short-term projects such as merger and acquisition deals.
Up until now, companies have two choices when it comes to hiring outside law firms. They can either hire firms at top dollar to take command of significant issues or they spend far less to contract with temporary legal service agencies for basic support-level work, perhaps for document review.
But Axiom, which firmed up its presence in Los Angeles in November when it opened an office in Century City, is targeting a niche in the middle. It sells itself as charging less than a big-name law firm while still offering well-pedigreed attorneys.
"Axiom is filling a gap that corporations have for either discreet or limited-duration projects," said Shen, vice president and senior counsel at Hilton. "There has never been a good model where you get quality service without paying law firms to do it for you."
Axiom executives said the firm's business model, where attorneys work on-site alongside clients' in-house attorneys, is increasingly in demand by small and large companies because the arrangement offers them high-end legal services at less expensive rates.
"Clients are looking for high-quality lawyers who are there when they need them and go away when they don't," said Mehul Patel, head of global corporate development for Axiom. "They want them integrated and embedded in the business."
In order to provide experienced attorneys to its clients, including AT & T; Inc., NBC Universal Inc. and Yahoo! Inc., Axiom hires attorneys who graduated from top schools, and practiced at elite law firms or large corporations, but who no longer want to work the demanding hours needed to earn big pay.
The pay reduction can be steep. A partner at a top law firm, one who bills upward of $500 per hour, can bring home more than $1 million a year. Other lawyers at the firm may earn less, but those lawyers typically grind out the hours. By comparison, an Axiom attorney who works full time makes an average of $220,000 a year, at a billing rate of $160-$185 per hour. Although the salary depends on how much the attorney works, typically the hours are far more sane.
So, Axiom has a tricky sales pitch to prospective employees: It wants top-quality lawyers who are willing to make far less than top dollar.
Former Gateway Inc. senior attorney Rob Donaldson started working for Axiom three years ago, before the firm established a presence in California. Donaldson, a San Diego-based lawyer, said Axiom caught his attention because it gave him the flexibility to create his own work schedule.
"It is a way for me to do the sophisticated Fortune 500 high-tech legal work," Donaldson said, "but I am not chained to a desk 365 days a year."
The attorneys are employees of Axiom and as such receive full benefits and 401(k) savings plans. Unlike traditional law firms, Axiom doesn't have to support high-paid partners, nor does it need to pay expensive overhead costs because its attorneys work on-site at the clients' offices, or in some cases from home.
Besides the salary issue, there is another tradeoff for the lawyers. Because Axiom attorneys move from one legal project to the next, they can't beef up their resumes with such career milestones as making partner or being named head of a corporation's legal department. Therefore, industry insiders say that Axiom attorneys may find it difficult to transition into a traditional position at a law firm or in-house legal department.
"Executives, as well as general counsels, who are looking to hire want to be able to see not just individual transactions," said Peter Ocko, an L.A.-based legal recruiter with Major Lindsey & Africa LLC, "but they want to be able to comprehensively assess what an attorney's track record has been, and overall accomplishments have been, over a period of time within an organization."
Besides flexible hours, Axiom is touting the variety of work to the lawyers it wants to hire.
"Axiom is for lawyers who want to practice in a different way," Patel said. "They can go to a big company like Hilton, and then spend six months being the general counsel of a small $40 million company."
Whether Axiom's model will thrive is an open question. However, in a down economy, several legal industry experts said Axiom's model makes it appealing to companies that are slashing legal budgets.
"Axiom is attractive to clients because they cut a lot of the middle out of the cost of delivering legal services," said Peter Zeughauser, a Newport Beach-based legal consultant. "And that is going to be much more popular in this economy."
Axiom employs about 250 attorneys, and has offices in San Francisco; Chicago; Washington, D.C.; New York; and London. So far, it has hired 15 lawyers for its new Los Angeles office.
The firm has been working in Los Angeles because some of its media and technology clients, like Google Inc. and Electronic Arts Inc., have offices in the area.
"We have been working in Los Angeles since we launched in San Francisco two years ago," Patel said. "But now we have set up an office, and are targeting clients and attorneys."
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