When Dewey & LeBouef filed for Chapter 11 protection, the firm listed the unsecured creditors, and three of the biggest losers on the list were Thomson Reuters (owed $2.3 million), LexisNexis (owed $1.4 million.), and CCH (owed $650K.)
Although the total amount of legal research to debt is something like 1.7% of the total, it still shows the amount of money that firms pay year in and year out for legal research products. I hadn’t thought about the fact that Westlaw/Lexis/CCH, etc. contracts are unsecured debts before, but I guess there’s not really a lot that Wexis can get from the firms they serve to secure the services they provide.
Does the exposure of this information give us any “insider” information on Dewey’s existing contracts with their legal vendors? Could we make some broad assumptions and say that if we calculate out the remaining amount owed by the number of months left in the year, does this come out to mean that Dewey was paying $3.45 million a year for Westlaw (or roughly $260 per month per lawyer… assuming 1100 lawyers)?? Let’s keep on making these “very assumptive” mathematical calculations:
Lexis — $2.1 million annual – $175 per month per lawyer
CCH — $975,000 – $74 per month per lawyer
In an industry where we are always trying to figure out where we are on our contracts versus our peers, there could be some interesting information coming out in the Dewey bankruptcy. Perhaps those Competitive Intelligence experts could find some even more interesting tidbits.
[NOTE: My friend Don Cruse reminded me that “rest of the year” payments would be avoided in bankruptcy, so my calculations are most likely inaccurate. If Dewey just owes, say the five months of this year, then the totals for subscription costs would jump up about 38% higher than these numbers. Of course, I haven’t seen anything specific, so this is just me applying assumptions to come up with these amounts!! – GL (added @11:47 AM]