Tyco’s Europe advisers next to face the axe in panel weed-out

After emerging from crippling debts and a very public accounting scandal, Tyco has launched a searing review of its global legal advisers, with European law firms next in line to face the spotlight.

So far, the manufacturing conglomerate has taken an axe to its US legal advisers. From a line-up of 25 law firms Tyco used for corporate advice, only two remain – White & Case as primary adviser with Foley & Lardner providing backup.

The most swingeing cuts have hit Tyco’s litigation lawyers. When the company began the review, it turned to 750 law firms for litigation in the US, and was using 300 for product liability litigation alone. Now Tyco has appointed just one, Shook Hardy & Bacon, which will operate on a fixed-fee arrangement with performance bonuses.

The dramatic reduction of litigation law firms has been overseen by Jim Michalowicz, who was recruited from DuPont as litigation programme manager in January 2004 to assist deputy general counsel/litigation Gardner Courson with the process.

In IP, adviser numbers have dropped from 50 US firms to three, led by Chicago’s Bartlit Beck Herman Palenchar & Scott.

Tyco is using a process based on the ‘Six Sigma’ quality improvement methodology, which was pioneered by Motorola and General Electric to improve a company’s operational performance by identifying and eliminating defects in manufacturing and service-related processes.

Tyco’s deputy general counsel/corporate Tim Flanigan headed the corporate firm review.

Flanigan and Courson, both recruited by Tyco general counsel William Lytton in late 2002, have now turned their attention to their international law firms, with the latter visiting London recently to discuss with his in-house team how to streamline the firms used in Europe.

Flanigan has conducted consultations in Asia, with Latin America and Australasia to follow.