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Company loses millions in dispute with litigation portfolio outsourcer

Case reminds in-house counsel to scrutinize all contracts

Unocal Corp.’s lawyers had good intentions. But after losing millions of dollars in a recent lawsuit, they may have learned the true gravity of ensuring due diligence when it comes to contracts.

In late 2003, the oil and gas company’s in-house legal team was seeking creative ways to cut costs in the legal department. One of the company’s biggest legal expenses—with regard to both money and time—was environmental litigation. At the time, an average Unocal environmental case took three years to resolve, cost $500,000 in legal fees and typically settled for $1 million or more.

Breaking Up

In August 2005, Chevron Corp. acquired Unocal for approximately $18 billion. Soon after, Unocal terminated its contract with Howrey.

Ashley Post

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