Legal Business

Two new faces gain membership to reshaped Co-op legal panel

Posted on |
In-house Co-operative Legal Services

Seven firms have won spots on a revamped Co-op Group legal panel which sees its corporate, commercial and property panels combined to work alongside primary adviser Allen & Overy (A&O).

Newly-appointed firms Fieldfisher and Squire Patton Boggs join Addleshaw Goddard, Pinsent Masons, Hill Dickinson, Brodies and Paris Smith for a three-year term, following a review which began last year.

The group’s head of legal operations, Helen Lowe, and head of legal and digital Peter Horsfall, led the review with procurement manager Peter McHugh. TLT and Weightmans had both previously held panel spots with the group.

A Co-op spokesperson said: ‘Following an extensive panel review, the Co-op has appointed seven law firms with a wide range of specialist knowledge and legal expertise in the areas of commercial, litigation, property and corporate matters to support its in-house legal team. They join A&O, the incumbent City firm.’

The group has five core businesses in the food, electrical, insurance, funeral care and legal services sectors, spread across 3,750 outlets. It began reviewing its panels last year around the time former Dixons Carphone group general counsel (GC) Helen Grantham replaced Alistair Asher in the top legal role. Asher, a former A&O partner, moved into a new role as director of special projects for the business.

Asher first got involved with the Co-op in spring 2013, when he was drafted in to help with the bank’s £1.5bn capital shortfall.

hamish.mcnicol@legalbusiness.co.uk

Legal Business

Co-op Group kicks off panel review as former Dixons Carphone GC takes top legal role

Posted on |
In-house Co-operative Legal Services

The Co-operative Group has begun reviewing its corporate and commercial legal panels, as well as its property law and litigation advisers, as the former Dixons Carphone group general counsel (GC) Helen Grantham replaced Alistair Asher in the group’s top legal role.

Grantham took up the new GC role last week, having joined the British consumer member-owned group as interim group secretary in January 2016. Asher will continue in a new role as Co-op director of special projects for the business.

The new panels are expected to be in place by January 2018 and will be led by Helen Lowe, the group’s head of in-house legal operations and Peter Horsfall, head of legal and digital.

Addleshaw Goddard, TLT, Pinsent Masons and the group’s primary adviser Allen & Overy (A&O) are currently the main corporate and commercial advisers for Co-op, while Pinsents, Brodies, Weightmans, Hill Dickinson and Southern English firm Paris Smith are on the existing property panel.

Asher, who was previously a partner at A&O, first got involved with the Co-op in spring 2013, when he was drafted in to help with the bank’s £1.5bn capital shortfall.

Most of Asher’s role at the Co-op revolved around saving the bank from collapse and working on a new strategy for the organisation going forward.

As Legal Business previously reported, Asher and head of legal Jim Tully lead an assessment into the British consumer group’s panel firms as the group’s legal team underwent a reorganisation.

Last year it was reported that the Co-op Bank’s legal risk expenditure almost doubled in 2015, mostly to address issues caused by the mis-selling of payment protection insurance.

The group’s banking arm’s conduct and legal risk costs shot up 91% from £101.2m in 2014 to £193.7m over the last year, which according to the bank, related to ‘legacy issues’.

The Co-operative Group in involved in sectors from food and electrical retail, legal, financial and insurance services, to funeralcare, spread across 4,200 locations.

As the largest consumer co-operative in the UK, it is owned by in excess of 4 million members.

kathryn.mccann@legalease.co.uk

Legal Business

A 30% drop: Co-op Legal Services sees revenue slide by £10m

Posted on |
Financial results 2014 Co-operative Legal Services
legal-business-default

Co-operative Group Legal Services (CLS) has seen its revenue decline by almost a third to £23m in 2014 from £33m in 2013 due to a drop in ‘personal injury income following regulatory changes to referral fees’.

According to the Co-operative Group’s 2014 full year results, its CLS business made an underlying operating loss of £5m in 2014, though that was down from £9m the previous year despite the diminished revenues.

The group did say the service had turned a small profit in the second half of the year following a restructuring, but that it still needed to ‘clearly define the future’ of the offering.

A statement published in its annual report today (9 April) said: ‘We believe that the legal services market remains fragmented, and many member and customer needs are not being effectively met. We are now looking to better define our approach to this market, as we build the business as part of the overall Group Rebuild programme.’

Revenue at Co-op Legal Services, which launched with great acclaim in 2009, slipped 28% from £18m to £13m last year over a 26-week period to 5 July. The fall in sales of probate and family law services pushed up the division’s losses, which stood at £3m for the corresponding period in 2013.

CLS, which is run out of Bristol, was one of the first businesses to receive alternative business structure (ABS) licence but was hit by the loss of Christina Blacklaws, who spearheaded its development, when she left to launch an ABS consultancy in 2014.

Meanwhile, in January Legal Business revealed that the Co-op’s general counsel Alistair Asher and head of legal Jim Tully are set to lead an assessment into the group’s panel firms as the 40-strong legal team undergoes an internal reorganisation. Understood not to be a formal review, the Co-op has worked closely with a wide range of firms including Allen & Overy, Addleshaw Goddard, Burges Salmon and Weightmans.

sarah.downey@legalease.co.uk

Legal Business

Schadenfreude alert on High Street as Co-op’s legal services division slumps to £5.1m loss

Posted on |
ABS Co-operative Legal Services
legal-business-default

The Co-operative group’s push into high street legal services continues to falter, with the unit making a £5.1m loss for the 26 weeks to 5 July.

Revenue at Co-op Legal Services, which launched with great acclaim in 2009 trumpeting expectations that the business would employ 3,000 people, slipped 28% from £18m to £13m for the period. The fall in sales of probate and family law services pushed up the division’s losses, which stood at £3m for the corresponding period last year.

The company said in its financial results: ‘In the last six months we have been focused on addressing the underlying issues, reducing the cost base, and restructuring the business to ensure it is the right size and shape for the future. This restructuring has now been successfully completed, and we have a clear plan for the second half of the year, in which we expect a positive contribution from Legal Services as we move into 2015.’

‘Legal Services will work closely with the other business within the new consumer services division [which also includes insurance  and  funeralcare] to explore new ways of providing services and products which meet customers’ needs at key life stages.’

Co-operative Legal Services, which is run out of Bristol, was one of the first businesses to receive permission to an alternative business structure and was hit by the loss of Christina Blacklaws, who spearheaded its development, when she left to launch an ABS consultancy earlier this year.

Despite a multi-million-pound advertising campaign last year, the ABS continues to struggle, with management last year putting its poor performance down to regulatory change and legal reforms that hit its personal injury business and led to a restructure.

tom.moore@legalease.co.uk

Legal Business

‘Slower than expected growth’ sees Co-operative Legal Services unveil £22m operating loss with flat turnover

Posted on |
Financial results 2014 Co-operative Legal Services
legal-business-default

Co-operative Legal Services (CLS) has made an operating loss of £22m for 2013 and unveiled a flat turnover, blaming a slower than expected growth rate for the period and factors including a hit to its personal injury business stemming from the Jackson Reforms.

Revenue at 560-employee CLS, which operates from three sites, came in flat at £33m, the Co-operative Group announced in its annual report today (17 April), as it also highlighted plans for CLS to work more closely with other limbs of its diverse business.

The operating loss of £22m, compared to £2m in 2012, came after a ‘goodwill impairment’ of £13m ‘following a reassessment of its business plan, which has assumed a slower growth rate than previously applied’, the report said.

The business review and results for the 52 weeks ended 4 January 2014 said the CLS business ‘remains in the early stages of its development, and this is reflected in the performance for 2013. Sales were broadly flat with losses arising from regulatory change.’

It attributed the losses to ‘uncertainty about the future of our general insurance business, and decisions to invest in future growth.’

The report continued: ‘We are now looking to consolidate and optimise the portfolio, with further restructuring planned, to work more closely with Funeralcare and General Insurance as part of the newly formed consumer services division.

‘Regulatory change, including the Jackson reforms, had the most significant impact upon our personal injury business. The restructuring of the PI business announced at the end of 2013 has been completed in line with our plans.

‘However, following the decision not to sell the general insurance business we are now able to explore opportunities to work more closely with our insurance business.’

The Co-op’s family law business achieved £1.2m revenue in its first full year of trading after a period of investment in developing a transparent fixed-fee pricing proposition.

The results come as the group today unveiled £2.5bn losses for 2013, the worst results in its 150-year history.

francesca.fanshawe@legalease.co.uk

Legal Business

ABS growing pains: Co-op Legal Service’s losses simply teething troubles, says GC

Posted on |
ABS Co-operative Legal Services
legal-business-default

With news that Co-operative Legal Services (CLS) has posted a £3.4m loss in the for first half of 2013, the group’s recently installed general counsel Alistair Asher says the business is still in its infancy and will flourish, provided it has the appropriate levels of investment. The loss comes despite turnover in the Co-op’s legal arm growing by 5.8% on last year to £18.1m.

GC to the board of The Co-operative Group, Asher said: ‘The top line is growing so the bottom line will improve. CLS is still a start-up business so it is not a case of turning anything around, it’s actually about developing the business and moving forward. CLS is one of the biggest business opportunities for The Co-operative Group right now. We have got the business model we need, we just need to give it support and investment so it can grow.’

CLS was the first major consumer brand to be granted ABS status under the Legal Services Act in March last year. Since then, the total number of licensed bodies has grown to 184, according to the Solicitors Regulation Authority (SRA).

CLS has invested heavily in trying to build a consumer focused ABS brand and recently invested in a multi-million pound TV and radio advertising campaign in June and is currently planning further investments into IT, the details of which are still being confirmed.

Nevertheless, the results contrast with last year’s figures, when CLS posted a small profit of £700,000, although Asher noted that the 2013 loss so far this year are small in comparison with the level of investment made into the business.

One partner at a City law firm said: ‘CLS has invested a lot into consolidating and building a business – its premises in Bristol are huge. The £3.4m loss doesn’t raise any questions about ABS – I don’t expect the business will see profit until 3-5 years into its business plan – but it does raise questions about Co-op’s banking group.’

CLS’ loss is miniscule in comparison with The Co-operative Group’s £559m pre-tax deficit reported in July, incurred mostly in its banking arm. In response, the Prudential Regulation Authority instructed Co-op Bank to make good a £1.5bn capital shortfall, £1bn of which is expected to come from its bondholders.

‘The losses announced on the bank are a result of the impairments to the corporate real estate globally and some residential loan books,’ said Asher. ‘The underlying core banking business is perfectly sound. We have seven million customers and this banking business will be the product of the restructuring over the next few years and this is very complementary with CLS.’

jaishree.kalia@legalease.co.uk

Legal Business

In-house Round-up: Swiss Re GC to DAC, Co-op’s Gulliford to Pannone, FACT appoints first GC and Auction.com takes on senior legal team

Posted on |
In-house Co-operative Legal ServicesDAC BeachcroftPannone Corporate
legal-business-default

If it had seemed that the flow of UK hires between private practice and in-house was very much one-sided in the corporates’ favour a recent run of high profile moves has gone some way to evening out the score.

Co-operative Legal Services (CLS) co-founder Jonathan Gulliford has joined Pannone Affinity as a consultant as part of an ongoing growth drive at the Manchester firm’s white label legal arm.

The legal division, which was launched in 2011 by Pannone to capitalise on opportunities presented by the Legal Services Act, provides commoditised services to a range of clients including insurers Allianz and Aria.

Gulliford joined the Co-op from RAC Legal Services in 2006 and was one of the founders of the household name’s legal division. In 2012 CLS became the first SRA regulated alternative business structure (ABS), recording a total revenue of £33m in 2011/12.

Gulliford said of his recent move: ‘With so many opportunities in the legal market post LSA and LASPO the potential for growth is huge.’

The first week of this month also saw Swiss Re corporate and prudential regulation lawyer Adrian Williams (pictured) join DAC Beachcroft’s London office from the reinsurance company’s headquarters in Zurich.

Prior to Swiss Re, Williams was head of legal at QBE European Operations in London, where he established the inaugural in-house legal team. Head of insurance at DAC, David Pollitt, said: ‘Our insurance clients have been telling us for some time that they want their panel firms to be able to service their needs from a corporate/commercial advisory perspective as well as from a claims perspective. We have responded to this client demand with the recruitment of Adrian.’

Williams added: ‘A lot of law firms I was coming across as a GC weren’t getting their service right even now. I’ve always really admired the successful partners in my field and I’ve been looking for an opportunity to apply what I’d learnt as a GC and to build something that was as successful but had my own slant on it.’

The moves come after the FT’s high profile GC Tim Bratton this month joined Berwin Leighton Paisner’s flexible staffing operation Lawyers on Demand as its first practice development director.

Elsewhere, a number of interesting moves between corporates have also been announced this month including The Federation Against Copyright Theft’s (Fact) appointment of former Group Lotus IP lawyer Byron Jacobson as its first permanent GC.

To date FACT has relied on external advisers, including Wiggin, Russell-Cooke and Belfast’s Edwards & Co and has taken on secondees, including Wiggin IP litigation partner Neil Parkes, who was acting GC for six months from 2011 to early 2012 while still an associate.

Prior to Lotus, dual US-UK qualified Jacobson was at Bristol-based drinks group Allied Domecq, having moved to the UK from specialist IP firm Nelson & Roediger in Phoenix, Arizona, and before that Dorsey & Whitney’s Denver office.

Jacobson has not yet been replaced in the legal team at Lotus, which is managed by head of legal services Karen Bloodworth.

In the US, meanwhile, online real estate marketplace Auction.com has reunited a senior legal team, all formerly together at Yahoo! with former GC Michael Callahan named as Auction.com’s executive vice president, chief legal officer and company secretary.

Mindy Heppberger and Eugene Lao, who while they worked at Yahoo! were vice president and deputy GC, have joined Auction.com in those roles. Lao joins most recently from a stint at US social gaming company Zygna having left Yahoo! in 2011. Callahan, meanwhile, resigned from Yahoo! last summer.

While at Yahoo!, Callahan built a legal, public policy, ethics and compliance, and IP department, which grew threefold to 200 under his leadership. He acted as key advisor to the executive team and board of directors through acquisitions, investments and divestitures including the strategic investment and restructuring of Yahoo!’s holdings in the Alibaba Group.

francesca.fanshawe@legalease.co.uk