[throwawaylinux]

Makes sense, thank you.

It would be interesting to know how big and litigious a technology company would have to get before it made sense to develop their own litigation capability. Or would that run afoul of some legal profession expectation that "prestigious firms" are required, no matter the size of the tech company?

[unavoidable]

There isn't really a professional expectation about prestigious firms. However, there is some reputational effect of having external counsel represent you in court. Some courts (judges, juries) might view a lawyer who represents a variety of clients more credibly than a lawyer who is directly employed by one corporate party (admittedly I think this is a very small effect and can work both ways).

Most companies also want to maintain a healthy separation between internal and external counsel so that they can keep certain kinds of communications privileged and avoid awkward situations where an attorney who is both an employee and legal advisor to a company might be subpoenaed for a deposition (basically any time a lawsuit happens, any corporate employee with knowledge can potentially become subject to deposition as a fact witness). You basically never want your in-court lawyer to be deposed for any reason.

That said, there are some companies who look into this kind of stuff for smaller matters - small corporate disputes, collections of accounts receivables, and whatnot - oftentimes are now being done in-house even if they involve some in-court matters. It still doesn't seem to make sense for big files though.

[andylynch]

I struggle to think of a firm better matching that description than Oracle. But slightly more seriously, this kind of litigation work is both very specialised and high risk, so it makes sense to rely on the best advisors in the field, who will almost certainly be external counsel.