Billable Hours

Have you ever heard of a “chief value officer”? Let’s assume your answer is “no,” because you don’t spend your free time reading synergistic white papers produced by McKinsey & Co. But that’s something the good people at Drinker Biddle would like to change. The Legal Intelligencer reports that Drinker Biddle is creating a new position to help the firm focus on client value:

If in a push for efficiency law firms are changing the way they offer their services, it’s only logical that how they market those services needs to change as well.

That’s a concept not lost on Drinker Biddle & Reath, which, after scaling back what it calls its client relations department over the last four years, is ready to grow it in a different way after widely restructuring the department’s functions.

The restructuring is highlighted by the appointment of Chicago-based Kristin Sudholz as the firm’s first-ever chief value officer.

You gotta ask yourself: What kind of economy are we living in where a professional services firm needs to create an executive position to make sure clients receive value for the services they purchase? It’s almost like a automobile manufacturer needing to create a “chief driving officer” to oversee consumers’ ability to actually drive the product.

The thing is, I’m almost positive GM does have an executive in charge of “drivability” or something. So maybe this Drinker Biddle idea isn’t totally off the wall…

double red triangle arrows Continue reading “Drinker Biddle’s Latest Attack on the Billable Hour”

Nixon Peabody was a winner in Signature Flight Support Corp. v. Landow Aviation, a dispute between two aviation companies at the Washington Dulles airport. Nixon landed a victory for Signature Flight, and filed a motion for Landow to pay attorneys’ fees in the case.

Landow thought Nixon’s fees were sky-high and opposed the motion, resulting in a review of Nixon’s bills by Judge James Cacheris (E.D. Va.). Judge Cacheris buzzed Nixon’s bills. From the National Law Journal:

U.S. District Judge James Cacheris of the Eastern District of Virginia determined that Nixon Peabody’s $1.57 million in fees was too high and slashed about $440,000 off that amount, awarding $1.13 million….

In his July 30 decision, Cacheris found that the number of hours Nixon Peabody expended on the case demonstrated a “lack of billing judgment exercised by plaintiff’s counsel” and “overall excessiveness of plaintiff’s fee request.”

Less than half a million slashed? Pocket change — though that was on top of $205,102.50 that Nixon says it had already excluded from the bill.

Reading the opinion offers lots of fun Skaddenfreude, perhaps particularly for attorneys laid off by Nixon Peabody early last year. Partner Louis Dolan got knocked by the court for spending hundreds of billable hours at the end of 2008 doing work better suited for a junior associate…

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Welcome to the next in our series on the results of the 2010 ATL/Career Center Associate Satisfaction survey. We’ve used the survey results to revamp the Career Center, powered by Lateral Link, with completely updated profiles. Each week, we are highlighting insider information that Members shared about their firms in the eight key areas of associate satisfaction covered by the Career Center.

Today, we look at how your firm and others measure up in one very important aspect: Billable Hours.

  • This Texas-based firm, with one of the world’s leading energy practices, does not have a billable hours requirement, although bonus amounts are contingent upon meeting certain hours thresholds.
  • While this "top-notch" New York-based firm has no official billable hours requirement, Lateral Link Members report that the unofficial expectation is between 2,100 and 2,400 hours. 
  • This California-based firm, which focuses on intellectual property, has an unusual billing system based on "billed, not billable, hours," and although the billable minimum is only 1,700 hours, hours "recorded but not billed out to the client are disregarded." 
  • First-year associates at this East Coast firm are required to bill 1,900 hours per year, while other associates are required to bill 1,950 hours, a requirement that Members concur is “attainable and reasonable.”

More highlights — check to see if your firm is featured — after the jump.

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Start her up. People are always telling laid off or unemployed lawyer to “hang out a shingle” and start their own firm. They say this like it is comparatively easy for young lawyers to just go out there and drum up enough business to support themselves. It’s not, but some people are at least trying.

Today, the Washington Post profiles (gavel bang: ABA Journal) a group of lawyers that aren’t just trying to start their own firm, they’re also trying to kill the billable hour while they do it:

When clients call Washington attorney Sue Wang, the clock doesn’t start ticking.

Phone calls aren’t billed in six-minute intervals and each hour of work won’t cost several hundred dollars.

Wang and the four other lawyers in Clarity Law Group aim to reconfigure the billable-hour business model at law firms that she said tends to shut out small and start-up companies with shallow pockets.

Yeah, yeah, nobody likes the billable hour — Clarity Law Group purportedly has a “timeshare” business model. Does this mean that potential clients will get a free meal while the lawyers lock them in a room and try to sell themselves?

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In April and May of this year, the Altman Weil consulting firm surveyed the leaders of 787 law firms with 50 or more lawyers about the state of the legal industry. After receiving responses from 218 of them (a 28% response rate), Altman Weil crunched the data and compiled it in a big law firm survey, which it published earlier this week.

The survey came out a few days ago and has been covered extensively in various legal news outlets. But we weren’t in any great rush to write about it, since it doesn’t contain much to get excited about: many of the findings are (1) gloomy and (2) unsurprising.

To turn the Nixon Peabody theme song on its head, these days it seems that “everyone’s a loser” in the world of Biglaw….

double red triangle arrows Continue reading “Law Firm Survey Confirms All the Depressing Stuff You Already Knew About the Business of Biglaw”

Earlier this week, we ran an open thread how people are doing on their hours. We also had a survey asking people to tell us how many hours they are on track for. We received strong reader participation in the poll, but there was a flaw in the survey. According to commenters:

elie. you need to leave an option to “view results” w/o checking. Law students and others will be interested in this, but will have to choose a selection to view results….

Well, I assumed that law students would just wait until the today’s follow up post since I clearly stated I would do one:

I just checked the category that includes 0 hours to view the results, so the stats are skewed. FAIL!!!

Have you ever heard of a little thing called patience? Can we please act like adults?

0

In house.

GOD. Fine. I screwed up. Sorry for expecting readers to exhibit a modicum of restraint and not click on a poll to which they didn’t have an answer.

With the caveat that the numbers for the “less than 1600″ category are skewed by people who couldn’t wait two days for the follow up, the results of the survey appear below…

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We’re nearing the mid-way point of 2010. By popular demand, it’s time to check in on how people are doing for billable hours. We mentioned yesterday that in-house counsel are not looking to raise the billables of outside counsel, so we wanted to take the temperature of the community.

We did this survey last year in August. At the time, a majority of you said that you were on track to bill less than 2,000 hours.

Luckily, that was a snapshot of the sad and pathetic 2009. We are now well into the awesome and great 2010. RECOVERY SECURE … right?

So how are you doing on hours this year? Take the survey below and share you thoughts in the comments. We’ll do a follow up later this week on how you and your peers are doing.

Here’s hoping many of you are on track for that 1,900 – 2,100 hour sweet spot. We don’t want you to burn out, or get fired…

double red triangle arrows Continue reading “The Hours Open Thread: How Are Your 2010 Billables?”

It’s June 1st. Summer is upon us! Yay.

So how are you doing for hours? As much as we talk about merit-based compensation and alternative fee arrangements — surprise — billable hours are still here and still very, very important.

But if in-house attorneys have anything to say about it, your hours will be low this year…

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I’d rather not get into it. You’d fall off your chair.

– Leading First Amendment lawyer Floyd Abrams, declining to discuss with the New York Times what he and Cahill Gordon are charging the ratings agency S.& P.

I wrote a letter for a client that saved the client $4 million. It took me about five hours. I thought $25,000 was a reasonable fee. The client’s response was: How many hours did it take?

– A law firm partner posing a question to the speakers at a recent panel discussion on law firm/client relationships.

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