Billable Hours

The fact that the billing rates of contract attorneys are in excess of what the law firm pays them is not unusual or untoward. That’s to cover overhead and have a profit built in.

Ira Press, a partner at Kirby McInerney, offering commentary on the Citigroup billing frackas that’s made headlines of late. On average, the firm billed out contract attorneys who worked on the matter at about $465 an hour, but likely paid them just $60 to $75 an hour for their “special expertise” and services. Ted Frank, aka the Class Action Avenger, is not happy about all of this.

[Think of hourly fees] as the equivalent of a sticker on the car at a dealership. It’s the beginning of a negotiation…. Law firms think they are setting the rates, but clients are the ones determining what they’re going to pay.

Ward Bower, a principal at the legal consultancy Altman Weil, commenting on the ever-growing price tag for the Biglaw billable hour — and the deep discounts that are available to clients who simply refuse to pay full freight.

If you follow the world of large law firms, then you are probably familiar with the incisive and candid commentary of Steven J. Harper. Over at his blog, The Belly of the Beast, Harper offers excellent insights into the world of Biglaw.

Harper knows so much about that world because he spent his entire legal career in it. He joined Kirkland & Ellis after graduating from Harvard Law School in 1979. He practiced litigation at the firm for about 30 years, until his retirement in 2008, at the early age of 54 (which you can afford to do when you’re an equity partner at a firm as lucrative as K&E).

In addition to blogging, Harper has written four books. I spoke last week with Harper about his latest book, The Lawyer Bubble: A Profession in Crisis (affiliate link), and about his views on the worlds of Biglaw and legal education….

double red triangle arrows Continue reading “An Interview with Steven Harper, Former Kirkland Partner and Author of ‘The Lawyer Bubble’”


* Can you DIG it?! Well, SCOTUS can’t, at least when it comes to the Prop 8 case, but perhaps that’s what the conservative justices planned all along. You can probably expect a judicial punt on this one. [New York Times]

* The case for cameras at the high court became even more compelling last week, because people just now realized that having to “spend money to see a public institution do public business is offensive.” Damn straight. [National Law Journal]

* Justice Sandra Day O’Connor’s new book, Out of Order (affiliate link), didn’t exactly get a glowing review from the NYT’s Supreme Court correspondent, Adam Liptak. It’s a “gift shop bauble”? Ouch. [New York Times]

* Oh, Lanny Breuer, you tried to be all coy by saying you were interviewing elsewhere, but we knew you’d return to Covington. That “vice-chairman” title is a pretty sweet new perk, too. [Legal Times]

* DLA Piper’s bills may “know no limits,” but in-house counsel claim that while the firm’s emails were “flippant,” they won’t have an impact their already meticulous billing review. [New York Law Journal]

* The true love’s kiss of litigation: Bingham McCutchen’s Sleeping Beauty may have found her prince in Judge Vincent O’Neill Jr., because he ruled that the firm won’t be able to compel arbitration. [Recorder]

* It’s really not a good time to be a prosecutor in Texas. Two months after the murder of ADA Mark Hasse, DA Mike McLelland and his wife were gunned down in their home. RIP. [Dallas Morning News]

* Good news, everyone! The class of 2012 — the largest on record, according to the ABA — was only slightly more unemployed than its predecessors. Cherish the little things, people. [National Law Journal]

My personal favorite: Peepemptory Challenges.

* To those of you who celebrate it, Happy Easter! Welcome the holiday by voting in the ABA Journal’s fifth annual “Peeps in Law” contest. [ABA Journal]

* If law firm brackets aren’t your thing, check out Professor Kyle Graham’s brackets for (1) law school classes and (2) law blogs. I’m thankful for ATL’s #1 seed but terrified by who we’re up against (because they’ve ripped me a new one before). [noncuratlex]

* Sorry, Judge Steiner, you wuz robbed; you should have been our Judge of the Day. It’s tough to top “allegations of a sexual quid pro quo with a female lawyer and the eye-opening confiscation of carpet from [chambers] for forensic analysis.” [OC Weekly]

William Shatner

* “William Shatner’s Seductive Powers Don’t Create a Fiduciary Duty.” Robyn Hagan Cain explains why. [U.S. Second Circuit / FindLaw]

* Citi settles securities cases for $730 million. Matt Levine is not impressed. [Dealbreaker]

* And Ted Frank is incensed by Bernstein Litowitz’s nine-figure fee request. [Point of Law]

* If you’re already depressed by public ignorance about the Supreme Court, don’t look at the responses to question 9 of this opinion poll. [Penn Schoen Berland]

* Steven Harper — author of a new (and very good) book about the legal profession, The Lawyer Bubble (affiliate link) — offers thoughts on the billable hour in the wake of the DLA Piper overbilling allegations. [New York Times]

First, some random thoughts on the legal news of the week:

1) Who gives two ***** if gay folks get married? Or have the same rights as you and me? My goodness, if two people want to get married, God Bless them! And it is a civil rights issue; being told that you can’t have information on your partner’s hospital stay because of HIPAA is downright medieval. The pastor whose YouTube speech went viral after reading from anti-desegregation literature and turning it into an anti-gay marriage diatribe was probably the most brilliant argument in defense of gay marriage. Twenty years from now we’ll be saying: “Gay marriage? Meh, it’s really those damned ______ that we have to watch out for…” Hey, it’s America, **** yeah!!, every group gets a turn at being the downtrodden.

2) Don’t get me started on North Dakota’s draconian steps with regard to a woman’s right to choose what to do with her own body. Now see, it’s Holy Week and I probably can’t take communion.

3) This DLA Piper billing debacle? Makes me sick, and is a perfect segue into finishing my column from last week. I know I know, DLA came out and said, “Heh heh, we were just kidding. Those guys aren’t even around here anymore. Overbilling? Meh. Never happened, we promise.” What did you expect them to say?

I happen to know personally one of those mentioned in the story, and he was just as much a dim bulb back then, so it is no surprise that he wrote that stuff in an email. That he moved on to a partnership at another firm is no surprise either. I will say that he is infamous for leaving one of the funniest and most outrageous drunk emails voicemails on a colleague’s phone early one morning. And he probably can’t figure out who he is from this blind item in any event. But, I digress, back to overbilling…

double red triangle arrows Continue reading “House Rules The Rates Are Too Damned High! (Part Two)”

‘Churn that bill, baby? Dear Lord…’

* With SCOTUS justices questioning standing in the Prop 8 case, and one even stating that gay marriage is newer than cell phones and the internet, you can guess where the decision is headed. [New York Times]

* “This badge of inequality must be extinguished.” With men like Ted Olson and David Boies representing the plaintiffs in Prop 8, at least we can say that they fought the good fight. [Wall Street Journal (sub. req.)]

* OMG, remember when DLA Piper allegedly overbilled a client and got dragged through the mud over scandalous emails? Now the firm says they were totally joking. So cray. [DealBook / New York Times]

* Less than a month after handing out pink slips across multiple offices, Patton Boggs named a new managing partner in New York who just so happens to be a Dewey defector. Ominous. [Am Law Daily]

* These are great tips on negotiating financial aid, but try this: tell admissions you’ll happily enroll elsewhere, and watch them throw cash at you. [Law Admissions Lowdown / U.S. News & World Report]

* It looks like Paul Ceglia’s zany misadventures in being fired as a client by Biglaw firms and suing Facebook may finally be at an end thanks this scathing 155-page recommendation of dismissal. [CNET]

Opening a legal bill from DLA Piper?

Here at Above the Law, we ❤ DLA Piper. The firm makes for great copy; there’s always something funny, ridiculous, or salacious going down over there.

In fairness to DLA Piper, the craziness might not be that high on a per capita basis. DLA Piper is one of the largest law firms in the world. In the most recent Global 100 rankings, DLA took second place in both total revenue and attorney headcount.

Many of the DLA Piper stories are on the lighter side. But this latest one — involving serious allegations of overbilling, apparently supported by internal DLA emails saying things like “churn that bill, baby!” — is no laughing matter….

double red triangle arrows Continue reading “Overbilling Gone Wild: Paying the (DLA) Piper”

Previously, we brought you an important flowchart about when you are allowed to leave work from Rob Complains About Things. Rob’s a former Biglaw associate who now artfully describes his prior experiences.

Today, Rob is back with the accurate billable hour breakdown that clients aren’t allowed to see….

double red triangle arrows Continue reading “The Biglaw Pie Chart That Tells You Where All The Hours Went”

‘I’m excited because I can see my lawyer hasn’t slept in three days!’

Let the micromanagement begin! Clients always complained about bills, but over the last several years, clients elevated their complaints to outright micromanagement, objecting to “block billing” and refusing to pay for internal team meetings, even on massive projects.

I’ve said before that this billing regime saps lawyers of valuable efficiency. Not that lawyers are perfect, but constantly stopping to parse out billing for every individual task creates a bigger waste.

Now clients have a new technological tool to intrude upon the workday….

double red triangle arrows Continue reading “Do You Want to Micromanage Your Lawyers? There’s an App for That!”

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