I’ve known some lawyers to proudly proclaim that in litigation, they leave no stone unturned. They boast that they will pursue every defense, review every document, and raise every argument. In doing so, presumably, they assure victory. They strive to win at any cost.
This approach makes sense when a well-funded client faces bet-the-company litigation. In that case, of course, a lawyer should pursue every possible path to victory, even if a particular path seems like a long shot. It may cost a lot to win, but even more to lose. In these cases, the economic interest of the attorney and the client are aligned. If the amount at stake warrants it, the lawyer can work the case to the max, and the client is happy to pay for it.
But smaller firms handling smaller matters know that many times, winning in litigation is relative to the amount at stake and the fees incurred. Every client is initially delighted to receive a favorable verdict at trial. But when the heat cools down, and only the bill remains, even the winning client may resent his lawyer when he reflects on the price he paid for his “victory”….
Over the last few years, the legal market has changed dramatically. We live in a buyer’s market in which the clients hold the upper hand and can demand financial concessions from their attorneys that go beyond lower hourly rates.
This good news for clients might sound like bad news for lawyers. If lawyers can’t charge as much, they likely won’t make as much. But although greater price competition might lower revenue for some firms, it surely presents an opportunity for others. Small law firms often compete with bigger firms on price, and increased client sensitivity to legal fees can be a marketing boon to firms that can undercut their competition (with the familiar caveat, of course, that the smaller firm must be able to provide the resources and quality required by the particular matter).
The changing market invites, if not demands, lawyers to offer concessions for clients. Happily, many of the concessions have relatively little impact on the firm’s bottom line, but can garner significant goodwill with clients. For example….
* Two weeks from today, the Supreme Court will be hearing oral arguments on the Obamacare case. Everyone thinks Justice Kennedy’s vote will swing the Court, but Chief Justice Roberts isn’t about to let him steal his sunshine. [New York Times]
* Gaming post-graduation employment statistics: the Columbia Law School and NYU Law edition. It looks like it might be time to fire up the Strauss/Anziska machine for the top tier of our nation’s law schools. [New York Post]
* But speaking of Alston & Bird, some Floridians are complaining about the firm’s bill. $475 an hour for four partners and associates? You really need to stop, because you’re getting the deal of the century. [The Ledger]
Ah, nothing brings around the lawyers of today like the talk of money. One of the most popular Google searches by law students and lawyers is “how to make money as a lawyer.” I rarely see searches for “how to cross examine the expert witness,” or “building a reputation, one case at a time.”
It’s all about the cash.
So here it is, here’s your red meat:
Charging “what everyone else charges” is for losers.
Good clients know you get what you pay for. Cheap, annoying, time-sucking, Bar-complaint-filing clients try to own someone for nothing. If you want the same clients everyone else has, charge the same legal fees. You can be Wal-Mart, or you can be Saks. More people shop at Wal-Mart, but people looking for quality shop at Saks, and they know the difference. They go in, they see something they want, and pay for it (without a payment plan). (And don’t tell me “credit cards are payment plans.” The seller gets the full amount, the buyer makes payments to the bank.) Saks doesn’t have “low prices,” and customers aren’t going there for low prices. They’re looking for quality. Price is secondary….
* Paul Ceglia didn’t want to pay Facebook’s Biglaw bill for 177 hours of legal work, so the judge slashed the price to $75,776. At just $428 an hour, how will these lawyers feed their families? [Los Angeles Times]
* Extra frothy: Santorum’s trifecta of wins in Minnesota, Colorado, and Missouri has made Mitt Romney angry. Because even a guy who wins nonbinding primaries can be dangerous to a man’s campaign. [New York Times]
* Joe Amendola claims that evidence is being withheld in his client’s case — evidence like the alleged victims’ phone numbers. Why does Sandusky need those? So he can call and breathe heavily into the phone? [Philadelpha Inquirer]
* Foxy Knoxy’s lawyer is appealing her slander conviction in Italy, claiming that the police “manipulated” her during questioning. You were already cleared of a murder charge, stop pushing your luck. [USA Today]
* It’s really too bad that Lindsay Lohan doesn’t employ Biglaw firms for all of her drama, because given what she’s spent on legal fees in recent years, those prized spring bonuses would assured. [Huffington Post]
* Florida: a place where people don’t care about your income tax returns. Mitt Romney dominated the state’s primary, grabbing all 50 of the delegates needed for the Republican nomination. [New York Times]
* Entry-level hiring might be down, but lateral hiring is being approached like an NFL draft. Biglaw firms want the best of the best, and if they have to poach partners to get what they want, they will. [Wall Street Journal]
* Paul Ceglia was ordered to pay Facebook’s legal fees, and now he’s crying over Gibson Dunn’s Biglaw price tag. Instead, he wants to pay podunk fees for his podunk town. [Bloomberg]
* Some cities in New Jersey don’t like pollution — they want to keep the trash down the shore. Hoboken’s mayor has denied MTV’s film permit request for Snooki and J-WOWW’s spinoff show. [New York Post]
Here’s a puzzle for you. What decade am I discussing in the following paragraphs?
I’m doing something a little different here. The entire text of this column appears before the jump. I’ve hidden only the citations after the jump. Ponder while you read these paragraphs when the source materials supporting these words were written:
The excessive cost of legal services is not a function of the economy that will abate as the recession finally fades. In the words of one recent report, “Don’t fool yourselves that when the recession passes things will return to normal.” That report quoted the general counsel of a major financial institution as saying, “The way we are now is the way it is now, not a temporary situation . . . . [I]n the [decade omitted] we’re going to see straight hourly billing die.”
Surveys confirm the concerns about the high cost of legal services. For example, in a [year omitted] general counsel survey conducted by [the firm you know as PriceWaterhouseCoopers], a majority of the 350 respondents agreed that “legal fees have gotten out of control and are crippling businesses,” and pressure to reduce costs was a “major theme” of the survey responses. Surveys of corporate law departments conducted by Endispute, Inc. in [two years omitted] reveal that a third of the respondents faced actual cuts in their legal budgets and that, as the size of the legal departments increased, so too did the pressure to reduce legal costs. A [year omitted] Louis Harris survey of executives and legal officers of Fortune 500 service corporations reveals cost containment as a top priority for law departments, and a survey of major corporate clients in the United Kingdom demonstrates that this is now a worldwide issue.
The pressure to move away from standard billing, based on the billable hour, is likely to increase. Indeed, [name omitted], the recently appointed general counsel of [company name omitted], is leading an intense campaign to adopt alternative billing mechanisms. Her efforts have been broadly publicized and resulted in a highly visible panel at the [year omitted] ABA meeting.
In what years did these things occur? What decade are we discussing? And who the heck was the recently appointed general counsel of what company? Those citations and more after the jump….
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In a land that is right here and in a time that is right now, a technology has arisen so powerful that it can replace basic human document review. Is it time to bow down before our new robot overlords?
First, here’s a little story about me: my life in the legal world began as a paralegal. My first case was a GIANT patent infringement case that was already six years old and had involved as many as five companies, multiple US courts, the ITC and an international standards committee. I knew nothing about any of this.
On my first day, my supervisor (a paralegal with at least eight other cases driving her crazy) sat me down in front of a Concordance database with a 100,000+ patents and patent file histories. “Code these,” she said. I learned that “coding”, for the purposes of this exercise, meant manually typing the inventor’s name, the title of the patent, the assignee, the file date, and other objective data for each document. I worked on that project – and only that project – for at least the first six months of my job. After a week or so, time began to blur.
What I know, in retrospect and with absolutely certainty, is that as time began to blur, so did my judgment. So did my attention to detail. If you could tell me that I did not make at least one mistake a day – one inconsistent spelling, one reversed day and month, one incorrectly spaced title – I frankly would need to see your evidence. I would not believe it. The human mind is trainable but it is not a machine.
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