Beyond Biglaw: 5 Tips For Dealing With Billing Guidelines
You want to get paid, and for the client to think you are a great lawyer -- so follow this simple advice, from boutique-firm columnist Gaston Kroub.
One of the things that was most surprising to me as a young Biglaw partner was how little training was given to new partners.
Take “client relations” issues, including how to handle the important initial stages of a new engagement with a large corporate client. There’s surprisingly little training on this topic, even though Biglaw’s raison d’etre is to service such a clientele. Add this omission to the list of important things Biglaw firms neglect to teach their partners. Firms like to tout how attentive they are to the “blocking and tackling” aspects of a strong financial footing; haranguing the partnership on the importance of timely time entries and bill dispatching is a favorite pastime of practice group leaders and managing partners. But at the same time, firms give little to no guidance on the mechanics of sending a bill to a client, or the importance of getting an engagement off on the right foot via communication with in-house counsel who will be managing the case. Instead, it’s all congratulatory pablum for “winning the pitch,” followed by leaving the inexperienced new “relationship partner” to figure things out on their own.
I am not advocating for hand-holding from experienced partners whenever a new partner lands a corporate engagement. Anyone smart enough to make partner, and driven enough to convince a corporate client to give them a chance on an engagement, is capable of handling the relationship (as well as the legal work) competently. But there is always room to provide some guidance to new partners, at least with respect to important, but easy to overlook, aspects of representing a sophisticated corporate client. An easy example is billing guidelines.
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I don’t know when billing guidelines came into vogue, but they definitely existed when I started working on pitches in the 2005-2006 timeframe, and brought in my first large corporate client as a new partner in 2009. And they remain important today. Every new corporate engagement that we have had at our firm has seen the client send over the billing guidelines — right after they sent back the signed engagement letter. To be clear, such guidelines are separate from the engagement letter that we have agreed to with the client. They are the general rules that the corporate legal department has set up for all their outside counsel. The guidelines are important, since there is an expectation that your firm will follow them. Failure to do so will make your firm look bad, even if your legal work is otherwise up to par. Losing clients over “side issues” such as failing to adhere to billing guidelines is not good for firms — especially when you consider how difficult it is to bring in the client in the first place.
Training new partners on how to deal with billing guidelines is easy. It could be done in an hour maximum, over a lunchtime presentation. The presenter just needs to show the audience a few client examples from the firm’s archives, add an anecdote or two about some horror stories to keep everyone awake, and provide some simple tips for avoiding a similar bad result. If it saves the firm from one embarrassing client interaction, it would be well worth it.
Here are five tips for consideration:
1) If you receive a signed engagement letter, and there are no billing guidelines sent along at the same time, ask your in-house contact if his department has any. You will look sophisticated, and attentive to making sure you handle the new relationship properly.
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2) When you get the billing guidelines, read them carefully. Make a note of anything that looks confusing, or maybe does not apply to your engagement. Repeat this process until you are sure that you know what the client’s billing rules are. Make sure that your fellow timekeepers on the engagement are aware of the guidelines as well.
3) Think about your engagement. Are there any issues that are worth addressing with your client upfront? For example, many billing guidelines have generic rules regarding travel. But if you are New York counsel for an East Texas patent case, you may need to discuss travel budgeting and ground rules in greater detail. Make a list of any such issues.
4) The time to clear up any ambiguities with the guidelines is at the start of the engagement. Send a succinct email to, or set up a brief call with, your in-house contact to discuss any questions you may have — especially if you feel your engagement may require some deviation from the ground rules. The foreign client who wants you to travel coach domestically may be willing to subsidize business class travel when you need to visit corporate headquarters. Find that out before you book the expensive ticket, or suffer needlessly on a trans-Atlantic flight next to two greasy backpackers. Sometimes, your in-house contact will have department-specific ground rules that are not reflected in the document you received. Get that information as early in the engagement as possible.
5) Hire Mark Herrmann’s son if you have to, but make sure your bills are sent on time, and follow the client’s preferred format. Clients will not pay your bills otherwise. It is that simple. As an added bonus, you will earn the client’s mistrust of your ability to handle the legal aspects of the engagement properly when your bills are not up to par. You want to get paid, and for the client to think you are a great lawyer. Make sure the bills are sent at the right time, in the right format.
There are few moments in a legal career as rewarding as bringing aboard a new “brand name” client. Yes, anytime you land a new client it is exciting — even if that client is a family member hiring you to file a trademark application, for a grand billable total of $1500 or so. Getting new clients is hard, and even minor achievements on that front deserve to be celebrated in some measure. But as your career progresses, the time will come where you will be expected to add to the firm’s revenue pool. It does not matter if you are at a Biglaw firm or a boutique. Ultimately, your career ceiling will be determined by your ability to bring on — and keep — new clients. Follow the guidelines.
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Please feel free to send comments or questions to me at [email protected] or via Twitter: @gkroub. Any topic suggestions or thoughts are most welcome.
Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique. The firm’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at [email protected] or follow him on Twitter: @gkroub.