Avoiding Getting Caught Up in a Law Firm’s Protocols – II

In my last post entitled Avoiding Getting Caught Up in a Law Firm’s Protocols, I discussed how getting caught up in a law firm’s protocols on approaching even the smallest of matters often leads to overbilling and more importantly, overlooking any real opportunities to quickly and efficiently resolve a matter for a client.

To avoid getting caught up in a law firm’s standard protocols on how they approach most all legal matters, I ended my prior post with three important steps to take. In this post I will discuss each one of those steps.

Agreement on the Objective

Before even approaching a lawyer to take on a matter, a client needs to as narrowly as possible focus in on what is the objective of the representation. This may sound sound simple enough to do. But I have seen individuals and even corporate clients approach a lawyer with a laundry list of things they want done that reads more like the “tactics” or the specific steps they want the lawyer to take rather than the “objective.”

Assuming you do have a very definite idea of what you want done or what should be the objective of the representation, then according to ABA Model Rules of Prof. Conduct (RPC) 1.2(a), the lawyer is then bound to “abide by the client’s decision concerning the objectives of the representation.” However, note that does not necessarily mean that the lawyer has to take on the representation – especially if what the client wants done (i.e., the objective) is unreasonable, illegal, unfeasible, or unethical or he just plain doesn’t want to take on the representation.

Agreement on Steps to be Taken

After agreeing on the objective of the representation, the next step to take is to agree on what is going to be done to successfully meet the objective.

Ordinarily, lawyers view deciding on a plan of action or the tactics or the means to take to meet the objective as something that they should decide. But RPC 1.2 provides that lawyers should “consult with the client as to the means by which “they are going to “carry out the representation” and should “defer to the client regarding such questions as to the expense to be incurred.” Thus, the client should have a definite say in the means especially as they relate to expense.

Note that more often than not, there may be different ways to successfully meet a client’s objective in a matter. And a good attorney will let the client know what all the options that may be available to meet the objective – especially those options that may involve less time and less cost. In fact, an attorney has an ethical obligation to do this. See ABA Annotated Model Rules of Professional Conduct (6th ed. 2007) at p. 63 “Duty to Explain Law and Benefits and Risks of Alternative Courses of Action”. If your lawyer forgets to discharge this mandatory ethical duty, you should be prepared to ask about all alternative courses of action (and get the lawyer’s answer on this point in writing).

Whatever is finally agree upon should be set out in a written plan of action that the lawyer intends to employ to follow to meet the client’s objective. The plan should not only set out what is going to be done and when, but also who is going to do what. This latter point ties in with the third step a client needs to take, getting agreement on the staff to be used.

Agreement on Staff to Be Used

After setting out the objective and the means to achieve the objective, the next step is to agree upon what staff will be used. And if it is not possible to identify specific firm staff members who will work on the matter, it is important to at least identify the level of law firm staff that will do the work.

Except in very small law firms, a law firm staff usually consists of partners, associates, paralegals, and non-billing legal assistants or secretaries. And since associates charge less than partners and paralegals charge less than associates and legal assistants or secretaries do not charge at all, it is important when going over the agreed to plan of action to drive work down to lower billing or non-billing staff wherever possible. For example, if subpoenas are to be sent out, they should be prepared and sent out by paralegals. Or if a large amount of documents need to be reviewed, this should be done by lower billing associates (or even paralegals). Even minor court hearings can be handled by lower billing associates. The point is to go over each step in the plan of action and get agreement on what level of staff is going to be utilized with an eye toward driving down the work wherever possible to lower billing or even non-billing staff..

Changing What Was Agreed To

Finally, it should be noted that as a legal matter unfolds, the plan of action may need to be changed. Sometimes it may be that even the objective(s) need to be changed. If so, rather than abandoning completely what was previously agreed to, this process to get to agreement on a revised plan of action will need to be repeated.

The above is not to say that there are many other things that can be done to save on costs as well as help ensure a favorable outcome sooner rather than later to avoid getting caught up in a law firm’s protocols. But the most important things that can be done are those things that are done up front. These things include agreeing upon the objective of the representation, agreement on the steps to be taken to achieve the objective, and agreeing on the staff to be utilized.

How to Avoid Getting Caught Up in a Law Firm’s Protocol

Some time ago, I had a doctor come to me for help sorting out a large legal bill he had incurred with a large law firm.  He had a Medicare billing problem and had gotten into some trouble with the feds.  Although he incurred several hundred thousand in legal fees from this law firm, the firm did little to resolve his Medicare billing problems.  So the cardiologist went to an attorney at a small firm who was able to quickly and satisfactorily the Medicare billing issues.  The total bill from the new attorney at the small firm was less than $10,000.

Continue reading

A Good Tip to Save on Legal Costs & Get Better Results

Here’s a tip for small to mid-sized insurers that will not only save on legal costs, but will lead to improved indemnity results as well. I say it’s a tip for small to mid-sized insurers because it’s a tip about something that large insurers already know. And the tip is to use coordinating counsel to oversee or coordinate like or similar litigation that occurs in different jurisdictions.

Coordinating counsel are often used by larger insurers to coordinate product liability cases in which the a manufacturer’s product has led to numerous suits on the same issues in different jurisdictions.  Of course, most small to mid-sized insurers do not ordinarily insure large manufacturers. But they do get sued for coverage (some on a more frequent basis than do larger insurers!). So whether it is product liability cases or coverage cases or just about any other types of cases that are similar, but occurring in different jurisdictions, consideration should be given to hiring coordinating counsel.

[For a complete copy of this blog post, contact clientservices@legalbillaudit.com]

Why Use of “Blended Rates” May Actually Increase Legal Costs

For the non-business readers of this blog, “blended rates” are negotiated rates with a law firm that involve blending or averaging partner and associate hourly billing rates of a law firm.  Insurance companies are big users of blended rates.

The way blended rats work is simple. If the partner’s hourly rate is $400 an hour and the associate’s hourly rate is $300, a blended rate might be $350. But whether you can save by using blended rates in a particular case actually will depend on the type of case.  For example, if the case is complex and heavy partner involvement is anticipated, you can save on legal costs. Continue reading

COVID-19 Insurance Coverage Update

In a prior post, I predicted that “if history is any guide, policyholders may win most of the coverage cases” for COVID-19 related claims. I stated that my “prediction is based on the insurance industry’s experience in litigating various policy issues for environmental claims coverage 30 years ago.”

Apparently, I was prescient in my likening the COVID coverage claims wars to the environmental coverage claims wars. For in reading news accounts, it appears that policyholder coverage attorneys are doing their best to link COIV-19 claims to environmental claims by likening COVID-19 clean-up or property damage claims to pollution clean-up or property damage claims or COVID-19 exposure claims to exposures to asbestos fibers or exposure to toxic vapors or fumes. Continue reading

Whether a $1,000 an Hour for a Lawyer is Reasonable Depends on Whether You Need a Cadillac Escalade or a Honda Civic

“[T]he Court’s review of Sheppard Mullin’s bills suggests that the Beastie Boys opted to pay for, and received, the Cadillac Escalade, not the Honda Civic.” Beastie Boys v. Monster Energy Co., 112 F. Supp. 3d 31  (Dist. Court, SD New York 2015).

A D.C. lawyer recently asked me if I thought $1,000 an hour for a lawyer was reasonable. Being a lawyer myself, I gave him a lawyerly answer that “it depends.”

I’ve written posts before in this blog about $1,000 and even $2,000 an hour lawyers.  As I stated in one of those prior posts, an “expert” who consults on litigation management issues with corporations (who are the ones who mainly hire the $1,000 and $2,000 an hour lawyers) told me that lower rates are actually viewed as a negative by large corporations. Apparently very good $500 an hour lawyers are not looked at in the same favorable way that mediocre $1,000 lawyers are simply based upon their hourly billing rates. Continue reading

Why Insureds May Win COVID-19 Claims Coverage Cases.

Media reports are that many businesses and non-profits are looking to their insurers for “business interruption” and other coverages due to the COVID-19 pandemic. At first blush, it would appear that these claims for coverage face an uphill battle based upon what might be termed clear policy language (specially manuscripted policies notwithstanding).

But it would be premature for the insurance industry to declare victory on the coverage issues. For if history is any guide, policyholders may win most of the coverage cases.

Mr prediction is based on the insurance industry’s experience in litigating various policy issues for environmental claims coverage 30 years ago. As a former Director of Environmental Claim for two insurers during the environmental claims coverage wars, I witnessed first hand how clear and otherwise unambiguous policy language did not save the insurance industry by and large from having to provide coverage for environmental claims and their massive clean-up costs. Continue reading

It’s Deja Vu All Over Again As COVID-19 Presents Law Firms With Same Financial Issues Faced During The Great Recession

With almost daily report of law firm layoffs and/or reductions in compensation, it looks like the COVIS-19 pandemic is going to have the same effect on the financial health of the legal industry as did the Great Recession in 2007-2009.  And if what happened in the Great Recession is any indicator, law firm clients will need to scrutinize more closely their legal bills.

One reason for closer scrutiny is because of what happened in the Great Recession with regards to staffing cuts. In the Great Recession, the support staff rather than attorneys bore the brunt of law firm cutbacks. This was because law firms were reluctant to let go of the attorney talent they worked so hard to attract and invested so much to develop. So the only other place to turn for savings in a labor intensive business is to support staff.

As I have blogged about before, cutting back support staff and increasing the ratio of attorneys to support staff will save law firms money. But, it also almost invariably means increased costs for law firm clients. Continue reading

How To Discuss Fee Bill Issues With Your Lawyer – Part IV: The Nuclear Option

[This is the fourth and final post in a series of posts on how to discuss and resolve fee bill disputes with your lawyer. If you have not done so already, it is a good idea to read the first three posts in this series.]

Invariably, whenever I write a post about a lawyer getting disciplined for an ethics violation involving fee billing, I will get emails. Mostly from individuals with comments or questions about lawyer discipline. And so it was that after my post about an lawyer who got a six month suspension for overbilling, I received emails from individuals with questions on the disciplinary process for lawyers.

Some of the most frequent questions I am asked are how to go about filing a complaint (and if a lawyer is needed to file the complaint), will the disciplinary agency get my money back or get my lawyer to answer my questions (or do whatever it is they want the lawyer to do), and can my lawyer retaliate against me (or file a suit against me for slander) if my complaint is dismissed? So with this the fourth and final post in this series, I would like to answer these questions and share the basics of filing a disciplinary complaint against a lawyer. Continue reading

How To Discuss Fee Bill Issues With Your Lawyer – Part III

[This is the third post in a series on how to discuss fee bill disputes with your lawyer. If you have not done so already, it is a good idea to read the first two posts in this series as they detail steps that should be taken before getting to the point where the additional steps outlined in the post should be considered.]

In my last post in this series, I ended with the assumption that communications with your lawyer and/or the firm’s managing partner or other partners in the firm failed to resolve the billing issues.  In this post I will discuss what additional steps may be taken to resolve the billing issues once direct communication has not worked or has broken down. Continue reading