The Billable Hour as a Driveway Moment
November 25, 2008 | Filed Under Cost Control
We’ve seen the Billable Hour conundrum in legal publications for decades, returning like a boomerang that we thought finally escaped our grasp.
Then a few months ago you find the Billable Hour appearing in the business press. Hmmm, interesting.
But when Mrs. Wired GC hears it on the radio last Friday, it means (a) things are changing or (b) an extremely slow news day at NPR. I, for one, would have driven into a ditch.
The four minute audio is available here.
There are some excellent sound bites, including a sort of point-counterpoint between Nicole Auerbach from Valorem Law Group and Pamela Rothenberg from Womble Carlyle.
Paraphrasing, for the Flash media player-impaired:
>>Ms. Auerbach:
In forming Valorem, clients told us the #1 issue for them was cost control, knowing what legal matters will cost on the front end.
>>Ms. Rothenberg:
It’s not in the realm of possibility that the Billable Hour will just go away; you’d have to have a tsunami of change for every firm to throw it out. The important thing to focus on is what clients need.
There’s truth in both statements, but if I were scoring this round I’d say advantage Auerbach. Although if one of Womble’s clients wants to go off the hourly reservation, I assume they’d oblige.
I think there’s always been a problem of definitions in the Billable Hour debate. Here are two key ones for me:
– (a) “Billable Hour” is a regime, characterized by most attorneys charging by the hour, with no alternative control mechanisms save for the individual lawyer’s sense of ethics and the relationship partner’s sense of reasonableness.
– (b) “Hourly Billing” is simple math, a way of calculating time on a matter and can in fact be part of many alternative fee arrangements, just not the default end result.
So even if (a) sinks under its own weight, (b) will likely always sail on, sailor.
But I’d have someone on lookout for that tsunami, just in case. It could be a sign of regime change.
Paul Lippe, Legal OnRamp - Wired GC Seminar
November 13, 2008 | Filed Under Seminars
The Wired GC continues its seminar series, Wired GC-Off The Meter.
Our third seminar is entitled “Collaborate to Win”, and features Paul Lippe, CEO of Legal OnRamp, and will be held on Wednesday, November 24, 2008 at 1:30 PM EST. Legal OnRamp is the first legal social networking and collaboration platform for in-house lawyers and invited law firms on the Internet, and currently has over 6,000 member lawyers worldwide, with more joining every day.
Paul, a former GC, will explain how GCs and in-house counsel can use Legal OnRamp to save money, make their jobs easier and share with peers. We will also discuss what might be around the corner for the ‘Ramp.
The series available to the legal community without charge thanks to our exclusive sponsor, The Vallex Fund. This is not your typical web-based seminar: each every-other-month installment will be fast-paced, insight-oriented, and short (less than 30 minutes).
Full details are on the dedicated series page; registration is quick, and allows you to attend the seminars live, or view them on-demand after. Also, when you confirm your subscription, you will get a copy of the series white paper: “Changing the Law: Metrics and Milestones.” It gives some hints as to future seminar topics as well.
Take 30 seconds to register; we have a virtual seat saved with your name on it.
Current subscribers to Wired GC -Select are already registered.
Billing Rate Increase? Try 20% Discount!
November 4, 2008 | Filed Under Cost Control, Law Firm Trends
Bloomberg reporters Carlyn Kolker and Lindsay Fortado delivered a great article today about one company’s ability to get a substantial discount in exchange for a continued commitment of business:
Lawyer Mark Peroff made a promise to the Japanese maker of the video game “Final Fantasy” when he moved to Hiscock & Barclay, a 200-attorney firm in upstate New York: I’ll cut my legal fees if you follow me.
The answer from his Tokyo-based client Square Enix Holdings Co.: “We’re on board,” according to Peroff, who works out of Hiscock’s Manhattan office and says he’s undercutting larger New York firms’ hourly fees by up to 20 percent.
This article is worth printing out and marking up. In-house lawyers will find it instructive; law firms might consider it as wallpaper for a dartboard.
As far as the annual rate increases, this year firms may find that clients are in a different frame of mind. It may be that holding the line on rate reductions is the new increase.
More later this week (I’m on my way to a post-election kegger; half-full or half-empty depends upon your point of view…).
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