{"id":7873,"date":"2007-08-18T12:43:25","date_gmt":"2007-08-18T17:43:25","guid":{"rendered":"http:\/\/blogs.law.harvard.edu\/ethicalesq\/2007\/08\/18\/broadening-the-hourly-billing-deba"},"modified":"2012-04-12T21:54:48","modified_gmt":"2012-04-13T01:54:48","slug":"broadening-the-hourly-billing-debate-consider-yourself-your-clients","status":"publish","type":"post","link":"https:\/\/archive.blogs.harvard.edu\/ethicalesq\/2007\/08\/18\/broadening-the-hourly-billing-debate-consider-yourself-your-clients\/","title":{"rendered":"broadening the hourly-billing debate — consider yourself, your clients and your ethics"},"content":{"rendered":"

\"\"<\/a> Y<\/strong><\/em>es, I often disagree with those who decry the use of hourly billing by lawyers and make it a scapegoat for all that ails the profession and irks its clients [see, e.g.<\/em>, our prior posts “presumed ignorant<\/a>” (July 26, 2007); chronomentrophobia<\/span><\/a> (Jan. 7, 2005)<\/span>; and “Value Billing or Venal Bilking?<\/a>” (Feb. 17, 2004)]. Nonetheless, I’m pleased to see that Scott Turow’s ABA Journal<\/em> cover article, \u201cThe Billable Hour Must Die<\/a>\u201d (August 2007), has provoked so many webloggers to write about whether or how we can get rid of the billable hour or the billable hour quotas<\/em> that require unreasonably long work weeks and inspire all the wrong incentives in the lawyer-client relationship.<\/p>\n

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Participants include Prof. Daniel Solove<\/a> at Concurring Opinions<\/em>, Carolyn Elefant<\/a> at MyShingle<\/em>, Susan Cartier Liebel<\/a> at Building a Solo Practice<\/em>, Andrew Perlman<\/a> at Legal Ethics Forum,<\/em> Scott Greefield<\/a> of Simple Justice<\/em>, Luke Gilman<\/a> at Blawgraph<\/em>y, and many more.<\/p><\/blockquote>\n<\/blockquote>\n

I was especially pleased to see law student Luke Gilman’s follow-up piece yesterday “More on the Billable Hour, Charting Your Own Course<\/a>” (Aug. 17, 2007) at Blawgraphy<\/em>, because Luke clearly realizes that whining and opining are not enough: individual lawyers have to take responsibility for the practice setting they choose and its practical and ethical ramifications. He asks “So, law students, what to do?” and suggests:<\/p>\n

“First, make yourself aware of the reality of legal practice. You\u2019ve made a tremendous investment in money and time to go to law school. Wouldn\u2019t it be worth investing a little time to figure out what you\u2019ve gotten yourself into? I\u2019m stunned at how much some of my fellow students seem not to know about the practice of law and how little interest they show in learning more.<\/p>\n

\"\" “Second, know thyself. BigLaw practice isn\u2019t for everybody, but somebody\u2019s got to do it and a lot of those people love it. You might be one of those people. . . . .<\/p>\n

“Third, if you do find that it\u2019s not the life for you, figure out your alternatives. There are alternatives.<\/p><\/blockquote>\n

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(1) You might decide to hang out your own shingle. . . . . .<\/p>\n

(2) You might choose a practice area with this in mind. ….<\/p>\n

(3) Know the culture of the firms you\u2019re interviewing with ahead of time. …. All firms feel the pressure of billable hours, but different firms deal with it differently. Know who you\u2019re getting into bed with. . . . . “<\/p><\/blockquote>\n<\/blockquote>\n

\"\"<\/a> W<\/strong><\/em>hat I am still not seeing enough of, however, is a focus on the ethical and economic realities and pitfalls of the so-called alternative billing<\/em> mechanisms. From my perspective<\/a>, although there is great structural ethical peril in the bloated hourly quotas used by most large law firms (see “Sanction This (Firm)!<\/a>“), there is nothing inherently unethical about billing by the hour. The problems virtually always arise from its abuses, most of which stem from the desire for greater income and profits — a desire that will not go away when you switch to a different method for setting fees. Therefore, if you choose not to bill your clients by the hour, you need to understand the anti-client incentives that inhere in every billing method; and the ethical lawyer and law firm need a theory and game plan that will allow them to avoid economic and ethical traps while setting such fees, and to serve their own legitimate financial needs and the best interests of their clients.<\/p>\n

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\"\" Where is the straight-talk or even sincere musing about the ethics and the practicalities of setting alternative fees — whether they are “flat”, “mixed,” “contingent,” “value-based,” or tied to “discrete tasks”? Lord knows, I have tried to raise the issues and suggest possible solutions at this weblog: See , e.g.<\/em>, “Value Billing and Lawyer Ethics<\/a>“(Jan. 28, 2004); “Value Billing or Venal Bilking?<\/a>” (Feb. 17, 2004); “brandLEX<\/a>” (March 4, 2004); “fee fie foe and fum<\/a>” (Jan. 5, 2005); chronomentrophobia<\/span><\/a> (Jan. 7, 2005)<\/span>; “LexThink about higher fees (er, value billing)<\/a>” (April 6, 2005); “ethics aside<\/a>” (April 8, 2005); “ron baker & price sensitivity<\/a>” (April 21, 2005); “lawyers and cashews and premium pricing<\/a>” (May 9, 2006); and “the value-billing babysitter<\/a>” (March 23, 2006); “contingency fees (part 4): ethical duties<\/a>”\u00a0 (April 8, 2006); “presumed ignorant<\/a>” (July 26, 2007); updates:<\/em><\/strong> “broadening the billable hours debate<\/a>” (Aug. 18, 2007); why do lawyers lie (about contingency fees)<\/a> (Aug. 29, 2007)<\/span>; contingency fees and the clueless fiduciary<\/a> (Sept.4, 2007<\/span>); “finally: NLJ <\/em>on the realities of alternative billing<\/a>” (Sept. 11, 2007); “time, fees, flu, pumpkins, too<\/a>” (Oct. 10, 2007), discussing the Boston Globe<\/em> article “Beat the Clock<\/a>” and related weblog posts; unconscionable silence over Graubard\u2019s $42 million contingency fee<\/a> (December 11, 2007);<\/span><\/span><\/span> “doubts over debt negotiation fees<\/a>” (July 21, 2008); “ALF#1: other thoughtful voices on the lawyer billing debate<\/a>” (Feb. 22, 2009)<\/p>\n