Legal Commentary

More Evidence Of Corporate America Rallying Against The Billable Hour

By Patrick J. Lamb

On Monday and Tuesday of this week, I attended (and spoke at) the American Conference Institute program on Controlling Legal Expenses.  Both the speaker roster and the attendees were predominantly inside counsel, with a heavy emphasis on those involved in litigation.  The panels on the entire first day were of a like mind that alternative fee arrangements were the future.  I've written before about the Perfect Storm brewing--rising hourly rates and law firm profits meeting a bad economy and law departments facing significant cuts--and that theme echoed from one panel to the next,  Good news for Valorem--that's what we do, after all--but perhaps not so good for BigLaw and firms slow to respond.  The one thing that I found refreshing was that the inside counsel at this conference appeared to understand that a firm cannot simply say "we're now offering alternative fees" and be responsive to client needs.  The move to alternative fees requires major cultural changes in the firms, from compensation to advancement of associates.  One other key message:  fee structures like blended hourly rates and discounts are not alternative fees.  The reality is that more and more clients are looking for firms that have embraced economic models predicated on fee structures other than by the hour.  Perhaps this audience was more sophisticated than average, but I don't think so.  But even if it was, its a harbinger.

Full post as published by In Search of Perfect Client Service on April 02, 2008 (boomark / email).