lukegilman.com : The Blawgraphy
Life of a Law Student, University of Houston Law Center

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Please note: I'm no longer updating this particular blog, but keep it around for archival purposes. Visit me at the current blog at www.lukegilman.com

The Problem of Discovery

Martha Neil with the  ABA Journal  has a pair of articles up on discovery, OK, Discovery’s a Problem, But What Can Be Done About It? and Litigation Too Costly, E-Discovery a ‘Morass,’ Trial Lawyers Say, prompted by an interim report released by the American College of Trial Lawyers: ACTL & IAALS PUBLISH INTERIM REPORT ON PROBLEMS ASSOCIATED WITH DISCOVERY

Some of the themes of the report:

  1. Although the civil justice system is not broken, it is in serious need of repair. The survey shows that the system is not working; it takes too long and costs too much. Deserving cases are not brought because the cost of pursuing them fails a rational cost-benefit test, while meritless cases, especially smaller cases, are being settled rather than being tried because it costs too much to litigate them.
  2. The discovery system is, in fact, broken. Discovery costs far too much and has become an end in itself. As one respondent noted: “The discovery rules in particular are impractical in that they promote full discovery as a value above almost everything else.” Electronic discovery, in particular, clearly needs a serious overhaul. It is described time and time again as a “morass.” Concerning electronic discovery, one respondent stated, “The new rules are a nightmare. The bigger the case, the more the abuse and the bigger the nightmare.”
  3. Judges should take more active control of litigation from the beginning. Where abuses occur, judges are perceived to be less than effective in enforcing the rules. According to one respondent, “Judges need to actively manage each case from the outset to contain costs; nothing else will work."
  4. Local Rules are routinely described as “traps for the unwary” and many think they should either be abolished entirely or made uniform.

Video: No Legal Recourse

Ah clients, surely legal ethics would be stuck in the stone ages without them.

Abogadomovil – Big Law Refugees Take the Road Less Travelled in New Practice

The Atlanta Journal-Constitution profiles three former big law refugees who left practice at King & Spalding to start up an unusual practice in Law firm takes immigration fight to streets.

When Cherokee County barred landlords from renting to illegal immigrants last year, Hernan, Taylor & Lee filed suit and got the county to back off. In July, when Gwinnett County required the companies it does business with to prove their workers are legal residents, the trio raised constitutional concerns. And when Cobb County proposed a crackdown on day laborers last month, the attorneys with the big RV successfully deflected the ordinance.

If you suspect that not everyone appreciates their efforts, you would of course be right. D.A. King, an anti-illegal immigration activist sent an Open letter to Atlanta ICE regarding Hernan Taylor & Lee and Alianza 17 de Marzo – just part of the illegal alien/open borders lobby in Georgia to a special agent at the Department of Homeland Security uring prosecution of the firm for transporting illegal aliens. Even other immigration lawyers, including Charles Kuck, an Atlanta attorney and president-elect of the American Immigration Lawyers Association, question whether the motivation of the firm is motivated more by “cash or conscience”.

I’ll leave it up to you to judge the ultimate worth of their aims. For law students, allow me to point out the following quote:

They say they make more now than if they had stayed at King & Spalding and achieved junior partner. And less than two years after moving into a new office suite off Holcomb Bridge Road, the 16-person firm has already outgrown the 3,500-square-foot space.

There’s more than one way to make a living as a lawyer. Have clients, will travel.

More on the Billable Hour, Charting Your Own Course

I recent wrote about the billable hour here in The Death of the Billable Hour, Wishing Does Not Make it So. Susan Cartier Liebel left a comment with a link to her excellent post The Cockroach of the Legal Profession – The Billable Hour. The most surprising fact – one that many lawyers are not aware of I would guess – is that the history of the billable hour in the legal is a relatively short one.

Douglas McCollam in a 2005 article in American Lawyer, The Billable Hour: Are Its Days Numbered? traced the history of the billable hour to the then nascent theories of ‘scientific management’ and (ironically) a Legal Aid society.

In 1914 Reginald Heber Smith, a recent Harvard Law School graduate, took over the Boston Legal Aid Society and enlisted the Harvard Business School to help him devise a detailed system to track and manage the organization’s finances. One of his innovations was to have the lawyers begin keeping detailed records of their time on different cases.

Smith took his methods with him to his new firm, Hale and Dorr where he became managing partner. In a short book, Law Office Organization, Smith wrote that “The service the lawyer renders is his professional knowledge and skill, but the commodity he sells is time.” To both the practicing or prospective lawyer, having the accumulation of ones skill, knowledge and training referred to as a “commodity” should be chilling. A commodity (think oil, coal, sugar, etc.) is a product for which there is always demand, but demand without regard to ‘qualitative differentiation’ across a given market. Meaning, in Smith’s formulation, that an hour of one lawyer’s time is no different, or at least of no greater value, than any other lawyer’s. Commodities markets are generally characterized as ruthlessly efficient. No commodity dealer can charge a premium for his product because it’s indistinguishable from any other on the market. The only way commodity dealer can compete is on the basis of volume. If legal services are truly a commodity then the only way one can make more money is to put in more time. Sound familiar?

According to Ronda Muir, the billable hour remained somewhat anomalous in the legal profession until starting to gain traction in the 1950′s.

In 1975, the Supreme Court, outlawing both the capped 1800s practice and the base system from the 40s, held that set fees for legal services constituted price-fixing, and was a violation of the antitrust laws. In response, by the late 1970s, most lawyers charged for their services based purely on hourly billing.

Recognizing the widespread dissatisfaction in the profession caused by pressures of billable hour requirements, the ABA undertook a study of the practice, the results of which were published in the ABA Commission on Billable Hours Report (2001-2002) (.pdf). Ronda Muir did the math based on the ABA’s recommendations in , A Short History of the Billable Hour and the Consequences of Its Tyranny

This time, the ABA recommended billing expectations of 2300 hours annually, composed of 1900 hours billable to clients plus a total of 400 additional hours for: firm service (100 hours), pro bono (100 hours), client development (75 hours), training and professional development (75 hours) and professional service (50 hours). Those expectations translate into a total 9-10 client and other hours @ day, five days @ week, 48 weeks @ year. The standard guideline for billable hours is that it takes approximately 10-12 hours to bill 8 hours. In which case, to achieve the ABA expectations, lawyers would be expected to work 12-15 hours daily.

Billable hours are not foremost in the minds of most law students when slogging their way through law school. This account from the Stay of Execution Blog is probably typical -

I didn’t focus much when I was a law student on billable hours. I was on the BIGLAW track — I figured, I’m smart enough to play in the biggest ponds, I don’t want to hear the wimps and the naysayers whining about “quality of life.” I figured that was silly sour grapes stuff from people who couldn’t hack it. Then I got to BIGLAW and I saw how miserable this timing of every minute can make people. Including me.

Of course lawyers themselves aren’t the only ones affected. See the perspective of a child of a BigLaw partner at Blue Rabbit Hutch:

As much as I admire my dad for the example of hardwork and honesty and integrity that he set, I think I would’ve been just as happy with someone who was less stressed, overworked and underappreciated, or who was at least better able to keep the side effects of that pressure out of the home. My dad made a valiant effort to participate in our upbringing, being supportive of our activities, triumphs and failures. But work pulled him away all too often. It’s easier to understand now, but it was hard as a self-centered kid. And I think he was probably always considered a little too “soft” at his cutthroat firm anyway, because of the time he did take for his family. So really, he couldn’t win anywhere.

Of course quality of life for lawyers is not the only problem posed by the billable hour. The overriding incentive of the billable hour regime is to bill as many hours as you can get away with. When you have a fiduciary duty to your client and a minimum billable hour requirement from your firm, the conflict is inevitable.

So, law students, what to do?

First, make yourself aware of the reality of legal practice. You’ve made a tremendous investment in money and time to go to law school. Wouldn’t it be worth investing a little time to figure out what you’ve gotten yourself into? I’m 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.

Second, know thyself. BigLaw practice isn’t for everybody, but somebody’s got to do it and a lot of those people love it. You might be one of those people. We’ve been on the law firm reception tour the last few weeks and many of the lawyers I’ve met clearly love what they do and regard the sacrifice as well worth it. Others run screaming from it the first year of practice. See this resignation letter from a former associate at Greenberg Traurig who apologizes for accepting the job in the first place.

Third, if you do find that it’s not the life for you, figure out your alternatives. There are alternatives.

(1) You might decide to hang out your own shingle. When you’re the boss you get to set the billable hour requirements at whatever number you see fit. You have to eat of course and there are bills to pay, but if control is what you’re after, being your own boss is a good way to get it.

(2) You might choose a practice area with this in mind. D. Todd Smith notes in Texas Appellate Law Blog: Is Appellate Law Suited to Alternative Fee Structures?, that “[c]ertain features of appellate practice make breaking away from the billable hour possible.” Nearly every appellate practitioner I’ve spoken to has mentioned quality of life and predictable (not always fewer) hours as a big reason they’re in that practice area.

(3) Know the culture of the firms you’re interviewing with ahead of time. Talk to the attorneys, ask them about their experience. All firms feel the pressure of billable hours, but different firms deal with it differently. Know who you’re getting into bed with. If you’re going to work those hours make sure it’s with people you’ll enjoy being around for a significant portion of your day.

The Death of the Billable Hour, Wishing Does Not Make it So

Scott Turow notes that “[f]or too many litigators, our life increasingly is a highly paid serfdom—a cage of relentless hours, ruthless opponents, constant deadlines and merciless inefficiencies.” His culprit? The Billable Hour.

When I left the government for private practice in 1986, the hours expectation for young lawyers was 1,750-1,800 hours a year in the large Chicago firms. Today it’s 2,000-2,100—even 2,200 hours. And the only real outer boundary is that there are 24 hours in a day—and 168 in a week. Increasingly, if we allow time for trivialities like eating, sleeping and loving other people, it is clear, as a simple matter of arithmetic, that we are getting close to the absolute limit of how far this system can take us economically.

The death of the billable hour is of course, prematurely heralded. Even Turow does not seem to think the billable hour is disappearing any time soon. Rather than predicting its demise in the article, he concludes by merely wishing it would go away.

Scott Turow: The Billable Hour Must Die

The issue is one of incentives. While the client’s interest is in keeping costs as low as possible while still ‘winning,’ and the lawyer’s responsibility is to act in the interests of the client, the billable hour upends this little economic ecosystem. The lawyer – economically rational, rent-seeking, profit-maximizing mercenary that he is – has an incentive to bill as many hours as he can get away with. Clients are savvy enough to recognize the disconnect and billing becomes a source of suspicion and at times, contention in the attorney-client relationship.

So if we’re not counting off the hours of the day in sixths, how will we get paid? Ay, there’s the rub. Turow mentions one alternative, the “fair fee method” which is described as by a practitioner as “We do the work, and at the end we get together and agree about what’s a fair fee.” Gee, I can’t imagine any dispute would arise out of that arrangement. Hire that guy to write all my contracts. Turow does not seem to do more than sip from this kool-aid either, but neither does he make any other suggested alternatives. He hopes merely that somehow, we’ll figure out a way.

Some interesting responses from Daniel Solove at Concurring Opinions, Scott Greenfield at Simple Justice, David Giacalone at f/k/a, Carolyn Elefant at My Shingle.

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