The bill to clients is considerable. The median amount that large corporations pay annually for each outside lawyer working for them was $616,519 in 2007, according to the 2007 Altman Weil Law Department Metrics Benchmarking Survey. Chemicals manufacturers topped the list, reporting that average outside legal expenses reached more than $1.1 million per lawyer. That is music to the ears of law firms on the receiving end.

Still, some firms see the growing discontent as an opening to take a new tack. Jay Shepherd, who runs the employment-litigation firm Shepherd Law Group in Boston, jettisoned the billable hour system in favor of flat rates for all client matters at his firm.

Other firms have taken similarly drastic steps, though the number can be counted on two hands—among them, Bartlit Beck Herman Palenchar & Scott and the Valorem Law Group, both in Chicago, Exemplar Law Group, in Boston, Summit Law Group, in Seattle, and Leader & Berkon, in New York.

However, Shepherd's success in gaining business is noteworthy. His firm's year-over-year revenue more than doubled in 2007, after increasing 5 to 10 percent per year between 2004 and 2006. Among his new clients is Adobe Systems.

Although the vast majority of the software company's outside legal work is still done on the billable-hour system, Ronald Friedman, associate general counsel and head of litigation at Adobe, says he's been pleased by Shepherd's flat-fee arrangement, noting that it "allows you to know up front what your costs are going to be."

He hints that, unless billing rates begin to fall, more such deals could be in the offing.

"I am always interested in exploring alternative billing arrangements," he says. But "the more the hourly rates continue to increase to the point of being difficult to justify, the more I am going to be interested in exploring other alternatives where the interests of the client and the lawyer are better aligned."

If enough companies like Adobe make that call, the Sullivan & Cromwells of the world may have to begin listening.