Legal Fees Big Enough to Choke a Judge

Oh, the long hours! From partner to associate in a world that somehow has been coined BigLaw of late, we hear of the hours, the hours the hours.

The cost of those hours are paid privately, if begrudgingly, but the nation's corporations. But on the other side of the Atlantic, under the United Kingdom's "loser pays" rule for lawsuits, those hours become public knowledge. And Justice Christopher Floyd of London's High Court has slammed Allen & Overy, one of the city's top law firms, for "some really shocking" costs.

In 15 months, the firm's solicitors managed to spend the equivalent of nine man years in preparation for a five-day trial — a patent dispute between their client, Research in Motion, maker of the Blackberry, and a competitor.

Packing nine years into 15 months gives new meaning to the "24/7" work ethic. Allen & Overy racked up £5.3 million ($10.58 million) in legal fees, by one partner, three senior associates, three associates and an unspecified number of trainees and paralegals.

One senior associate spent 2,252 hours, and another spent 2,291 hours, for charges that totaled nearly ??2 million. "For these sums of money one would be entitled to expect each of them to recite all the documents in the case by heart," Floyd wrote. Very blunt, indeed.

Judges on this side of the pond might take his cue. Another £1 million was charged for trainees and paralegals to read background material, a task that took 5,000 hours!

RIM spent nearly five times the legal fees racked up by Taylor Wessing, the law firm representing its opponent, Visto, a wireless technology company based in the United States. Floyd, himself an intellectual property expert, described the case as "not a particularly heavy patent dispute."

But Allen & Overy disagrees. The firm "secured an outright win for RIM on the issues before the Court at trial. We were asked by our client to vigorously defend them in this case and leave no stone unturned in finding evidence to prove the invalidity of Visto's patent."

Surely the pebbles were sifted as well, and well into the night.

Solicitors' fees have gotten so high that even their colleagues at the bar — the barristers, or litigators who argue cases in court — have taken to criticizing them. Generally self-employed, the barristers work along side teams from large law firms such as Allen & Overy.

"Solicitors' billing rates in the city of London may be becoming unattractively high," says Timothy Dutton Q.C., chairman of the Bar Council, which represents barristers. "People need to keep a clear eye on the fact that the problem solvers are often the barristers," he says, adding, "We are lean and mean."

Allen & Overy points out that RIM is not complaining. And while Floyd's scathing opinion is causing a stir, he's really just making a judgment that Visto should not have to pay for the RIM's desire to leave no stone unturned, says Simon Davis, a commercial litigation partner at Clifford Chance.

"That doesn't mean your opponent has to pay for that," Davis says.

At Clifford Chance, the law firm at the outset of each case looks to "lobby for less work to have to be done" to accomplish the client's goals. And the firm has outsourced routine document management tasks to India. "Never assume you staff every job the same way," Davis says.

Davis sat on a Commercial Court Working Party that examined ways in which to cut down on the amount of work required in these litigations. Among the recommendations: Limit the length of written pleadings to 25 pages, and limiting opening arguments at trials to two days. (The British, they can go on a bit.)

Less work for lawyers! Let's hear it. Surely, they want to spend more time with their families in the West Country.

by Karen Donovan