Lawyers’ emails reveal the obvious: Attorneys’ overcharge

Kai Ryssdal Mar 26, 2013
HTML EMBED:
COPY

Lawyers’ emails reveal the obvious: Attorneys’ overcharge

Kai Ryssdal Mar 26, 2013
HTML EMBED:
COPY

Those among us who’ve had hefty legal bills have wondered why they were so high. There’s lots of lingo for that: “Bill padding.” “Churning.” Even “feather bedding.”

With the acknowledgement that the vast proportion of lawyers only demand what they’re rightly owed, emails uncovered in a court filing last week suggest some have indeed been gilding the lily.

As one of the attorneys wrote to a colleague, “Churn that bill, baby!”

“You have some incredibly damning statements in these emails, basically acknowledgements from these lawyers at this firm that there were some shenanigans going on in the way they worked,” said Peter Lattman, who wrote about the suit for The New York Times Dealbook.

One of the temptations facing lawyers is the billable hour, a standard practice in the legal industry. That is, instead of a flat fee for services, firms charge for the amount of time worked on a case. That provides an incentive to put an excess of lawyers on a wealthy client’s case (“feather bedding”) or to do unnecessary or irrelevant research (“churn”). Although considered unethical, Lattman’s sources estimate that the practices are common.

The firm at the center of the lawsuit, DLA Piper, went a step further in openly acknowledging their efforts to churn legal bills. With 4,200 attorneys, it’s the world’s largest law firm. In other words, plenty of people to add to a case if needed.

And an extra hour here or there may not sound like much, but prestigious corporate firms can charge in excess of $1000 per hour, according to Lattman.

For more on the background of the case, and the disgruntled client who refused to pay his $675,000 legal bill, check out the full column at the New York Times Dealbook.

As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.

Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.

Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.