JD Journal » billing rates

Billing Rates in Washington, D.C. Are Second Highest in the U.S.

ashley — Sun, 12 Sep 2010 00:24:35 +0000

Between 2007 and 2009, CT TyMetrix Inc. and The Corporate Executive Board gathered invoice data from over 3,500 law firms and 90,000 individual billers across the nation. Ultimately the invoices came to $4.1 billion.

According to the CT TyMetrix Inc. and The Corporate Executive Board survey on billing rates, Washington, D.C. law firm partners come in at a close second for the highest rates in the United States at $600 an hour for their time. New York City law firm partners charge the most in the United States at about $700 an hour. Washington, D.C. associates, however, bill at only $375 an hour, more than in San Fransisco, and just less than Las Angeles.

Over the three years of the CT TyMetrix Inc. and The Corporate Executive Board survey, it was also found that District of Columbia lawyers raised their rates on an average of 10.5%. In comparison, lawyers in Detroit only raised their rates 2%, the least in the country, and Dallas invoices showed the highest rate raising at 21.9%.

It seems lawyers nationwide do not necessarily have set rates, however. The survey found that 85% of lawyers change their rates for the same work depending on the client.

Morning Roundup

joshua — Wed, 11 Aug 2010 13:06:41 +0000

Good morning everyone! Today is Wednesday, August 11th. Here’s a quick recap of yesterday’s stories.

Venable added corporate attorneys from DLA Piper as partners in its New York office…

Megafirm DLA Piper promoted two partners to the office of chair…

Thompson Hine’s Michael Zimmer was named ABA Committee Co-Chair…

The National Law Journal Survey of Law Firm Economics revealed a tough economic climate…

Employees laid off in Louisiana are suing over their job loss…

A National Law Journal study showed that law firms cut costs by cutting lawyers and law firm staff…

Joel M. Schoenfeld, music industry executive and lawyer joined Mitchell Silberberg & Knupp as a partner…

LeClairRyan selected a new CEO…

NLJ Survey Highlights Tough Economic Climate

joshua — Tue, 10 Aug 2010 17:08:18 +0000

The National Law Journal Survey of Law Firm Economics showed staffing ratios at small and mid-sized U.S. law firms in 2009 reached their lowest levels since the 1980’s.

The downward trend in staffing is largely the result of efforts by law firms to lower costs. The survey, based in 2009 data, found the average ratio of associates to partners had decreased by 8.2 percent, the average ratio of paralegals to all lawyers dropped 15.4 percent and the average ratio of support staff to all lawyers decreased by 9.3 percent.

The survey was conducted by ALM Legal Intelligence and also reports on annual financial performance, compensation, billing rates and hours. David Brown, editor in chief of The National Law Journal, said this is the first time in the 38 years of the survey it has shown year-over-year declines in revenue per lawyer, expenses per lawyer and compensation for senior partners.

“This year’s Survey of Law Firm Economics shows just how deeply the recession has affected smaller and midsized law firms around the country,” Brown said.

Among the survey’s other findings:

n Revenue per lawyer decreased 0.2 percent from $413,086 to $412,220

n Expense per lawyer decreased 4.6 percent from $167,256 to $159,521

n Average billing rates for senior partners increased 3.2 percent from $346 to $357

n Average 5^th year associate billing rate increased 0.5 percent from $218 to $219

n Average billable hours for senior partners decreased 1.7 percent from 1,656 to 1,628.

n Average billable hours for 5^th year associates increased 0.6 percent from 1,801 to 1,811.

n Median total compensation for senior partners decreased 1.7 percent from $328,260 to $322,813.

n For the third year in a row, starting salaries for new graduates remained unchanged at $85,000

The National Law Journal’s Survey of Law Firm Economics is one of the most complete set of economic statistics and financial data available about the legal profession. This year’s survey contains information from 10,913 lawyers including 3,712 associates, 6,236 partners/shareholders (equity and non-equity), 608 active counsels, and 357 staff lawyers working in 187 U.S. law firms.

Report: Varied Billing Rates Could Provide Bargaining Chip

joshua — Wed, 26 May 2010 23:32:35 +0000

A report set to be released this Fall could give general counsel an “enormous amount of bargaining power” in their billing rate negotiations with law firms, the Corporate Counsel reports.

The “Real Rate Report” by CT TyMetrix and The Corporate Executive Board shows firms’ charge a wide range of rates to different clients for nearly identical work. While that fact certainly comes as no surprise, as Corporate Counsel duly notes, the wide range of prices that were actually charged could give clients a “powerful” bargaining chip in billing rates.

“It will give general counsel an enormous amount of bargaining power,” Julie Peck, vice president of corporate strategy and market development at CT TyMetrixPeck, told Corporate Counsel in a report reprinted at Law.com.

“What that tells you is that there’s a significant amount of pricing elasticity in the market, and that negotiations can be very powerful.”

The report, based on an analysis of $4 billion in law firm billings, is slated for a September release. It surveys billable hours for 3,448 partners, associates and paralegals and finds that more than 75 percent charged different hourly rates for similar work. Corporate Counsel reports the largest rate differences of between $350 an hour to $1,000 a single person charges did open some eyes.

Other findings in the report show that while law firm partners charged corporate clients up to $1,590 an hour in 2009, the median partner rate of $340 an hour “is significantly lower than reported” in most other surveys.

Morning Roundup

joshua — Fri, 15 Jan 2010 12:45:12 +0000

Good morning! Today is Friday, January 15, and here’s a look at yesterday top stories…

A study from Altman Weil predicts biglaw billing rates will rise this year…

The former COO of TARP has joined Cozen O’Connor..

White & Case has launched a arbitration practice in Singapore…

Dickstein Shapiro is abandoning lockstep compensation…

and the UK’s Appleby opened an office in Guernsey…

Study Indicates Billing Rates to Rise This Year

joshua — Thu, 14 Jan 2010 23:59:18 +0000

A survey conducted by Altman Weil projects U.S. law firms will raise billing rates by an average of 3.2 percent in 2010. The study polled 688 U.S. law firms that have 50 or more lawyers and was conducted in November of last year.

The uptick follows a nearly two-year rate freeze, according to the report. Larger firms (1,000+ lawyers) anticipate a slightly higher average increase at 4 percent, while smaller firms are expected to raise rates by 3 percent.

“Although these results may seem to contradict some expectations for rate freezes in 2010, this is a relatively conservative rate increase by law firms that are struggling to balance their own business perspective with the needs of their clients.” said Altman Weil principal Tom Clay. “Most firms are making careful, considered increases – often client by client or lawyer by lawyer – unlike prior years when across the board increases were typical.”

“Law firms know that this is a buyers’ market.”

The study also solicited comments from participating firms. Among the reasons cited for why rate increases were necessary is the need to raise rates after a freeze of up to two years, increases for specific practices that are under-priced compared to the market, and increases for associates and junior partners to reflect their increased experience.

Altman Weil was founded in 1970 and provides management consulting services to firms.

2010 Steel Cage Match: Corporate Clients vs BigLaw

joshua — Thu, 03 Dec 2009 23:22:34 +0000

I have a mental image of two giants staring each other down inside a locked steel cage before charging at one another, swinging leather briefcases and throwing blackberrys. In this corner, wearing a charcoal suit and a red power tie we have BigLaw, who wants to raise billing rates by 5%, and in this corner wearing a black pinstripe suit with a pastel blue tie we have Corporate Clients, who want to pay 2008 rates or less. The cage is sealed, and only one will emerge victorious.

In a year in which both law firms and their corporate clients have had to make deep cuts and face economic uncertainty, neither side seems ready to blink. Several law firms have enacted salary cuts for first year associates along with lowering the billing rate for their time, and alternative fee structures are on the rise. But profits are down and the easy cost cutting measures have already been enacted, which means law firms want to raise rates to compensate. Corporations are turning to their own legal department for more of their work and are also suffering from lowered profits and greater public scrutiny. In a grudge match with enormous stakes, who will back down first?

Frost Brown Todd Cuts Incoming Associate Salaries

Erik Even — Fri, 12 Jun 2009 17:38:49 +0000

Incoming associates at Cincinnati’s Frost Brown Todd will get a lower salary, although specific numbers have not been released.

In addition, the new associates will spend their first 1,000 hours in an “apprenticeship program.” Clients will be billed at a lower rate for work done by “apprentices.”

I keep putting the word “apprentice” in quotes because an apprentice is a 16-year-old learning to swap out a transmission, not a professional with a college degree and a law degree.

Those who complete the apprenticeship program can earn a merit-based bonus, and the opportunity to get on the regular lock-step pay track after one year.

The firm’s most famous former associates are Jerry Springer and Kenneth Starr. So, way to contribute to America, guys.

Frost Brown Todd LLC is one of the largest law firms based in the Midwestern United States. It resulted from the 2000 merger of Frost & Jacobs LLP, a Cincinnati-based firm, with Brown Todd & Heyburn PLLC, a Louisville-based firm. It presently has 370 attorneys working in nine offices throughout Tennessee, Kentucky, Ohio, Indiana, and West Virginia.

Hildebrandt: Demand for Legal Services Down 8%

Erik Even — Tue, 12 May 2009 18:41:39 +0000

According to the Hildebrandt International Peer Monitor Index, demand for legal services dropped by more than 8% compared to Q1 2008, dropping sharply in January and February but flattening in March.

In New York demand for legal work fell 9.5%; and in Washington DC and London, law work fell over 12%.

Normally, law firm billing rates grow by about 7% a year. But in the last year, rates grew by less than 3%.

The study also suggests that attorney productivity, measured by billable hours, was down overall by 11.5%.

Unsurprisingly, the “good” news was in bankruptcy, where work is up 13% since Q1 2008.

Hildebrandt, part of Thomson Reuters, does merger consulting, with more than 50 consultants located in the United States and in London.

Pillsbury Hiring for Trusts & Estates Practice

Erik Even — Fri, 10 Apr 2009 16:23:12 +0000

Pillsbury, which fired 155 in March, is hiring lawyers for its trusts & estates practice.

Palo Alto-based partner Jennifer McCall, head of Pillsbury‘s estates, trusts and tax planning group, is “looking to add lawyers in New York, Washington, DC, and expand trusts and estates in Los Angeles.”

She says candidates have to be good at tax law, sensitive with people, and high energy. “It’s hard to find a person with those three main components,” McCall said. “We do find them, but it’s hard.”

The practice is competitive with other Pillsbury groups in terms of rates, as partners bill $650 and up. McCall billed “substantially above 2,000″ hours last year, ranking among the highest-hour billers in the firm.

Pillsbury Winthrop Shaw Pittman LLP is an international law firm with offices located throughout the US and globally, including key financial centers New York, London, Tokyo and Shanghai.

Pepe & Hazard Lays Off 5 Lawyers, 7 Staff

Erik Even — Wed, 11 Mar 2009 16:48:39 +0000

Connecticut’s Pepe & Hazard is laying off five attorneys and seven staff members.

The 61-attorney firm says the move “is the direct result of the current economic downturn that is affecting businesses and employers across the nation.”

In January, Pepe & Hazard laid off two attorneys and two staff members, and in December announced a pay freeze .

The firm has also announced it will not be increasing billable hourly rates for clients this year.

Pepe & Hazard LLP has offices in Hartford, Southport and Waterbury, Connecticut, and in Boston.

Allen & Overy to Cut 30% of Trainees

Erik Even — Mon, 09 Mar 2009 16:38:55 +0000

London’s Allen & Overy will only retain 70% of its trainees for September 2009 and March 2010.

The Magic Circle firm has not made a final decision about the retention rate, and said the figure was a “working assumption in light of the current financial climate.”

Allen & Overy retained 86% of its trainees in 2008, 90% in 2007.

The firm offers its training contracts two years in advance, with some 50 trainees joining each year.

Allen & Overy is expected to cut 9% of associates, 9% of support staff and 9% of its partnership.

Around half of the affected positions are in London. The firm is also freezing pay and billing rates at 2008 levels.

Founded in 1930, Allen & Overy has approximately 5,500 staff and 31 offices worldwide.

K&L Gates Freezes Salaries

Erik Even — Sat, 14 Feb 2009 17:30:46 +0000

Above the Law reports that K&L Gates held a meeting Friday to discuss, amongst other things, salary freezes.

Earlier today, associates at K&L Gates attended a town hall meeting with Peter Kalis, chairman and global managing partner. Kalis provided an overview of where the firm stands and announced steps that will be taken to deal with the recession…

Kalis said management would consider the possibility of layoffs at the end of this month.

Salaries are now frozen for all associates, with a review to take place in July.

Incoming first-year associates will have their start date deferred to January 4, 2010.

The firm will be raising billing rates.

Cravath Lawyer: Kill the Billable Hour

Erik Even — Fri, 02 Jan 2009 18:04:45 +0000

Evan R. Chesler, a Presiding Partner at New York’s Cravath, Swaine & Moore LLP, has made a bold suggestion in January’s Forbes Magazine: Kill the billable hour.

I’m a trial lawyer. I bill by the hour. So do the associates who work for me. I have lots of clients, so I can pretty much work, and bill, as much as I want. This needs to be fixed. Yes, you read that correctly.

Clients have long hated the billable hour, and I understand why. The hours seem to pile up to fill the available space. The clients feel they have no control, that there is no correlation between cost and quality.

Chesler compares what he does to what a contractor does — except the contractor gives you an estimate, and then sticks to it. If the contractor gets the job done quickly, he makes more money — if there are problems, he makes less.

So what am I proposing? For reasonable periods of time during the life of a lawsuit, say three months at a time, I should do what [a contractor] does: identify the client’s objectives, measure, calculate, build in a contingency and come back with a price. Once the price has been agreed upon, the billable hour should be irrelevant. The client will no longer be surprised by a whopper bill and met by the standard (albeit true) explanation that “litigation is unpredictable.”

Read the whole article.

Via State Policy Blog and The Los Angeles Examiner.

Boutique to Cut Client Billing Rates in 2009

Erik Even — Wed, 31 Dec 2008 18:08:41 +0000

Austin, Texas-based appellate boutique Alexander Dubose Jones & Townsend is reducing its billing rates in current hourly-fee cases by 10% on January 1st.

Douglas Alexander, a partner in the 13-lawyer firm, notified its clients of the decrease in hourly fees in letters and e-mails.

Roger Townsend, a partner in Alexander Dubose’s Houston office, says the idea behind the reduction is to help the firm’s clients.

But consultant Bill Cobb of Houston’s Cobb Consulting told Texas Lawyer the move “puts [the firm] in a better competitive position with other appellate boutiques out there.”

Clients who will not be impacted by the cut in fees include those who have contingent or flat-fee arrangements with the firm.

Alexander says the firm’s clients range from individuals to Fortune 100 companies. The firm represents those clients in state & federal appellate courts in all types of civil cases, involving anything from personal injury and wrongful death to taxation and breach of contract.

Townsend says he was the first in the firm to suggest cutting hourly billing rates after the idea came to him while meditating.

Via Texas Lawyer.

White & Case Lawyers Bill as Much as $1,260 an Hour

Erik Even — Thu, 11 Dec 2008 23:29:16 +0000

Over 70% percent of large law firms surveyed raised their billing rates this year, with one firm charging more than $1,200 an hour, according to the ABA Journal.

The average partner rate was considerably lower, $451 an hour at all law firms surveyed.

New York’s White & Case, the 10th largest law firm globally, reported the highest billing rate — a whopping $1,260 an hour — for its top lawyers. Next highest was Minneapolis’ Dorsey & Whitney, which bills $1,180 an hour for two of its international tax lawyers.

Law firms surveyed increased billing rates for both partners and associates by an average 4.3% this year, compared to an average hike last year of 7.7%.

White & Case said $1,260 number was “representative of only two potential billing scenarios for clients” and “[did] not take into account a number of key factors, including blended rates and rates negotiated with specific clients.”

Via ABA Journal.