Article

Legal

June 6, 2013


Participants:

Back Row:

Rand Bateman, Bateman IP ; Scott T. Evans, Christensen & Jensen; Lynn Davies, Richards Brandt Miller Nelson;
Kevin Pinegar, Durham Jones & Pinegar; Hal J. Pos, Parsons Behle & Latimer; Dave Epperson, Epperson & Owens; Arthur Berger, Ray Quinney & Nebeker; Bill Fillmore, Fillmore Spencer

Front Row:

Lorin Barker, Kirton McConkie;  Heidi Leithead, Parr Brown; Steve Clyde, Clyde Snow; Peggy Tomsic, Magleby & Greenwood; Brent Lorimer, Workman Nydegger; Brian Babcock, Babcock Scott & Babcock;  Edgar Cataxinos, TraskBritt; Mark R. Gaylord, Ballard Spahr; Brian Burnett, Callister Nebeker; Kevin Anderson, Fabian & Clendenin

Seated:

Paul Harman, Jones Waldo; Gregory Williams, VanCott Bagley; Ellen Maycock, Kruse Landa Maycock & Ricks; Catherine Larson, Strong & Hanni; Lori Nelson, Jones Waldo; Robert Rapp, Austin Rapp & Hardman

Not Pictured: Eric Maxfield, Holland & Hart

The legal industry has experienced its own set of challenges and successes in recent years. This group of leading lawyers discusses industry trends such as changes in billing methods, influx of recent graduates, social media challenges and courtroom ethics.

What do you think the economy has done to fundamentally change how we do business now?

CATAXINOS: We specialize in Intellectual Property (IP) law. What we have seen, mainly from in-house departments, which we deal with pretty much 100 percent of the time, is during the recession you had a lot of pullback from accounting departments which were overseeing the IP departments. You’re still seeing some of that today, but some of the panic is gone now, although some of the restrictions still apply with regard to budgets.

TOMSIC: We do litigation only, and complex commercial litigation. A lot of businesses do a lot more competitive bidding for different cases and try to really get law firms to come down in terms of the number of people they’re putting on cases or negotiate their hourly rate.

At the end of the day, though, when you get into large litigation, even through the recession, businesses are a little more willing to pay a higher price if you have demonstrated that you have a good track record of winning.

PINEGAR: One of the things it’s caused us to do is to be more careful in the client selection and intake process than we have been in the past. We are more aware of our accounts receivable. We’re more likely to get retainers. We’re just more careful in the whole process than we were before.

Have any of you seen clients demand different billing methods because of the change in the economy?

WILLIAMS: We’re seeing a lot of clients in corporate or real estate transactions require a maximum fee right from the beginning, which is kind of hard because you don’t know much from the beginning. That’s fairly common—as are reduced rates for certain aspects of work.

POS: With lots of clients we go through discussions about alternative fee arrangements. But what it seems like we see is discounts. That seems to be one of the big changes coming out of the recession. While there’s an uptick in business and some of the concerns about business growth are lessened, there’s still a strong control over budgets. So we typically get into discussions about discounts with lots of clients, both new and existing clients.

LEITHEAD: One of the interesting things we’ve seen with a couple of large cases we’re working on is the notion of buy-in with the client. We negotiated something of a discount and we’d say to the client, “You can hold back 10 percent of your fee. And then whether or not we get paid, that depends on the outcome of the case.”

TOMSIC: One of the things that we have done in litigation that tends to gather momentum, which we didn’t anticipate at the beginning, is work out some type of a deal that you get a lower hourly price, but if you win at the end of the case, you’ll get two times your hourly rate. That divides the risk a little bit with the client so that it gets more result-oriented.

Is flat-fee billing becoming more common?

LORIMER: We have basically two sides to our shop. One is the prosecution, which is the obtaining of patents, the other side litigation. Patent prosecution has gone largely flat fee. The difference in what we have now versus what we had before is what clients are asking that we include in the flat fee. They’re now requiring—some of them—to have the drawings included in a flat fee and not a separate charge for that. Some of them are not allowing charges for interviews at the PTO. So they’re just cramming more and more into less and less.

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