Lawyers aren't overpaid at all. Just ask Delaware Judge Leo Strine. He recently approved $285 million in attorney's fees in a shareholder derivative suit to two plaintiffs' firms.
Broken down, the $285 million of attorney's fees essentially means the firms are getting around $35,000 per billable hour. The firms purportedly spent around 8,000 hours on the case, according to Thomson Reuters News & Insight.
It's good news for attorneys. I mean, it's flattering to think that every hour of your time is worth $35,000. But what exactly happened in this case?
The facts are a bit complicated. Simplified, the plaintiffs and their attorneys claimed another party overpaid a huge amount: $3.75 billion in stock, reports the Wall Street Journal. In the end, it was the attorneys who won big.
As any BigLaw associate knows, big judgment amounts are built by two things: long hours, and lots of attorney's fees.
Of course, BigLaw peons likely won't be seeing much of the settlement. It's unlikely that the firm will compensate everybody equally. That e-discovery contractor that did nearly 99% of the doc review for the case probably won't be swimming in the dough anytime soon.
But maybe the partners will.
After all, we all know that law partners are in dire need of some more cash to line their pockets.
As staggering as this judgment may seem, it's not the highest in legal history. Plaintiffs' attorney's fees in the Enron case totaled $688 million, reports the Wall Street Journal. Lawyers in the Tyco International suit were given $492 million.
So take that all you naysayers that claim attorney's fees are too high.
- Record $285 ml fee award is Strine's message to plaintiffs' bar (Thomson Reuters News Insight)
- 46 Years Later, Desegregation Attorney Wants $10 Million in Fees (FindLaw's Greedy Associates)
- Why Aren't You Billing at $1,250 Per Hour? (FindLaw's Greedy Associates)