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News Flash: Billing Rates Both Absurd and Obscene

$$Correction: In an earlier version of this post, Dan Currell was incorrectly identified as managing director of the Legal and Compliance Practice for CT TyMetrix. We apologize for the error.

Welcome back from your Labor Day holiday. One can debate whether what lawyers do can actually be considered "labor," but I'm gonna consider this a calendar-appropriate post regardless.

This morning on Am Law Daily, we get a sneak peek at an exhaustive review of three years worth of attorney timesheets. Some company called CT TyMetrix has compiled the 2010 Real Rate Report, and it is a doozy.

What's in the report? You could watch the video on the CT TyMetrix website to find out. But when I tried, I was lulled to sleep by the soothing voice of Dan Currell, managing director of the Legal and Compliance Practice of the Corporate Executive Board, which partnered with CT TyMetrix in compiling the report. So maybe you should just read below:

The Real Rate Report is based on empirical data gathered from $4.1 billion in invoicing generated by over 3,500 law firm and 90,000 individual billers over three years (2007-2009). This comprehensive data encompasses 51 metropolitan areas, companies ranging in size from one to 1,940 and from over twelve industries including energy, entertainment, finance, insurance, healthcare, manufacturing, pharmaceutical, retail and technology.

The "empirical data" was collected from 36 big corporations who pay boatloads of money to outside law firms. And while you will have to buy the report (for $4,500) to get the full flavor, Am Law Daily pulled some of the highlights. To wit:

  • Inflation of associate rates outpaced that of partner rates by almost 2 to 1 from 2007 to 2009 (17 percent to 9 percent).
  • Two unidentified first-year litigation associates are billed out at $650/hour. 
  • 85 percent of lawyers charge different clients different rates for the same type of work.
  • Clients that spend more with a particular firm, rather than getting volume discounts, actually pay a higher average rate.
OK, $650. For a first-year. That is comedy gold. My faith in man's inherent lack of common sense is restored. Let's celebrate with some fireworks.

Posted by Eric Lipman on September 7, 2010 at 11:35 AM | Permalink | Comments (2)


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