f/k/a archives . . . real opinions & real haiku

April 12, 2006

contingency fee serendipity

Filed under: pre-06-2006 — David Giacalone @ 12:40 pm

Walter Olson is absolutely correct [this time]: there appears to be a

Contingency-fee-o-rama going on.  In addition to his kind pointer to

our series last week, Walter notes that “Anyone interested in the

ethical, practical and philosophical case for and against the lawyers’

contingency fee (or contingent fee; usage varies) should be sure to

check out” the new Featured Discussion at Point of Law (since April 10),

which “pits George Mason lawprof Alex Tabarrok, who’s generally sup-

portive of contingency fees, against Jim Copland of the Manhattan Institute,

who’s critical.”


WOlson For Walter’s own views, see Chapter Two of his 1991

book The Litigation Explosion, pdf-posted at Point of Law.

Tabarrok and Copland agree that there are legitimate (and helpful) uses for

contingency fee arrangements.  They differ on what consititutes an abuse

of contingency fee and what (if anything) to do about it. We’ve criticized a

well-known study co-authored by Tabarrok here, for elevating the results

that he posits from economic theory over the reality that is before our eyes

on how lawyers and clients act.  Copland seems to do a bit of that, too.

 

Nonetheless, I tend to agree with Jim’s statement

 

                                                                              greater than eq  one third gray  


“Lester [Brickman]’s study, importantly, looks at the top quartile

of contingency fee lawyers. Some of those lawyers are indeed

getting paid handsomely for risk, luck, or performance. Others

are exploiting the information imbalance between plaintiffs and

lawyers to get extra cash based on the absence of price compe-

tition over fees. But among the lawyers not in the top quartile,

a lot are doing worse than hourly lawyers. They’re often less

skilled, in courtroom work, in preparation, in case screening, or

even in advertising strategy. Still, they stick around chasing the

big payoffs, at least as long as they can. The absence of price

competition over contingency fees leads directly to more contin-

gency fee lawyers — and more lawsuits and cost to society.”

tiny check  On a related note, Moe Levine left this Comment yesterday, in response

to our contingency fee analysis:


. . . saying that no firm has been willing to budge from the statutory

maximums . . .

 

Which is just as likely to be evidence that the statutory maximums

are too low  

 

Second, show me any other business that charges less than the

statutory maxmiums–look at cable tv, credit cards, etc. etc.

I sure hope the p/i bar has better arguments than this for charging so much

to each injured client (no matter how large or winnable the case may be). In

part, I replied to Moe: 


If you’re this Moe Levine, I sure hope you are not teaching lawyers

that we have no more ethical and fiduciary duties to clients to charge

reasonable fees than cable tv companies or “any other business” have

to their customers.  Such an attitude needs no further comment from me.

 



taking up

the holy man’s chant. . .

croaking frogs

 

    Issa, translated by David G. Lanoue

 

 

                                                                                                     one third flip

 

No Comments

No comments yet.

RSS feed for comments on this post.

Sorry, the comment form is closed at this time.

Powered by WordPress