Class Actions And Alternative Fee Arrangements

Two of my favorite legal bloggers have good posts up that you should check out.  Read Marc Mayerson’s post on recent case law interpreting an insurer’s duty to defend class action claims before they are certified as class claims.   Also read this post by Steve Rosenberg about creative fee arrangements for those who need to protect their intellectual property but can’t afford to pay lawyers by the hour.  Here’s a link to an earlier post by Steve about alternative fee arrangements for policyholders in insurance coverage cases. 

I’ve plaintiffed some cases that, after I won, I wished were on a contingency because of the size of the award, but in those cases, of course, the hourly fee arrangement actually turned out better for the client, especially in attorney-fee cases where the client essentially was made whole.  From my observation, most lawyers who are usually defense-side should be very wary of taking contingency fee cases.  I’ve seen some outstanding defense litigators totally bomb when it comes to selecting the right contingency fee case or being able to tell the difference between a winning case and a loser, when they switch to the plaintiff side.  For firms built on the billable hour model, taking a chunk of 300 to 500 hours of uncollected time from several partners and associates not only impacts firm revenues, it often can create dissension within a firm as others question whether the contingency fee lawyers really thought the business decision through or analyzed it correctly.

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