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For many years, there have been qualified attorneys performing contingent fee services in securities class actions, consumer class actions, toxic tort and personal injury cases. But, historically at least, the contingent fee approach has not been a viable option for complex business cases. Why has this been the case? There seem to be three key reasons: Supply, demand, and tradition.
On the supply side, highly skilled business litigators, with elite credentials, have historically gravitated to the established corporate law firms. These firms are conservative and traditional by nature and will rarely take a case on a contingent fee basis. Indeed, contingent fee arrangements are often viewed by business litigators, and corporate law firms, as not only risky, but even unseemly. This has resulted in a perception of a “bright line” separation between hourly attorneys and firms, on one side of the line, and the plaintiffs' contingency bar, the notorious plaintiffs' trial lawyers, on the other.
On the demand side, businesses have historically been most comfortable retaining counsel from traditional corporate law firms and paying for representation on an hourly basis. This stems in part from the (inaccurate) view that the best lawyers and best law firms work on an hourly rather than contingent fee basis. Moreover, the same perception that there is a “bright line” division between hourly attorneys and the plaintiffs' contingency bar has steered companies away from even thinking about retaining attorneys on a contingent fee basis.
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