Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
A Rational Basis for Setting Hourly Rates
For the past 20 years, law firms have annually increased their hourly rates on the basis of various ad hoc criteria ' what the market will bear, matching the competition, cost-plus, maintaining profit margins ' that neither firm members nor clients find satisfactory. Alternative pricing methods (fixed fees, percentage of the deal, etc.) have long been advocated as a solution to hourly billing discontents, but in practice, for a large majority of firms they remain limited in application. Firms whose clients expect fees to be charged on an hourly rate basis therefore require a rational means of constructing an hourly rate schedule that is transparent and acceptable to clients as well as defensible within the firm.
Rate-Setting Factors
In the United States, the Model Code of Professional Responsibility (Rule 1.5) provides some assistance in establishing a basis for setting hourly billing rates. In setting a fee, lawyers are allowed to consider any of eight factors, including:
- The time and labor required, the novelty and difficulty of the issues involved, and the skill required to perform the legal service properly;
- The fee customarily charged in the locality for similar legal services; and
- The experience, reputation, and ability of the lawyer or lawyers performing the services.
Therefore, we can develop hourly billing rates that vary by the sophistication of the matter, by the reputation and capability of the specific lawyers involved, and by standards of the marketplace. The mechanics to develop such a system are relatively simple. Three sources of input are required: an empirical basis on which to make assumptions about the level of rates in the marketplace; a means of evaluating the capabilities and reputations of the firm's lawyers; and a system for measuring the comparative sophistication of client matters.
This premium content is locked for Entertainment Law & Finance subscribers only
ENJOY UNLIMITED ACCESS TO THE SINGLE SOURCE OF OBJECTIVE LEGAL ANALYSIS, PRACTICAL INSIGHTS, AND NEWS IN ENTERTAINMENT LAW.
- Stay current on the latest information, rulings, regulations, and trends
- Includes practical, must-have information on copyrights, royalties, AI, and more
- Tap into expert guidance from top entertainment lawyers and experts
Already a have an account? Sign In Now Log In Now
For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?