Comments on: An Honest Lawyer Says Tobacco Fee Claim is Clearly Excessive

By: fsedfewfwe

fsedfewfwe — Mon, 27 Dec 2004 01:27:09 +0000

By: fsedfewfwe

fsedfewfwe — Mon, 27 Dec 2004 01:27:09 +0000

By: David Giacalone

David Giacalone — Tue, 16 Dec 2003 14:51:41 +0000

I just left the following Comment at Carolyn’s site:

Hello, Carolyn. You seem to be worrying about a slippery slope that will turn into a sheer cliff for solos, but that seems most unlikely to happen here. Courts have always asserted the right to look at the reasonableness of contingency fee agreements after the fact, but they very rarely do so. The one time it is done with frequency is in large mass tort cases, where such a review seems absolutely necessary to protect again outrageous fees. These are not the cases that humble solo practitioners are likely to handle, and the attorneys involved are most unlikely to use their windfall to assure accessibility to justice for folks with tiny cases. Even very small PI firms advertise that they only want people with “serious injuries.” I just don’t see review of the Mass. Tobacco fee claim for over $2 billion — which averages $27 million PER YEAR for each lawyer — as being a precedent for everyday personal injury cases. I continue to believe that “but, everybody does it” is no excuse for ethics violations. And, I subscribe to EC 5-1 of the Code of Ethics, which says that neither the lawyer’s personal interests, nor “the interests of other clients . . . should be permitted to dilute the lawyer’s loyalty to the client.” That loyalty goes to over-reaching on fees, too.

Sherry: That’s a very substantive question, despite your disclaimer. The comparison to pro basketball players is meant to place the $27 million per year in a CONTEXT — the lawyers here would on average be paid as if EACH of them were the most highly skilled and successful NBA player (as opposed to just a mediocre player or a benchwarmer). Of course, the fees will be divided so that some of the lawyers receive many times per year what the NBA’s finest receive. Is it reasonable to take that much compensation from a pot of money that could have gone to compensate for your clients’ injuries? Unlike the NBA player, the lawyer has a fiduciary duty to treat the client fairly and to avoid overreaching.

The reasonableness of a contingency fee depends in large part on the relationship of the size of the fee to the risk that was being taken by the lawyer of being inadequately compensated (or not compensated at all); another factor is the skill of the lawyer. One way to look at this is to ask how much potential compensation would have been necessary to lure the lawyer into taking the case. Would or should the $775 million awarded by the arbitrator have been enough? That would have been about $7 million per year on average per lawyer. Is it reasonable to ask your client to give up more than that in fees?

By: David Giacalone

David Giacalone — Tue, 16 Dec 2003 14:51:41 +0000

I just left the following Comment at Carolyn’s site: