In a press release made available late this evening (April 1, 2005), the American Tort
Lawyers Association announced the adoption of new ethical standards that should
mean the end of the Standard Contingency Fee among its members. The press
release explained:
Jack Cliente, ATLA’s consumer rights ombudsman, said “We’re tired of
being known as the “At-Least-a-Third Law Association.” A small but
committed group of members were able to convince their colleagues that their
ethical duties were inconsistent with the automatic application of a “standard”
percentage fee.
Cliente explained that the percentage fee charged should reflect how likely the client is
to win, how much money is likely to be rewarded and collected, and how much work and expense
the lawyer is likely to put into the case. At the press conference, Cliente frequently quoted
“While it is easy to defend the philosophy of the contingent fee, it is impossible
to defend its abuses. . . . It has been accurately said, in justification of the contingent
fee, that it is the ‘poor man’s key to the courthouse.’ Professionalism, however,
demands that we be ever mindful that keys are made of brass — not solid gold.”
As of today, April 1, 2005, all ATLA members must give to each client, and thoroughly
lawyer and client must sign. At the core of the Bill of Rights is the requirement that a
lawyer take a list of enumerated factors into account in evaluating each client’s case, and
discuss each factor with the prospective client, before they negotiate and agree upon
the percentage fee to be charged in a contingency fee agreement. Cliente noted that this
position (although now mostly “honored in the breach”) is the profession’s traditional
approach to the use of contingency fees.
Your editor believes the new ATLA requirements are a great start
toward fulfilling the admonition in ABA Ethics Opinion 94-389 that
“any lapse from the applicable requirements by some members of the
profession simply suggests that the profession should redouble its
efforts to assure that the ethical obligations associated with entering
into a contingent fee arrangement are fully understood and observed.”
The Bill of Rights appears to draw heavily on the requirements set forth in ABA Formal 
Ethics Opinion 94-389, while also using concepts found in Rule 4-1.5 of Florida’s Bar Code
and in the Bill of Rights that appeared in HALT’s The Legal Reformer (Dec. 1997). [Ethics
Opinion 94-389 is not available online without a subscription, but is discussed here.] Cliente
stressed that ATLA is not affiliated with another bar group using the same acronym, which
has yet to condemn standard contingency fees, although it has publically asserted — when
faced with reform proposals — that such fees should vary depending on the riskiness and
complexity of the individual case.
Editor emeritus of this weblog, ethicalEsq, was certain the Press Release must be an
April Fool’s joke, but ombudsman Cliente has assured us that the entire leadership of
his organization is now strongly behind the reform measure. skepticalEsq concluded
ATLA had discovered plans to clone Judge Preska and put her in charge of regulating
contingency fees. [for more, see ethicalEsq posts such as here and here]
into the snake’s hole
oh foolish
mouse