GAL Radio Presents: Top 5 changes in the business of law from 2004-2019

The Greatest American Layer Blog launched 15 years ago in 2004.  With thousands of blog posts about innovations in law, we decided to highlight the biggest changes we have seen in the business model of law, over the last 15 years. The good news?  Things have improved dramatically over for both clients and lawyers since 2004.  The bad news?  The level of innovation in law continues to drag behind virtually every other industry segment. In short, lawyers and clients need to continue to create new levels of transparency, alternative billing models, learn to share risk and deliver better customer service.  Judges need to work harder at creating efficiencies in the litigation process.   Law students need to inspire their superiors to use technology to create efficiency and transparency.  www.greatestamericanlawyer.com

Welcome to the reincarnated podcast know as GAL Radio, the Greatest American Lawyer Podcast.   Who is the greatest American lawyer?  You are.  You have the potential to change the game.  To break the mold.  To innovate.  To differentiate.  To offer new business models of legal services and client solutions which bring the profession of law closer to its ideal.  To break the chains of mindless billable hours.  Our podcast mission is to change the way law is practiced.  We want to take a moment to thank you for listening to the Great American Lawyer Podcast and being part of the conversation. Click the comment link to send us a message, clap back or send us ideas for future shows. Now, back to this episode of the Greatest American Lawyer podcast. 

Was Katie Billing by the Hour?

As I kept a watchful eye on my iPhone as my partner Brian’s wife Katie started into her 36th hour of labor, I felt a twinge of concern.  “How is she handling all that labor?”  “How is Brian holding up through all those contractions?”

And then it occurred to me.  I quickly picked up my iPhone and sent Brian a text.  “Are you sure Katie is not billing by the hour?” 

I laughed to myself raptured in my own wit.  The more I thought about it, the more I laughed.  In many ways, practicing law to a set of minimum hourly billings is like endless labor.  You and your client endure the pain of it.  But the baby never seems to come. 

Congratulations to Brian and Katie who welcome a beautiful little girl into the Traverse Legal Family!

Attorneys Need to Learn to Invest in Their Clients’ Success

Oftentimes, attorneys are so focused on minimum billables and hourly billing that they forget that their clients can’t pay them if their clients don’t do well.  There’s a big difference between responding to a client’s phone call for help, and actively helping a client protect and grow their business.  Providing value to a client means much more than simply putting out a fire which grew so hot that it started to burn.

All-Time Worst Lawyer Billing Practices

As you all know, I’m not much of a fan of hourly billing.  Sometimes, we do it in litigation as part of a blended arrangement where we share risk with the client.  This can either be a flat fee cap or a contingency fee component to hourly work.  But a story I heard from a client the other day got me thinking.   What are the worst billing practices used by lawyers?  Here’s my list:

• Calling a client who doesn’t have a live project to find out how they or their company are doing and then sending a bill to the client for the time spent on the phone.
• Offering to pay for a lunch with the client and then sticking that as a “cost” item on the bill.
• Billing time that doesn’t add any value to the matter.
• Billing for cover letters which contain no substance or analysis.
• Billing the client time when they question the bill.

Come on.  You can do it.  Give me some additions to the list.  I know you have them!

Is it the End for BigLaw or a Beginning for Change?

At a two-day conference hosted by the Georgetown Center for the Study of the Legal Profession called Law Firm Evolution: Brave New World or Business as Usual?, scholars, consultants, attorneys and law firms gathered together in debate and discussion over the future of BigLaw and its need for change. 

Here are a few excerpts from “Warnings Toll for BigLaw Firms Resistant to Change” by Rachel M. Zahorsky on the ABAJournal:

Time to Say Goodbye to Billable Hours

I thought you'd be interested in this ABA Journal story:

Cassens Weiss, Debra, How Lawyers at One Small Firm Said Goodbye to the Billable Hour. ABA Journal.

Ronald J. Baker Continues His Push to Kill the Billable Hour

For those of you who don’t know, Ronald J. Baker is one of the foremost advocates for alternative billing and killing the billable hour.  He started his accounting career with KPMG in San Francisco.  Today, he is the founder of VeraSage Institute, a think tank dedicated to teaching value pricing to professionals around the world.

If you haven’t checked it out, he was interviewed on blogtalkradio recently about his mission to kill the billable hour.

Why "Trust But Verify" Hourly Billing Doesn't Really Work

We recently posted about some of the challenges which firms that are struggling financially face in preserving their client relationships.  Let's face it, there is always an uneasy balance of "friend or foe" between clients and their hourly billing law firms.  Some commenters replied that clients need to "trust but verify" the hourly billing engaged by their law firms, perhaps even more carefully now that there is a lot of financial stress in the system.  Others noted that big law firms who are cutting lawyers should be more trustworthy since they are at least taking measures to cut costs.  Other firms who aren't cutting lawyers may simply be engaging in "make work" projects which provide very little value to clients. 

Clients Love Flat Fee Billing Based on Defined Deliverables

I’m in Los Angeles, California this week for a federal court status conference and facilitated mediation in an unfair competition, keyword advertising trademark infringement case.  At dinner last night with the clients, the issue of lawyers quickly came to the forefront.  Both clients’ fathers were lawyers, and are inundated with friends who are lawyers.  They wanted to let me know that they really appreciated and loved the flat fee defined deliverable billing model, which we use at our firm.  One of my clients shared a story.  His dad pulled him aside during a hunting trip when he was a teenager.  He let his son know that he was not making any money on the trip because he was tied to an hourly billing method.  His dad let him know that his friends, who were businesspeople, were all still making money even when they weren’t sitting at their desks. 

Unfortunately, neither the flat fee nor the hourly billing method allows you to make money when you’re not working in the service business.  But I am constantly being reminded by clients, especially sophisticated clients, that they prefer and appreciate the flat fee defined deliverable model.  A lot of times, lawyers and commentators discussing the issue forget that the real proof is in the pudding.  Clients prefer to know what they’re going to get and what it’s going to cost.  Lawyers prefer to know what they have to deliver and to be in a position to focus on those deliverables.

The Nonsense of The Billable Hour

In an article he wrote for Forbes Magazine, Trial Attorney Evan R. Chesler, discusses a better way to bill clients by simply playing fair.