I appreciate the passion with which you advocate for decreased barriers to legal information. In many respects, I could not agree more; U.S. jurisprudence is synonymous with hyper-technical mutability, and the public is kept in the dark because of pay walls. But, that marks the full extent to which you and I agree on this matter.
In terms of "institutionalized fraud," you are totally wrong. The legal profession is one of the most heavily-regulated professions that exists today. The duties imposed on lawyers--which are legal obligations to act or refrain from acting--should not be taken lightly. For example, Rule 8.3 of the Model Rules of Professional Conduct[1] (adopted in whole or in part by 49 states) provides:
(a) A lawyer who knows that another lawyer
has committed a violation of the Rules
of Professional Conduct that raises a
substantial question as to that
lawyer's honesty, trustworthiness or
fitness as a lawyer in other respects,
*shall* inform the appropriate
professional authority.
(emphasis added). Note the word "shall:" it means that a lawyer who has actual knowledge that another lawyer (regardless of jurisdiction!) violated the rules MUST report the violation to the appropriate authority.
The reason I explain this rule in particular is because of Rule 1.5, which provides in excruciating detail a lawyer's ability to collect fees from a client.[2] Everything you said is wrong.
Here's the short, plain English version of Rule 1.5: the lawyer must communicate the fee arrangement to the client before the start of representation (except when charging an ongoing client the same rate in subsequent matters). There's a blanket prohibition against "excessive fees" and "minimum fees," and a set of factors used to determine whether a fee is reasonable.
Reasonable fees are judged by time and labor, the issues' difficulty/novelty, the lawyer's experience/reputation/abilities, the nature and length of the lawyer-client relationship, whether the lawyer must turn away other cases, whether it's a fixed or contingent fee basis, and the customarily charged fees. When dealing with contingent fee arrangements, they MUST be reasonable and signed by the client, but may not be used in criminal cases. Similarly in criminal cases, a lawyer may not ask for incentive fees, and is proscribed from taking a percentage of publication rights (i.e. Casey Anthony's lawyer asking for a percentage of any subsequent book deal in exchange for his time) until after all appeals have been exhausted. Contingent fees also may not be used in domestic relations.
When dealing with division of fees in law firms, it's not actually a "division of fees" in the legal sense. The lawyers are salaried employees of the law firm, which is hired to represent the client. Again, when you hire a law firm, you are not hiring a single lawyer; you're hiring the entire firm. Division of fees occurs when a single billing client is covering the fees of two or more lawyers who are not in the same firm. When this happens, division is permitted as long as it's proportional to the services each lawyer (or firm) provides to the client, and the client must agree to this allotment in writing.
Further in this thread, you announced that you should have a right to represent your company in litigation. That's absolutely ridiculous, and in criminal matters in the United States, is dissonant with the Sixth Amendment. In such cases, the corporation has a right to assistance from counsel. Because corporations are fictitious entities incapable of self-representation and thus incompetent, corporate pro se representation is impossible.
But, there are good reasons why a client shouldn't have a right to non-lawyer representation. The Model Rules
of Professional Conduct attach an enormous burden to lawyers by compelling them to disclose to the authorities another lawyer's violation therefrom. Without strong industry self-regulation in this form, there would be no way to protect clients from invidious representation.
As much text as might exist around the subject, it looks like the "blanket prohibitions" aren't working and everyone knows it. There's a small loophole in the rule you describe--what happens if a non-attorney learns of an attorney's misconduct? Nothing, that's what!
It's not ridiculous for me to want to represent my company without having taken the bar exam--you're using a legal fiction to argue that even though I pay my company's taxes, I should not be allowed to represent its interests in court if I so choose. But even if I didn't pay my company's taxes, I would still want that option because the fictitious entity you describe is a creation of my capital and my labor and in every other respect its Board of Directors has the ability to guide its direction.
I don't understand your first point. Nothing precludes a non-lawyer from reporting an attorney's misconduct. However, the fact that they cannot be compelled to by statute irrefutably proves my point: that the practice of law must be (self-)regulated.
Regarding your second, the fact that you pay your company's taxes is irrelevant. "You" can be substituted by any other shareholder or partner; the shareholders/partners are not the corporation. The corporation is its own, independent legal entity. Because it's fictitious, it cannot make decisions, which means (as a matter of law) it's incompetent to stand trial.
Some jurisdictions may have rules deviating from this to allow corporate pro se representation by 100% shareholders in small claims matters, but they would be the exception.
The corporation is its own, independent legal entity. Because it's fictitious, it cannot make decisions, which means (as a matter of law) it's incompetent to stand trial.
I don't follow the logic here. If it's fictitious and incompetent to stand trial, then why it can be brought to trial at all?
> Nothing precludes a non-lawyer from reporting an attorney's misconduct. However, the fact that they cannot be compelled to by statute irrefutably proves my point: that the practice of law must be (self-)regulated.
Failure to report a crime is a crime. For everybody.
Irrelevant. Violation of a legal obligation is not the same thing as commission of a crime. An act may simultaneously be a violation of legal ethics and a crime, but usually not. Ethics violations are punishable by, amongst other things, civil sanctions, fines and disbarment, but not criminal penalties.
And, just to be clear, lawyers' fees are reasonable because lawyers have a duty to report fraudulent billing practices. If they don't, they can be disbarred. That duty to report covers all of the rules (excluding Rule 1.6 and information gained by lawyers participating in approved lawyers' assistance programs), and the reasonableness of fees absolutely includes consideration for this duty.
What about law firms with a single lawyer and the rest associates. Nobody reports anything. Lawyers round billing, type 5 words per minute, templatize their documents but charge as if writing from scratch, and play the system in many ways, double bill for multitasking status hearings, and so on. I would be more than happy to pay the billing rate if they actually worked those hours.
What do you mean by associates? Do you mean non-lawyers engaging in document preparation? If so, they might be criminally liable for the unlicensed practice of law. If they're also licensed attorneys, then again, you're paying for the firm's time, not a single lawyer's time. If a partner tells an associate to do something against the rules (i.e., superior tells subordinate to act illegally), "the subordinate is bound by the Rules of Professional Conduct notwithstanding that the lawyer acted at the direction of another person." (Rule 5.2(a)). The only exception is if it's an "arguable" question and the superior's instructions were reasonable in light of this.
For non-lawyer assistants, (see Rule 5.3), the lawyer must make reasonable efforts to ensure that the non-lawyer's work complies with the professional obligations of the lawyer. This mostly applies to cases when a non-lawyer assistant is sorting through documents and accidentally loses one that's later found by the media. Again, if they're doing anything that's the practice of law, they're committing a crime. The subordinate would be criminally liable, and the supervising lawyer would be professionally liable under Rule 5.3.
Associates are lawyers. The difference between an associate and a partner is the same as the difference between an employee and a founder in a startup: the employee gets paid a salary, the founder might get a salary but primarily draws his income from the success of the business.
Paralegals and office staff are not lawyers. Paralegals are allowed, by law, to draft legal documents. However, they cannot offer legal advice, and any documents they draft must be reviewed by a practicing lawyer.
Your opinion that a Wachtell attorney isn't worth >$1,000/hour is immaterial. As a matter of law, what they're charging is not unreasonable, because you're paying for more than the amount of time an attorney spends typing on a word processor. You're paying for the firm's experience and reputation. Moreover, many lawyers would have actual knowledge of the firm's fraud, were it to occur. By not reporting this information, they risk being disbarred and losing their livelihood. I don't generally like to endorse the efficient-market hypothesis, but it appears highly unlikely that there's a giant conspiracy that results in systemic under-reporting and non-enforcement of the rules...
I'm not buying it. There are a lot of reasons that reporting could be just as devastating as not reporting, except it's more likely to happen.
Imagine a James Lawyer at your prestigious $1000/hour partnership. He finds out Joe Partner is up to no good. What are his options?
Blow the whistle, get Joe Partner in trouble, get black-balled (if not outright fired [but, of course, not for whistle blowing]) and eventually (or immediately) have to find a new job. In trying to find other jobs, James finds nobody is interested in him in any capacity remotely near his previous level of employment, because, like any close professional community, everybody knows James is a whistle blower. He eventually has to settle for a position in a local law firm, make 1/3 what he was making before.
Or, don't blow the whistle. If Joe Partner eventually gets caught, James might get caught up in it, or he might be able to skate around it.
Do you really think no lawyers knew about Bernie Madhoff or World Comm or Enron? To say this ethical code of conduct justifies the high prices is laughable.
Lawyers regularly get in very severe trouble for breaches of legal ethics. The Enron, etc, examples aren't availing. Lawyers are required, legally, to rat out other lawyers for violations of legal ethics. They are not required to rat out their clients (and indeed are ethically prohibited from doing so). I'm sure lots of lawyers knew about Bernie Madoff and Enron, etc. But they were legally obligated not to disclose their clients' crimes.
Moreover, in your hypothetical, it's not just James Lawyer who can report the business practice. A judge reviewing a claim of attorneys fees could find something suspicious. An in-house guy reviewing bills could find something suspicious. Somebody at another law firm working jointly on a case could find something suspicious. Those people have no disincentive to report that conduct, and indeed their ass is on the line if they do not.
Do lawyers charge you for time while thinking about your case in the shower? Probably. Like any contractor, there is some margin for estimation while remaining ethical. But is there some grand conspiracy to systematically over-bill clients? There are just too many people who would have access to that knowledge, and who could only get in trouble for not ratting it out for that to be likely.
@SoftwareMaven: I never said "justifies," but I did say it's one factor that contributes to the inherent reasonableness of the fees. My argument is based on the law and professional practice, while your counter-argument is based on a hypothetical, conspiracy theory.
In terms of "institutionalized fraud," you are totally wrong. The legal profession is one of the most heavily-regulated professions that exists today. The duties imposed on lawyers--which are legal obligations to act or refrain from acting--should not be taken lightly. For example, Rule 8.3 of the Model Rules of Professional Conduct[1] (adopted in whole or in part by 49 states) provides:
(emphasis added). Note the word "shall:" it means that a lawyer who has actual knowledge that another lawyer (regardless of jurisdiction!) violated the rules MUST report the violation to the appropriate authority.The reason I explain this rule in particular is because of Rule 1.5, which provides in excruciating detail a lawyer's ability to collect fees from a client.[2] Everything you said is wrong.
Here's the short, plain English version of Rule 1.5: the lawyer must communicate the fee arrangement to the client before the start of representation (except when charging an ongoing client the same rate in subsequent matters). There's a blanket prohibition against "excessive fees" and "minimum fees," and a set of factors used to determine whether a fee is reasonable.
Reasonable fees are judged by time and labor, the issues' difficulty/novelty, the lawyer's experience/reputation/abilities, the nature and length of the lawyer-client relationship, whether the lawyer must turn away other cases, whether it's a fixed or contingent fee basis, and the customarily charged fees. When dealing with contingent fee arrangements, they MUST be reasonable and signed by the client, but may not be used in criminal cases. Similarly in criminal cases, a lawyer may not ask for incentive fees, and is proscribed from taking a percentage of publication rights (i.e. Casey Anthony's lawyer asking for a percentage of any subsequent book deal in exchange for his time) until after all appeals have been exhausted. Contingent fees also may not be used in domestic relations.
When dealing with division of fees in law firms, it's not actually a "division of fees" in the legal sense. The lawyers are salaried employees of the law firm, which is hired to represent the client. Again, when you hire a law firm, you are not hiring a single lawyer; you're hiring the entire firm. Division of fees occurs when a single billing client is covering the fees of two or more lawyers who are not in the same firm. When this happens, division is permitted as long as it's proportional to the services each lawyer (or firm) provides to the client, and the client must agree to this allotment in writing.
Further in this thread, you announced that you should have a right to represent your company in litigation. That's absolutely ridiculous, and in criminal matters in the United States, is dissonant with the Sixth Amendment. In such cases, the corporation has a right to assistance from counsel. Because corporations are fictitious entities incapable of self-representation and thus incompetent, corporate pro se representation is impossible.
But, there are good reasons why a client shouldn't have a right to non-lawyer representation. The Model Rules of Professional Conduct attach an enormous burden to lawyers by compelling them to disclose to the authorities another lawyer's violation therefrom. Without strong industry self-regulation in this form, there would be no way to protect clients from invidious representation.
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[1] http://www.americanbar.org/groups/professional_responsibilit...
[2] http://www.americanbar.org/groups/professional_responsibilit...