A judge in another state recently rejected a $464,000 fee request by a large law firm, accusing it of “gold plated lawyering” in what should have been a straightforward case. Although this isn’t technically a legal malpractice case, it raises the interesting question of when a fee can be considered wrongful if it is supported by actual work.
It is possible for fees and billing problems to rise to the level of malpractice or fraud, or to result in sanctions against the attorney. Such cases generally involve billing in excess of the actual work performed. For example, a lawyer who bills for more than 24 hours in a single day can face discipline, as can one who pads bills with exaggerations about the work actually performed.
In this case, the lawyers worked all the hours they claimed on their bill and their hourly rate was considered reasonable — they simply did more legal work than was actually required.
The law firm, Greenberg Traurig (GT), represented a co-op that had been sued over its decision to begin using a valet parking system. It achieved a dismissal in the case, however, because the lawsuit had been filed too late.
The fact that the plaintiffs had missed the filing deadline was entirely sufficient to win the case. Instead of focusing on that issue, however, GT prepared a lengthy response to apparently unfounded allegations of impropriety for which the plaintiffs had sought sanctions.
The judge noted that GT’s court papers “are long, and they are beautiful: well-organized, well-written and well-reasoned” and that it had brought in two partners to litigate as well as it did. “But another approach could have achieved the same result,” he wrote. “The partner in charge could have walked out into the hallway, grabbed the first mid-level litigation associate that walked by, and said, ‘Our client is being sued; it’s untimely; get it dismissed.'”
The judge went on to say that he was “troubled, almost haunted, by the idea of awarding almost half a million dollars to attorneys who simply prevailed upon a court to dismiss an untimely proceeding.”
Instead of the $464,000 GT requested, the judge awarded only $175,000 in fees.
It’s not fair to say that GT padded its bill. It performed all the work it said it had and, as the judge noted, performed it well. The firm commented to reporters that it disagrees with the judge’s characterization.