Where the Client Bears the Risk, the Client Should Gain the Reward
Attorneys are frequently overcompensated in circumstances where they subject themselves to little financial risk and invest little effort in a case. Someone pays for this unearned benefit. Usually, that someone is the client. Class action lawsuits are frequently the setting for such abuse. In one prominent case, the recent Cox Enterprises buyout of minority shareholders, the Delaware Chancery Court reviewed the plaintiff’s counsel’s request for fees and stated, "I can discern no appreciable risk taken by the plaintiffs’ lawyers." The Court then dramatically slashed the attorney’s fee award. The lawyers in that case has sought what amounted to more than $2,000/hour. The lesson? It pays to carefully review requests for payment of attorney’s fees and, where appropriate, challenge such requests on the basis of the attorney’s undertaking of time and financial risk.
