FAQs
Q: If not by the hour, how do you bill?
Q: How does your preferred fee arrangement work if there is a settlement?
Q: What happens if you exceed your budget?
Q: Isn’t litigation too unpredictable to set a single flat fee?
Q: Why should I be confident that together we can come up with fair price for my case?
Q: What if, at the outset of a case, we don’t know enough to set a price for the entire case?
Q: Why are your prices so much lower than billable hour practices?
Q: How do you handle "larger" cases?
Q: How do I know you are good?
Q: Why not use an AmLaw 200 firm that has cut its hourly rates or capped its fees?
Q: Why not use the small firm with very low hourly rates?
Q: What about the associated costs of litigation?
Q: If not by the hour, how do you bill?
A: CLP’s preferred fee arrangement is to agree with you on a flat fee for the entire matter, paid on a monthly basis, but with a portion of the fee (for example, 20%) held back from each monthly payment. If CLP does not achieve what you define as a favorable result, you keep the holdback. If CLP achieves a favorable result, you reward CLP by paying a multiple of the holdback (1.5x, 2x, or some other number - the amount is entirely up to you). Under this arrangement, we share with you the risks inherent in litigation, which motivates us to avoid wasting time and resources on things that don't matter to you or your case. At the same time, while you can trust CLP to always give its best effort, the holdback provides additional motivation for CLP to get you the best possible result. “[F]irms devote resources needed to achieve success bonuses”. Patrick Lamb, In Search of Perfect Client Service. Both you and CLP do better if the final outcome is favorable, and both do worse if the final outcome is not favorable.
We also recognize that there is no one alternative fee arrangement that fits all clients or all types of litigation. We use the fee arrangement that best fit your situation: contingency fees of all types, discounted hourly billing with success holdbacks, and flat fee per project, just to name a few. back to top
Q: How does your preferred fee arrangement work if there is a settlement?
A: You pay only the monthly fees that are owed up through the date of the settlement. If, in your sole discretion, the settlement is favorable, you reward us with the amount that has been held back as of the date of the settlement times the multiple you judge to be fair. back to top
Q: What happens if you exceed your budget?
A: We respond the same way you do in your business- we stand by our price. If our budget turns out to be inaccurate, or even if we are not as efficient as we hoped to be in handling your matter, you do not pay more. Only where there is a substantial change in the assumptions or circumstances both of us relied on to come to an agreement on fees, might a modification of the fee agreement (up or down) be necessary. For example, if new claims involving other patents are added to the case, we would agree to negotiate a modification to the fee agreement within the spirit of its terms. back to top
Q: Isn’t litigation too unpredictable to set a single flat fee?
A: Not at all. It is widely accepted within the legal community that litigations of all sizes can and should be conducted on a fixed price basis. For a senior trial attorney, pricing litigation is far easier than many of your business decisions (we are not building a next generation wafer fab or an oil platform in the North Sea). “Lawyers should do what Joe [the contractor] does: identify the client’s objectives, measure, calculate, build in a contingency and come back with a price. Once the price has been agreed upon, the billable hour should be irrelevant.” Senior trial lawyer Evan Chesler, Forbes. A traditional firm that tells you that litigation must be billed by the hour is "[w]rong on the count that we don't know what things cost, and wrong on stilts that lawyers aren't good enough businessmen to set a fair price." Bruce MacEwan, Creator and Host, Adam Smith, Esq. back to top
Q: Why should I be confident that together we can come up with fair price for my case?
A: Our clients trust us to help them get beyond the billable hour and thereby reap the major benefits of using an alternative, flat fee, structure. Our team has decades experience as equity partners in premier national intellectual property practices developing accurate budgets for complex intellectual property litigations worth hundreds of millions of dollars. We apply that experience in extensive pre-engagement due diligence making a detailed early assessment of your case and the likely associated fees and costs. We also use our experience to identify benchmark litigations in our history, your history, or both, that most closely replicate the case at hand; from there we adjust for case specific circumstances, e.g., opposing counsel, the judge, the expected case schedule, specific legal principles or evidentiary rules that may apply under the circumstances, etc. We are highly incented to get the case assessment right because we bear the risk of getting it wrong. Unlike billable hour firms, we do not have the luxury of getting paid for a poorly developed case strategy. back to top
Q: What if, at the outset of a case, we don’t know enough to set a price for the entire case?
A: For reasons discussed above, we are confident that we can arrive at a mutually agreeable price at the outset of the case. Nonetheless, on the rare occasion where either you or CLP requires more information, we will provide you with our proposed fees and costs for an initial, strategically significant, phase of the matter, typically in the range of 3 to 6 months. We will charge a flat fee during this initial phase, with the expectation of proposing, upon completing the initial phase, a mutually agreeable flat fee arrangement for handling the rest of the case. This arrangement allows both you and CLP to move forward in a timely fashion, and at the same time provides the additional information necessary to arrive at a mutually agreeable price for the remainder of the matter. back to top
Q: Why are your prices so much lower than billable hour practices?
A: "The traditional business model in which law firms leverage layers of high-priced junior lawyers who bill by the hour... gives lawyers an incentive to work inefficiently." Ameet Sachdev, Chicago Tribune. In comparison, CLP employs small teams of former equity partners from top IP firms who are better, faster and more efficient than any associate or junior partner could hope to be. By setting a flat fee, you cap your risk and CLP has an incentive to win now, rewarding strategic lawyering, not hours. This model drives a lower cost of production, enabling us to lower prices by at least 20-30% (Jay Sheperd, The Client Revolution) and maintain a motivating margin.
Further, while CLP preserves and improves upon the aspects of our former practices that deliver results, we also eliminate the unnecessary big firm overhead that increases bills but does not provide value to you:
- Bloated associate salaries incommensurate with skill or experience – we assemble customized teams of senior partner lawyers on a case-by-case basis for one flat fee.
- Attorneys and staff on salary waiting for a big case – we utilize on-demand access to talented litigation lawyers and litigation support services, allowing us to scale for the largest litigations so you pay only for the talent your case requires and not redundancies or dead weight.
- Inefficient In-firm review and e-discovery services – we leverage e-discovery know how and relationships with vendors who provide these process-focused services faster, more accurately and more securely than distracted associates or in-firm departments. back to top
Q: How do you handle "larger" cases?
A: The truth is, all cases, even "large" intellectual property litigations, are best handled by a small team of senior, experienced, trial attorneys.
"[B]ased on our experience (which includes over $20 B in legal fees), you will be pleased to know that there is strong support for [the] proposition that cases are most cost effectively handled by small teams, often teams of one, and that the optimal staffing profile includes what can best characterized as junior partner level attorneys." John Weber, CT TyMetrix, Legal OnRamp.
"3 highly experienced partners will always do a much higher quality job than 20 associates, 4 junior partners, chief trial lawyer, etc WHY? Because it makes no sense to have people preparing a case for trial who have never seen a trial. Such novices will always waste huge $$$ doing "projects" that will never see light of day at trial or change anything." Fred Barlit, Legal OnRamp.
CLP assembles a team customized for your case. We take advantage of strategic partnerships to select experienced trial attorneys with expertise and specialization in the technologies and issues related to your case. When opposing counsel tries to drown us, and their own clients, in voluminous data, we have the bandwidth of 50-lawyer Hoge, Fenton, a respected Silicon Valley business law firm. For discovery issues, we leverage years of managing complex e-discoveries for large firms, to optimize relationships with expert consultants who deliver secure, efficient and cost-effective solutions to your collection, storage, processing, review and production needs. We can easily handle large cases. back to top
Q: How do I know you are good?
A: The best predictor of future success is past success. CLP attorneys are experienced trial attorneys with lengthy track records of success in high value complex IP cases. We are graduated from the best law schools and IP practices in the nation. And, of course, if you do not already know our reputation for excellence, read what our clients have to say about CLP. back to top
Q: Why not use an AmLaw 200 firm that has cut its hourly rates or capped its fees?
A: Because your case would be the lowest of all life forms in BigLaw - the case which is not making any money. Under the circumstances, you have no realistic expectation of receiving the talent and attention your case deserves.
A lot of large law firms are trying to win back or hold on to disgruntled clients by dropping hourly rates or capping hourly fees. However, the cost to these firms of delivering legal services remains extraordinarily high, several hundreds of thousands of dollars per lawyer, and the firms have failed or are unable to develop more efficient and effective delivery systems.
“[P]eople are going to have to turn their attention to the operating model and begin addressing real issues associated with delivering valuable service and legal product at acceptable prices to clients, for a COST OF DELIVERY that is much lower than today so that a reasonable level of compensation may be earned, for a quality of life that is worth living. NOTHING in what is being done now appears to address any aspect of that.” Edwin Reeser, Legal OnRamp.
The firms therefore cannot generate any profit on these cases. They assign their most talented and productive lawyers to profitable “full freight” hourly cases, while their discount cases are handled by less motivated, less experienced and less capable attorneys making reduced compensation. back to top
Q: Why not use the small firm with very low hourly rates?
A: So you’ve found a small group of lawyers who will give you more attention and bill low hourly rates? Everything’s great, right? Wrong. Hourly billing sells hours, not results. Whether done by large or small firms, and whether the rate is high or low, hourly billing rewards inefficient conduct, drives work to the least qualified lawyers, and subjects you to repeated surprise cost overruns.
On the other hand, “by basing their prices on the client's value on solving a problem and by setting those prices up front, [alternative fee] firms work more effectively without all the waste caused by hourly billing and its related systemic problems”. Jay Sheperd, The Client Revolution.
And don’t assume your small firm “trial“ attorney has ever tried a case before, let alone handled a multi-million dollar patent or IP litigation against a litigation savvy adversary with a war chest. Your company cannot afford the drop-off in quality from senior, experienced and successful intellectual property litigation attorneys. back to top
Q: What about the associated costs of litigation?
A: Your total price includes both the fees for legal services plus the costs (aka “disbursements” or “expenses”) incurred in providing these services. CLP includes as much of the costs as possible into our flat fee. When this is not practical, CLP provides an upfront estimate of the amount of the costs broken out according to the predicted case schedule. Learn more about how CLP handles costs.