Clients Unbundling Legal Services to Control Spending, Paper Claims

Federal procedural changes and market forces are reshaping legal norms, resulting in clients unbundling legal services and reduced attorney authority, according to a new academic paper.

Morris Ratner, a professor at the University of California Hastings College of Law, writes in “Restraining Lawyers: From ‘Cases’ to ‘Tasks,’” that “Recent developments in the domains of procedure and private contract highlight a continuing shift of authority away from lawyers and to courts and clients eager to control litigation costs.”

The Business Trial Group is a leader in the trend towards value-based pricing.

These changes, suggests Ratner, “suggest the possibility of the emergence of new professional norms that call on litigators to think more deeply and inclusively about value from the perspective of court and client when making litigation choices.”

The paper notes some firms’ shift to value-based pricing, including alternative fee arrangements such as a contingency-fee model.

As the nation’s only contingency-fee complex business litigation firm, Morgan & Morgan’s Business Trial Group is at the forefront of the industry trend towards value-based pricing, offering our clients outstanding representation with no hourly fees.

Federal Procedural Changes

The federal judiciary is one half of the “pincer-like” effect of public and private changes reshaping litigator norms.

Under pressure to conserve limited judicial resources stretched thin by traditional lawyer-driven adversarialism and lengthy discovery, the Federal Rules of Civil Procedure have increasingly endowed judges with case-management authority.

This has resulted in judge’s inserting themselves more into litigation choices, with an eye towards controlling the expense and time demands of litigation. For example, Ratner says, judges are increasingly involved in case management, requiring that lawyers focus more on costs versus benefits during pretrial activity such as discovery and filing motions.

Litigators and litigants, Ratner says, are more likely to encounter “trial court judges who intentionally arrange the constituent elements of litigation with a focus on value and conservation of resources.”

Market Forces

The second prong of the pincer movement inspiring new litigator norms is client demand for value-based legal services.

Changes in legal services pricing based on project and information management, says Ratner, have allowed consumers to shift legal tasks from “cases” to “tasks” and source projects to cost-efficient providers.

Relatively soft legal services demand and more practicing lawyers has created increased competition that favors consumers. This buyer’s market for legal services, coupled with platforms like Legal Zoom, which provide low-cost routinized services, allows clients to disaggregate litigation into tasks performed by several (lowest cost) providers, rather than a single firm.

Market forces have also led to consumer demand for novel legal services pricing. Providers have responded by offering value in the form of budgeting and “alternative fee arrangements” (i.e. flat fee pricing, discounted billing, and contingency fees).

Small Businesses May Not Benefit From Changes

However, Ratner points out, “sourcing, budgeting, and/or manipulating counsel’s incentives via fee arrangements, typically occurs in those cases where clients are sufficiently sophisticated and have sufficient leverage.”

Unbundling is rare in complex, high-value litigation.

Unbundling may be appropriate for large corporate clients with large budgets and ongoing legal needs. But for individuals and businesses involved in complex, high-value litigation, unbundling is rare.

It is also impractical when going up against a much better-funded opponent who can afford the high hourly attorney fees that, despite judicial and market changes, still dominate the legal field.

Contingency-Fee Business Litigation

Research shows that growing litigation costs have reduced law firm clients’ appetite for litigating a case all the way to trial. Yet a trial is often the only way to achieve justice.

With contingency-fee litigation from the Business Trial Group, you don’t have to worry about being outspent by an opponent and forced into accepting a suboptimal settlement.

We understand that a single legal dispute can make or break your business, which is why we charge no-upfront legal fees, and no legal fees at all if we don’t win your case.

For a free case review, please contact the Business Trial Group.