The Law: Attorneys’ Fleece

Some potential dangers of “loser-pays”

If a lawyer hired to handle a $50,000 damage claim won and then submitted a bill to his client for $1 million, the client would be entitled to rip up the bill and report the lawyer to disciplinary authorities. Everyone would agree that such an excessive fee is patently unreasonable, even unconscionable. Unless, of course, the attorneys’ fees are not being paid by the client, but are being awarded by the court against the losing party, pursuant to a fee-shifting statute. In that case, the lawyer might get not only the $1 million he asked for, but a bonus of $650,000 and an additional recovery of $200,000 in fees for time spent arguing over fees.

It happened. In a little-noted finale to the widely publicized sexual harassment case Weeks v. Baker & McKenzie, the trial court in San Francisco awarded Rena Weeks $1.8 million in attorneys’ fees—1.7 times the actual hours her lawyers spent on the case multiplied by a prevailing hourly rate—even though the jury awarded her only $50,000 in compensatory damages. (The $6.9 million punitive damages verdict, reduced by the judge to $3,725,000, is on appeal.) In sexual harassment cases, as with other types of employment discrimination suits, the prevailing party can recover reasonable attorneys’ fees from the losing party.

Read More at Reason

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