Recent headlines reveal that that big Southern California law firms are charging upwards of $1800-2500/hour for their services.
“Eye-watering rates are nothing new for Big Law firms, which typically ask clients to pay higher prices at least once a year, regardless of broader market conditions. “Value is in the eye of the beholder,” said John O’Connor, a San Francisco-based expert on legal fees. “The perceived value of a good lawyer can reach into the multi-billions of dollars.”
As a long practicing attorney with a quarter century of experience, I can remember when $500/ hour sounded outrageous. When I was in-house counsel, regularly hiring some of these big firms for specialty work, I would have been horrified to see such hourly rates. Even my large real estate developer, energy conglomerate and major franchise clients would not have been willing to pay such rates. Most importantly, many deals would not “pencil” if legal fees were coming in at $2000/hour.
That is not to say that some of these attorneys don’t earn their fees- because believe me, they do. Especially those who have decades of experience and skill in their field. In fact, it appears that the author of that article has pulled this $2000/hourly rate information from bankruptcy court filings. Chances are, attorneys charging these rates are highly experienced, highly specialized, bankruptcy attorneys, working on vast, complex bankruptcy cases. There are not many lawyers who do that kind of work, and therefore such hourly rates may be a simple matter of supply and demand.
Reasonable explanations aside, most businesses (large or small) cannot afford such legal rates, but may still need experienced, reliable legal counsel.
Faced with the idea that paying for reliable, experienced legal counsel might cost more than a transaction is worth, I have no doubt that many small to mid-sized businesses might make the difficult and risky choice to forego legal counsel when they truly need it.
Luckily for small to mid-sized businesses in California, there are still reasonably priced attorneys out there, and if you are reading this post, the you have found one. Furton Legal offers the services of a truly experienced, reliable business attorney, one who that has gone toe-to-toe with many of these Big Law Firms, and will work for you for a fraction of their fees. Contact us to discuss your transactional needs and our rates.