Killing The Billable Hour: Cravath And Me

Evidently the chairman of America’s most august law firm agrees with me. In an essay published in the December 25, 2008 issue of Forbes, Evan Chesler, the managing partner at Cravath Swain & Moore, essentially calls for the end of hourly billing. While I find certain particular points in Mr. Chesler’s piece either silly (such as his referring to himself as a “trial lawyer”) or disputable (its not clear to me, for instance, that the billing regimen that Mr. Chesler endorses is really all that radical a departure from the hourly billing), I appluad his willingness to embrace new ways of thinking about fees. As I have said previously, hourly billing is pernicious in that it creates incentives for lawyers that are in direct conflict with their clients’ interests, i.e., the cost efficient resolution of their problems. Alternative fee arrangements, including contingent or partial contingent fees, flat fees with success premiums and the like, bring the lawyers’ incentive structure more into line with the client’s interests.