Why Big Firms Don't Work

As set forth in detail on our Profile page, a traditional, large law firm is by definition in a conflict of interest with its own clients. But this conflict is exacerbated by the counter-productive tactics that large law firms seemingly feel compelled to engage in.

This page is a work in progress. We will be using this page to gather together "war stories" about the tactics used by large firms, and the price that their clients pay as a result. Here are just a few of the stories we have gathered so far:

Shepard, Mullin reaches "deep outer space" with its over billing.

LOS ANGELES - The law firm of Sheppard Mullin Richter & Hampton was caught yet again, seriously inflating its legal fees.  Los Angeles Superior Court Judge John Shook said that Sheppard Mullin was not entitled to the $1 million it billed the City of South Gate on a relatively simple criminal defense matter. 

"The court finds that the fees charged the City by Sheppard Mullin were more than excessive and unreasonable transcending beyond the stratosphere into deep outer space," Shook said in a highly critical 18-page ruling.  Shook said Sheppard Mullin engaged in "unreasonable and unnecessary measures" to defend the case.  The judge concluded that Sheppard Mullin overstaffed the case with inexperienced attorneys, pursued misguided litigation strategies and sent South Gate confusing and redacted legal bills.

So much for professional courtesy.

The counter-productive, poor attitude of big-firm lawyers was beautifully illustrated by a voicemail message that has made its way around the Internet.  In the voicemail*, Winston & Strawn associate Ankur Gupta (see photo) criticizes opposing counsel concerning proposed changes to a joint document prepared in a real estate deal.  In the message, he states:  "If you send one more f---ing e-mail message again, I can assure you your life on this deal is going to be very unpleasant . . . . Whether you consider it material or not, again, I don't give a flying f---. Make the f---ing change."  (* Be aware that the voicemail is much fouler than what we have quoted here, so listen at your own risk.)

"A culture of gamesmanship and flagrant disregard to the court's orders."

You can only push a judge so far.  After witnessing law firm Gibson, Dunn & Crutcher engage in what he described as a "culture" of "obstruction, gamesmanship and flagrant disregard to this court's orders," U.S. Magistrate Lawrence O'Neill fined the firm $102,078.97 for unprofessional conduct and abuse of the discovery process.  GD&C represents a company called EnCana, which is being sued by Gallo Winery for fixing the price of natural gas.  Judge O'Neill held the firm fully responsible for the misconduct and ordered GD&C to pay the sanctions, not EnCana.

At about the same time a judge in Orange County Superior Court was also hammering GD&C for its discovery tactics.  Judge Geoffrey T. Glass (one of our favorite judges since his ruling in Pallorium, Inc. v. Jared) held that GD&C client KPMG had "deliberately or recklessly withheld or delayed in producing many responsive documents in order to gain an unfair advantage."  While KPMG was sanctioned only $30,000 -- a mere pittance compared to EnCana case -- the far heftier price will come at the time of trial.  Judge Glass will instruct the jury about KPMG's failure to produce documents and instruct the jurors that they can consider those actions when deciding the lawsuit.  Cheryl D. Justice (see photo) was the GD&C partner assigned to the KPMG case.

Whatever the cost, fight the (not so) good fight.

By all means an attorney should vigorously advocate his client's position.  But some firms never learn that you aren't doing your client any favors if you insist on fighting about everything.  This story illustrates the folly of pointless fights, and shows why litigation can get so expensive.

So what if we lost?  Give us our attorney fees.

Speaking of expensive, a Cincinnati law firm, working with a San Diego firm, spent nearly three times the amount defending an action compared to what we spent prosecuting the action.  Our client was seeking $550,000 in actual damages, and defense counsel billed their clients $350,000 to unsuccessfully defend the case.  At this point, one would expect them to reassess the wisdom of the defense and possibly talk settlement.  Not so.  They went right on bringing unsuccessful motions.  In fact, despite the scathing loss, they brought a motion for attorney fees claiming that defendants were somehow the prevailing party.  You can imagine how well they did with that motion.  

The $2,000 "Hissy-Fit"

Read how a large Los Angeles firm spent almost $2,000 of its client's money in order to recover $23.

"Everyone is Entitled to Our Opinion"

Having learned nothing from the above $2,000 hissy-fit, the same firm billed its client an estimated $10,000 to bring a motion for summary judgment.  They argued (unsuccessfully) that based on nothing but the opinions of their own clients and witnesses, the case could be decided without a trial.

"Why take 30 minutes to do the easy thing when you can bill the client 12 hours for the same result?"

When opposing counsel served unintelligible interrogatories, we offered to answer them within the week if he would just put the questions in proper form.  Silly us.  Why would he spend 30 minutes rewording the questions so that he could have the answers in a week when he could instead bill the client some $5,000 for a motion to compel and get the answers in two months?

"We won't! We won't, we won't, we won't!"

There were two defendants in the action in question, and although one defendant accepted service and answered the complaint, the other defendant challenged the service as improper.  The plaintiff's attorney could have simply served the complaint on the recalcitrant defendant, but chose instead to fight the issue month after month after month.

Another trip to the woodshed for Shepard, Mullin over attorney fees.

What to do when there is no basis to recover attorney fees?  According to Sheppard Mullin, you bring a motion anyway, failing to offer any competent support for the motion.