Posted Jan 10, 2013 02:13 pm CST
Law firms are reaping more in legal fees, likely because of rate increases and clients willing to pay top dollar for the best legal talent, according to a study of legal spending data.
Legal fees for 37 companies studied were nearly $950 million for the first two quarters of 2012, a 14.7 percent increase compared to the same period in 2010, the Am Law Daily reports. Yet billable hours increased only 1.2 percent for the same period. “Even if clients weren’t buying many more hours, they were paying a good deal more for the privilege,” the story says.
The Am Law Daily analyzed information provided from legal billing company TyMetrix for its story. The data came from eight companies in the Fortune 100, eight in the Fortune 101–500, and 21 other “substantial” corporations.
Large law firms are benefiting from high-priced talent who charge at least $800 an hour, according to the data. America’s top 200 law firms dominated this “high-rate fees” sector, with an 85 percent share of the total. In last year’s first two quarters, this sector accounted for 14.3 percent of the hours purchased from Am Law 200 firms and 23.8 percent of their fees.
For the same period in 2010, the sector accounted for 12.2 percent of BigLaw hours and 22.3 percent of its fees. “For the right talent, price is not the problem,” the story says.