Top Lawyers Bill $1,000 an Hour

Lawyer Pay

Posted Aug 22, 2007, 09:53 am CST
By Debra Cassens Weiss

Lawyers at some of New York’s top firms are billing $1,000 an hour.

The move was a reluctant one for some law firms, the Wall Street Journal (sub. req.) reports. "We have viewed $1,000 an hour as a possible vomit point for clients," a partner at one New York firm told the newspaper.

Firms that have hit the four-figure mark for top partners include: Simpson Thacher & Bartlett; Cadwalader, Wickersham & Taft; and Fried, Frank, Harris, Shriver & Jacobson. The Wall Street Journal’s Law Blog ran photos of the top billers and proclaimed them members of a new elite fraternity: the Law Blog Thousand-Dollar Bar.

Barry Ostrager of Simpson Thacher says he’s worth the high price. "I haven't personally experienced resistance to my billing rates," he told the newspaper. "The legal marketplace is very sophisticated."

Some clients agree. Mike Dillon, the general counsel of Sun Microsystems Inc., says the pay is lower than that of major league baseball players, who make the equivalent of $15,000 per hour. “One thousand dollars for very seasoned lawyers who can solve complex problems doesn't seem to be inappropriate," he told the newspaper.

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Posted by Brandon Forgione - 1 year, 3 months, 1 week, 2 days, 8 hours, 56 minutes ago

wow!
Posted by Linda Dominguez - 1 year, 3 months, 1 week, 2 days, 8 hours, 6 minutes ago

OMG, how much experience is sufficient to warrant that kind of hourly rate? And to compare an attorney to a sports player seems a bit ridiculous to me. Professional players have extremely short careers whereas an attorney can conceivably have a career spanning 30 or 40 years.
Posted by Suzanne - 1 year, 3 months, 1 week, 2 days, 7 hours, 46 minutes ago

Wow! I knew going to law school was a great idea!
Posted by Stanton Cobb - 1 year, 3 months, 1 week, 2 days, 7 hours, 30 minutes ago

Now I KNOW I’m not charging enough! Note to self: review retainer agreement.
Posted by Mr. Pug - 1 year, 3 months, 1 week, 2 days, 6 hours, 59 minutes ago

The fact that professional athletes have short careers doesn’t mean lawyers shouldn’t be able to bill at $1,000/hr or even much higher. Plenty of athletes and entertainers have very lucrative careers after they retire. People should be able to pay what they want to for services they deem worth their money. I find nothing exceptional about billing $1,000 an hour if the perceived results warrant it - and they obviously do. Many companies and wealthy individuals pay much higher premiums for other products and services that could be considered much more trivial than expert, experienced, specialized, and efficient legal advice, which is what top lawyers are providing.
Posted by Jennifer - 1 year, 3 months, 1 week, 2 days, 6 hours, 55 minutes ago

The market will pay what the market feels an attorney is worth. If a firm and/or attorney is able to provide a service that a client is willing to pay $1,000.00 an hour for then an attorney should be able to collect said amount. Its called capitalism!!
Posted by H.P. - 1 year, 3 months, 1 week, 2 days, 6 hours, 47 minutes ago

Almost all clients of firms like Simpson Thacher are major multinational corporations that are highly sophisticated purchasers in the market for legal services. If they feel a particular project is worth $1000/hr they will pay it, if not they will negotiate a discount or take their business elsewhere. At the end of the day, legal fees—even $1000/hr legal fees—are lost in the rounding errors of the multi-million (or -billion) dollar transactions in which these clients are participating.
Posted by Neal Taslitz - 1 year, 3 months, 1 week, 2 days, 6 hours, 46 minutes ago

And we all wonder why the quality of judges seems to be less than it was when law was considered to be a profession and not a business.
Posted by pfreans - 1 year, 3 months, 1 week, 2 days, 6 hours, 14 minutes ago

The challenge for we lawyers is not striving to achieve those rates, but to do equally or better job for our clients at a lower price. Yes this is a capitalist system, and the above clients who are willing to pay $ 1000 per hour will certainly be willing to pay me $ 900 for similar work. Let the competition begin….
Posted by A.T. - 1 year, 3 months, 1 week, 2 days, 5 hours, 35 minutes ago

“OMG, how much experience is sufficient to warrant that kind of hourly rate? And to compare an attorney to a sports player seems a bit ridiculous to me”

Ok, then go compare $1000 an hour to a medical practitioner and see what you come up with. Same general level of experience, same general number of “earning years”, but top MDs charge significantly more than this
Posted by Howard Liebman - 1 year, 3 months, 1 week, 2 days, 5 hours, 33 minutes ago

Ms. Dominguez may have lost track of the time value of money. No starting lawyer willl be charging $1000 per hour, and I guess it will take even the superstars 20-25 or more years to reach that figure, whereas sports figures will be charging, effectively, the amounts mentioned from the get go, or at most after a few years. With compounding, the sports or entertainment figure will—if they are are wise in how they spend and invest—come out way ahead, even if they only work at their profession for 10 - 15 years.
Posted by Motty Stone - 1 year, 3 months, 1 week, 2 days, 5 hours, 31 minutes ago

$1000/hr times 2000 hrs/year is a 2 million dollar annual income. Obviously that’s not how the pay structure works for some of these top guys, but in perspective: the board members of major corporations make more; top performers in (say) professional sports make more; top actors and entertainers make more; mid-size and large business owners make more.. . these lawyers are obviously viewed as the best in their field and they still don’t make as much as the top attorneys based on this hourly rate. I think its amazing what people will pay for a lawyer these days, but I don’t think its out of step with other professionals.
Posted by Deb - 1 year, 3 months, 1 week, 2 days, 5 hours, 22 minutes ago

For that rate, you better perform like a major league player and be on your game. But I question the analogy. if major league players are rewarded for performance through their pay scale, they are also punished for their failure to perform. If they don’t deliver, their career is over, literally over.

What happens if a lawyer does not obtain the result? Does he refund his client the fee? Is his hourly rate reduced? Is his career over?

If you feel you are worth that much and can compare yourself to a major league baseball player, you sure as heck better solve the problem or perform to the standard you are holding out for yourself. There is little room for error.
Posted by John Mitchell - 1 year, 3 months, 1 week, 2 days, 5 hours, 9 minutes ago

The title of this story should have been “Greediest Lawyers with Most Inefficient Clients Bill $1,000 an Hour”. In today’s America, where the wealthy become that by enlarging the ranks of the poor, suppress wages and deny social benefits to those unable to pay, any lawyers billing $1,000 per hour are doing to only because the lawyer’s clients let them get away with it. They and their clients are in the same league as the folks plundering the public wealth by scratching each others’ backs in the White House, the oil industry, the so-called defense industry, and those others in which corporate profit is pursued and glorified over individual rights to life, liberty and the pursuit of happiness.
Posted by Lynda Gilbert - 1 year, 3 months, 1 week, 2 days, 5 hours, 7 minutes ago

If we would quit billing by the hour, this could be a non-issue. Don’t some lawyers flat bill projects and average much more than this?
Posted by M Martin - 1 year, 3 months, 1 week, 2 days, 5 hours, 4 minutes ago

Should an attorney who bills by the hour make less than one who wins a big class action lawsuit? Is he worth any less to his clients?
Posted by Law Student - 1 year, 3 months, 1 week, 2 days, 5 hours, 4 minutes ago

but this is only a very small percentage of lawyers. I am a 3L, and I will be looking at around 35-40k per year, not one thousand per hour. This is only for people who are the top of their specialty, and not everyone will pay it.
Posted by Prudent Consumer/Investor - 1 year, 3 months, 1 week, 2 days, 4 hours, 49 minutes ago

Mental note to not buy anything associated with Sun Microsystems, especially their stock. But at the end of the day, I do agree that the proper price for an attorneys time is the what the market will provide. So, what is the check on attorneys over-billing like this? See the first sentence of this post.
Posted by H.P. - 1 year, 3 months, 1 week, 2 days, 4 hours, 38 minutes ago

But John Mitchell (#14), your argument is self-contradictory. The general counsels at the client corporations who are hiring these law firms can either 1) value profit above all else, or 2) be willing to waste their companies’ money (and thereby reduce profits) by overpaying their outside counsel cronies—but not both.
Posted by LadyEsquire - 1 year, 3 months, 1 week, 2 days, 4 hours, 33 minutes ago

Motivation to get the class action pipeline going!
Posted by NW Judge - 1 year, 3 months, 1 week, 2 days, 3 hours, 42 minutes ago

So, if capitalism permits top lawyers to be paid $1,000 per hour, how much should top judges be paid?
Posted by Stephen Greetham - 1 year, 3 months, 1 week, 2 days, 3 hours, 32 minutes ago

Well, if the Defense Dep’t is “willing” to pay nearly $1 million for a couple of washers you can get at Home Depot for less than a quarter, I guess one shouldn’t blink at this.

The comments about capitalism are, of course, accurate. Law is now a business, and if the relevant market (i.e., wealthy clients) will support astronomical prices for labor units (i.e., lawyers), then so be it. The real issue is the decadence and wealth concentration that such rates suggest.

But what do I know. I work for relatively poor clients, not multinational corporations.
Posted by John Mitchell - 1 year, 3 months, 1 week, 2 days, 3 hours, 27 minutes ago

H.P. (#19), your argument assumes that “overpaying” outside counsel is inconsistent with valuing profit above all else. As you know, management of for-profit corporations is obligated by law to value shareholder profit above all else. Just as they cannot give to charity unless it serves the interest of indirectly increasing shareholder profit, they cannot legally overpay outside counsel unless such “overpayment” is indirectly buying something more than the level of legal services they could buy at a much lower price. It is quite obvious to me that they are buying the membership fee in the elite good ol’ boy’s network that keeps sucking up the national wealth into the hands of the top 1%. $1,000/hour buys access, influence, golf outings, and so on—just among us friends.
Posted by Doneil - 1 year, 3 months, 1 week, 2 days, 3 hours, 23 minutes ago

Now just a minute here. We’re forgetting some fundamental facts. You know that when those Kilobuck Counselors get paid they give most of that money to some charity, and their office staff is always well paid and given full medical benefits. Naturally, just because you make $1000 an hour doesn’t mean you stop driving a modest American car, living in a small apartment, and drinking domestic wine. After all, just what kind of people are we anyway - CROOKS?
Posted by H.P. - 1 year, 3 months, 1 week, 2 days, 3 hours, 18 minutes ago

NW Judge (#21): therein lies the problem; many of the best candidates for the federal bench are partners at these kinds of firms, who are not willing to take the 90% paycut involved. But the government can’t, whether fiscally or at least politically, justify paying judges the kind of money it would take to lure top lawyers away from private practice.

The interesting thing is that the very lawyers whose salaries have brought about this situation are hurt by the diminishing quality of the federal judiciary, because it lowers the quality (and thus predictability) of dispute resolution available to their clients.

Perhaps this is one more reason that corporations are abandoning the inefficient dispute resolution available in the public courts in favor of arbitration, before private “judges” who are paid at market rates.
Posted by Mr. Texas - 1 year, 3 months, 1 week, 2 days, 3 hours, 9 minutes ago

If a lawyer does not perform to the desired level, then he/she can and usually does get fired by the client. Or, even worse, their reputation among the multi-million dollar bonus getting CEO’s and Directors that make the hiring call for their businesses’ legal needs will smear their reputation a bit—i.e., that firm is not worth the money. Don’t ever think that a lawyer can’t get in trouble…their is legal malpractice which all lawyers are susceptible too. And as far as those that think law should NOT be a business…it is, and if you don’t like business then law might not be for you. Even those that are more “self-less” and work for public defenders’ offices or the D.A. or any other legal aid service have to deal with the bureaucratic non-sense that is government budgeting. That is why so many flee the goverment ranks after a few years to the private practice. If someone will buy it, then let them pay for it—It’s the American way.
Posted by Dominic - 1 year, 3 months, 1 week, 2 days, 3 hours, 1 minute ago

The only reason people have an issue with this is because it’s an hourly rate. Defense lawyers are stuck with this metric because it’s how the industry functions. As someone pointed out, a Plaintiff’s lawyer can make 50 times that amount in settling a big case. That raises its own issues.

Here’s another example - a real estate broker in LA during the housing boom a few years ago could sell a 3 million house without even trying, and collect a $90,000 commission in the process. That works out to about $30,000 per hour, and I guarantee you that person has nowhere near the talent (or the added value to the transaction) or a Major League athlete or an experienced litigator. He also needs no education and no more training than a 2-week real estate course.
Posted by rkj - 1 year, 3 months, 1 week, 2 days, 2 hours, 45 minutes ago

If you think that’s a lot, think again. Remember it isn’t all profit. Out of that hourly fee, a secretary and/or paralegal gets their salary, and some of it goes to rent. All of these are pretty expensive in NYC. For that matter, so is just parking a car.

My educated guess is that a NYC lawyer that charges twice per hour what one does in say, Kansas City, is probably going to live a similar lifestyle on their days off (which one is probably more likely to actually have in KC).

They might be (and probably are) better lawyers for the matters they take on, but at the end of the day, $1,000 in NYC isn’t near as much money as it is in St. Louis.
Posted by Matt - 1 year, 3 months, 1 week, 2 days, 2 hours, 41 minutes ago

This is why most legal jobs in America will be outsourced within 10-15 years. Make your money fast people, the writing’s on the wall….
Posted by Molly Maguire - 1 year, 3 months, 1 week, 2 days, 2 hours, 41 minutes ago

Does that mean I can get bumped up from $35 an hour for doing doc review, or does it just mean the firm can bill the client $400 an hour instead of $250 for my incredible and well seasoned priv review skills.
Posted by Molly Maguire - 1 year, 3 months, 1 week, 2 days, 2 hours, 35 minutes ago

The industry needs to step up make sure our jobs can not go overseas to attorneys who are not admitted in our state. It’s time to protect our own lawyers because most of us don’t really make that much money already. It’s only those at the very top that make the big bucks. If the 70k a year without benefits or bonus goes away to India I will have to move there and Sallie Mae won’t ever see another dime from me.
Posted by Nicholas Parks - 1 year, 3 months, 1 week, 1 day, 20 hours, 24 minutes ago

It’s all relative. I went to GWU and worked at law firms in DC before moving to enter the business world. I knew legal secretaries making $75K+ - what a some lawyers in small towns consider themselves lucky to make. In fact, the labor market is sophisticated enough such that it is difficult to recruit a decent one for less. For lawyers, it all depends on your skill set. Lawyers just out of school have no skill set so to speak, yet still earn $160k plus and lawyers with finely honed skills and years of experience in a niche area of corporate law will earn $2m+/year - that’s $1k/hour assuming 40 hour weeks.
Posted by Molly Maguire - 1 year, 3 months, 1 week, 1 day, 19 hours, 11 minutes ago

Nicholas,
Your living in the past. Here in NYC most law graduates are making 75k or well below. Most students from lower ranked schools start at jobs for less than 32k per year, and it really does not go up that much at all. I personally work with legal secretaries at one of the largest firms in the world and they can only hit 75k after 30 years of service. When did you work as a lawyer? During the boom in the early 90’s? It’s over buddy, we are a dime a dozen now.
Posted by Alvin D. Chipmunkski - 1 year, 3 months, 1 week, 1 day, 2 hours, 47 minutes ago

Yes, its a lot on a per hour basis, but as others have said, there are plenty of others who can earn more without the skill and education. Also, look at the investment bankers, who get 5x as much for doing precious little other than peddle the offering to investors. I think you do the best you can with what you have, and not be overly concerned with an hourly rate. As one of the earlier posts noted, some of the work is outsourced to blubber-lipped lawyers overseas.
Posted by Rusty LaRue - 1 year, 3 months, 1 week, 1 day, 1 hour, 33 minutes ago

Mols,

You’re right..Law is not where it’s at.. Too much work for too little money.. Own your own business, invest, or go into banking - the real money out there is not in law.. We’re a dime a dozen..
Posted by Gris Frayre - 1 year, 3 months, 1 week, 21 hours, 15 minutes ago

a “seasoned” Lawyer is worth 1,000 per hour in my opinion. just like every athlete does not reach the major leagues, NFL or NBA not all Lawyers will reach this figure. in addition, unlike aprofessional athlete who reaches a large sum of money early in their career, an attorney must wait until later in their career.
Posted by Joe Reisinger - 1 year, 3 months, 1 week, 3 hours, 12 minutes ago

It’s about time! Most clients (insurance companies in particular) are so unsophisticated they can’t recognize value, even when they reap the benefit of it. Sounds like folks in the business community are getting smarter!
Posted by Owl - 1 year, 3 months, 6 days, 9 hours, 40 minutes ago

4100 or $ 1000/hr. The hourly rate make us all look like plumbers and our “plumber’s crack” is showing.
Posted by Phillip E. Seltzer - 1 year, 3 months, 4 days, 1 minute ago

Just see the famous Becky Klemt letter of August 1988—the letter that skewed the $1,000 hour fee lawyer in California. Google her name - read - then laugh outloud.
Posted by Bianca - 1 year, 3 months, 2 days, 23 hours, 46 minutes ago

Time to start using my legal insurance…
Posted by Larry - 1 year, 3 months, 2 days, 11 hours, 21 minutes ago

This is akin to legalized rape! No wonder attorneys have such a bad reputation these days. Just because the market will bear it doesn’t make it the right thing to do. I hope some Disciplinary Boards look to prosecute for violating the rules regarding excessive fees.

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