Attorney Fees
Venture Capitalist Slams Lawyers in Blog Harangue
Posted Jun 4, 2008, 06:02 am CST
By Debra Cassens Weiss
A lawyer and venture capitalist rails against rising lawyer salaries and the big legal bills they produce in a 1,120-word blog harangue.
Jason Mendelson, a lawyer and venture capitalist with the Foundry Group and Mobius Venture Capital, compares his starting lawyer salary of $71,000 in 1998 with today’s paychecks and declares that salaries and bonuses have risen 132 percent in a decade, the Recorder reports.
"I've been working on a thesis for quite some time that the entire business model of law firms is going to have to change," he wrote, "or it's going to get uglier."
Mendelson says law firms are overlawyering simple venture capital deals and charging too much money for the work. In one case, his firm was billed $72,000 for legal work for a first round of financing. Financings are “largely cookie-cutter,” Mendelson writes, yet he found himself working to negotiate “stupid boilerplate language that no one really cares about. …. Why can’t lawyers know when to leave well enough alone and not feel like every piece of paper needs a markup?”
He later told the Recorder in an interview that he wrote the post because of his growing frustration. "There were a few things that happened in the last few months that were sort of the last straw," he said.
Updated at 12:59 p.m. to indicate that Mendelson earned $71,000 in 1998.
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Comments
Posted by law dude - 5 months, 4 weeks, 16 hours, 5 minutes ago
if you use the inflation calculator at westegg.com, his $72k in 1988 is $126k. Isn’t it funny how somethign is “routine” but the client still has to be protected?
Posted by associate - 5 months, 4 weeks, 15 hours, 9 minutes ago
I wonder if he would want to arge about the “boiler plate language that no one cares about” if a judge ruled against his firm based on that language.
Why do I think this guy would file suit for malpractice the same day in such a case?
Posted by associate - 5 months, 4 weeks, 15 hours, 7 minutes ago
Law dude,
Weren’t billable hours requirements also generally lower in 1988 by around 300 average? So is his starting salary more like 160k today, plus some family time (which is arguably more valuable than the money)?
Posted by msg - 5 months, 4 weeks, 10 hours, 36 minutes ago
I am glad a business person/attorney has finally spoken out against the unbelievably high attorney fees (and I am an attorney). I think it makes justice unavailable to the middle class. The rich can afford it, the poor get it free, and the middle class get screwed.