Attorney Fees

BigLaw firm billed for 'outlandish' Ritz-Carlton stays, first-class airfare, suit alleges

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Updated: A suit filed by a bankruptcy trustee alleges Williams & Connolly’s legal bills for an arbitration “exceeded the bounds of reasonableness” and the expenses it incurred were “outlandish.”

The suit (PDF), filed last Wednesday by a trustee for the corporate owner of several vocational training schools, also targets Duane Morris, the Am Law Daily (sub. req.) reports. Its legal bills were “duplicative and unreasonable, especially in light of the excessive work allegedly performed by W&C,” the complaint alleges.

The law firms represented ATI Enterprises in an arbitration of claims by former students. The suit claims Williams & Connolly’s hourly rates were unreasonable, and it overstaffed the case, billing more than $13 million in fees and expenses.

“On a regular basis, three or four partners, six to eight associates, seven or more special project attorneys, a few agency attorneys, a system consultant and five-plus paralegals logged substantial hours on the case,” the suit says. “The time keepers often billed more than 12 hours per day, without providing information indicating that the work conducted benefited anybody other than W&C.”

“W&C also incurred outlandish expenses, including billing for nearly $47,000 in first-class airfare, over $60,000 in hotel reimbursement for staying at the Ritz-Carlton and $31,000 in copying charges—in a single month,” the suit claims.

The suit also names as a defendant Carli Strength, who was the former CEO of ATI, according to this WFAA story on the school’s job claims. The suit says Strength “did nothing to monitor, review or question the outlandish fees and expenses charged by W&C, or to monitor the need for, and value of, services provided by Duane Morris.”

ATI was ordered to pay $1.7 million in the arbitration.

Williams & Connolly issued a statement to the Am Law Daily that said the lawsuit does not fairly characterize the size and intensity of the litigation, and it is confident its work met professional standards.

“There were more than 650 individual claimants,” the statement said. “The litigation lasted for more than two years, including more than 90 depositions. The trial of 12 bellwether claimants involved 50 live witnesses and 30 witnesses by deposition, and it consumed a month.”

The amount that ATI was ordered to pay amounted to “a tiny fraction” of the claimants’ demands, the statement said.

Duane Morris issued this statement to the ABA Journal: “Duane Morris played a very limited role in the litigation and firmly stands by our excellent work and reasonable billing.”

Story updated on Jan. 26 to add statement from Duane Morris.

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