Bill reductions need to be legitimate for a general counsel to claim savings

From the 2008 ACC/Serengeti Managing Outside Counsel Survey, published in the ACC Docket, Vol. 27, May 2009 at 9, comes this finding: “[C]ounsel most frequently reduce bills for what they perceive as time not well spent for the following reasons (in decreasing order of priority): overstaffing at hearings/meetings, administrative work/filing/organization, time billed to the wrong matter, duplicate invoices and office conferences.”

Two observations occurred to me from that sentence. First, a law department does not save money if time billed to the wrong matter is corrected to the right matter, although of course if the time billed were to some other client’s matter the reduction would be legitimate. Nor is there a saving from rejecting duplicate invoices, unless the law department commonly paid the same bills twice.

The second observation is that none of these reasons explicitly depend on an assessment that the value obtained by the client for work done was less than the amount billed by the firm. Over-staffing perhaps implies that one or more people at a hearing or meeting were superfluous, but the basis for the reduction feels more mathematical than substantive. “Office conferences” is too vague. Genuine reductions of bills ought to pivot on marking down legal work done poorly, inefficiently, or inappropriately.

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