In-house lawyers admit some resistance to alternative fee arrangements, but blast law firms, perhaps unfairly

A survey of corporate lawyers conducted by Serengetti asked them to scale their own resistance to alternative fee arrangements (AFA) and their perception of law firm resistance to AFAs. On the scale given, a 1 means “no resistance”; a 3 presumably means moderate resistance; and a 5 a “great deal of resistance.”

The corporate lawyers overall gave themselves a 1.7, indicating relatively little resistance. But they clobbered law firms: 3.2. As I might phrase it, “We are open to AFAs, you partners are Luddite refusniks!” This finding, embellished a tad by me, comes from the ACC Docket, April 2010 at 12, which offers no additional explanation.

It is unclear whether the question asked respondents to consider US law firms as a whole, or it might have limited the respondents to law firms they work with.

It could legitimately be that “resistance” as perceived by in-house lawyers is actually a considered reaction of partners to the complexity of working out the arrangement. Or it could be that the risks of a fixed fee to handle all work of a certain kind during a period of time, for example, are too high for a firm given the expected modest volume. You can blast that as “resistance” or commend it as business acumen.

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