A competitive bid on rates that takes advantage of a firm’s lower cost structure

I have written about the arbitrage opportunities for multi-office law firms (See my post of June 15, 2006 on the use of associates from lower-cost cities.). In a proposal, rather than state discounts from rates, an aggressive and confident law firm might commit to billing rates by year out of law school that are five percent below the next highest bidder’s average billing rate for each class year.

This would be dramatic, clear and compelling for the law department. From its side, “This firm knows it’s lower cost and it’s willing to back up its claim on that point.”

Dream on, Rees. What law firm executive team would run what it perceives to be such a risky gauntlet?