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In Germany, 20% discounts but a clawback bonus expected for successful projects

The chief corporate lawyer at Deutsche Lufthansa, Nicolai von Ruckteschell, went on record about law firms that serve his company and venture into alternative fees. According to him in the European Lawyer, Issue 91, Nov./Dec. 2009 at 35, “We have seen a bit of risk sharing, with a lot of firms giving a reduction of up to 20 per cent of the hourly rates, but then expecting a bonus at the end if the project is successful. That is what most firms are offering.”

For me, a discount that evaporates if the matter is successful is not a discount. It is deferred contingent billing. That doesn’t make it unattractive to legal departments but it also doesn’t make it a probable money-saver.