Legal Fee Audits

Legal fee audits are at the core of everything we do. Whether managing complex litigation, resolving a fee dispute or budgeting for future costs—it all begins with a careful audit of legal spend. As part of our industry-leading audit process, LFS will assess the reasonableness of legal fees and expenses, identify opportunities for recoupment of overspend and design strategies to control cost moving forward.

AUDIT PROCESS

  • Interview clients and review materials from all underlying legal matters to develop a factual context for the analysis of fee data. LFS crafts sophisticated confidentiality agreements to ameliorate attorney-client privilege concerns.
  • Reconcile all electronic and paper invoices to identify mathematical or accounting errors and to ensure that discounts are properly addressed.
  • Create profiles of each timekeeper to distinguish between core team members and providers of specialty services or administrative support.
  • Categorize billed efforts in our proprietary database according to a three-part coding system. A phase code identifies project stage (i.e. motions or discovery); a task code identifies work product (i.e. complaint or deposition); and an activity code identifies specific effort (i.e. write, review or discuss).
  • Map legal spend across all fee and expense categories, then evaluate spending in the context of reasonableness guidelines and market norms. Attorneys do not rely on computer-generated red flags; they manually assess waste, mismanagement and inefficiency.
  • Prepare a detailed and comprehensive report that identifies any legal expenses that appear unreasonable and provide practical strategies to recoup past overspend and limit future costs.

Experience

  • Evaluated over $300 million in attorneys’ fees and expenses incurred defending product liability claims brought against pharmaceutical manufacturer, to determine whether the costs were reasonable, related to the defense of covered claims, and otherwise recoverable under various insurance policies.
  • Evaluated approximately $32 million Fortune 500 company paid to outside counsel to determine whether the fees were reasonable and otherwise complied with company’s billing guidelines.
  • Evaluated approximately $8 million in costs pharmaceutical paid to outside counsel in connection with patent litigation, to determine whether costs were reimbursable pursuant to licensing agreement.
  • Evaluated approximately $2 million Fortune 500 company paid to outside counsel as part of alternative fee arrangement, to determine whether company received cost-effective legal representation under alternative fee arrangement, and whether alternative fee arrangement should be modified or extended.
  • Evaluated approximately $3 million insurer paid to insured-selected counsel over 5-year period to determine whether the fees were reasonable and otherwise complied with agreed-to billing guidelines.
  • Evaluated $700K in fees insurer paid to insured-selected counsel over 4-year period to determine whether the fees were reasonable and otherwise complied with agreed-to billing guidelines.
  • Evaluated approximately $2 million privately-held company paid to outside counsel prosecuting trade secret claims, to determine whether the fees were reasonable and were otherwise properly reimbursable.
  • Evaluated approximately $30 million in fees incurred by insured-selected counsel defending shareholder derivative litigation and an SEC investigation following a restatement of earnings, to determine whether the fees were reasonable and related to the defense of covered claims.
  • Evaluated approximately $6 million incurred by insured-selected counsel defending various legal malpractice claims, to determine whether the fees were reasonable and related to the defense of covered claims.

[844] 726-4204

LFS is a consulting firm and does not practice law.

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