DOCSLIB.ORG

Litigating on a Contingency: a Monopoly of Champions Or a Market for Champerty

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Litigating on a Contingency: a Monopoly of Champions Or a Market for Champerty Chicago-Kent Law Review Volume 71 Issue 2 Symposium on Fee Shifting Article 10 December 1995 Litigating on a Contingency: A Monopoly of Champions or a Market for Champerty Richard W. Painter Follow this and additional works at: https://scholarship.kentlaw.iit.edu/cklawreview Part of the Law Commons Recommended Citation Richard W. Painter, Litigating on a Contingency: A Monopoly of Champions or a Market for Champerty, 71 Chi.-Kent L. Rev. 625 (1995). Available at: https://scholarship.kentlaw.iit.edu/cklawreview/vol71/iss2/10 This Article is brought to you for free and open access by Scholarly Commons @ IIT Chicago-Kent College of Law. It has been accepted for inclusion in Chicago-Kent Law Review by an authorized editor of Scholarly Commons @ IIT Chicago-Kent College of Law. For more information, please contact [email protected], [email protected]. LITIGATING ON A CONTINGENCY: A MONOPOLY OF CHAMPIONS OR A MARKET FOR CHAMPERTY? RICHARD W. PAINTER* Two of the most divisive issues in current debate over civil litiga- tion are whether there should be limitations on lawyers' contingent fees and whether losing parties should be required to pay winners' legal expenses. Proponents of litigation reform urge both measures,1 but opponents argue that some "reforms" would be unfair to plaintiffs and would make litigation unaffordable for most people. 2 However, both debates hinge on a broader issue: how and when lawyers should share the risks of litigation. This Article examines the economic and ethical implications of such risk sharing by lawyers and their clients. In particular, this Article discusses whether the market for risk sharing * Assistant Professor of Law, University of Oregon School of Law. B.A., Harvard Uni- versity, 1984; J.D., Yale University, 1987. I would like to thank Lester Brickman, Chuck O'Kelley, Harold Krent, and Jennifer Duggan for helpful comments on prior drafts of this Article. 1. See Private Securities Litigation Reform Act, 15 U.S.C.A. § 77z-1(c) (West Supp. 1996) (requiring mandatory review by the court for attorney compliance with Rule 11(b) of the Fed- eral Rules of Civil Procedure, mandatory sanctions for violation of Rule 11(b), and a presump- tion in favor of attorneys' fees and costs as the sanction for failure to comply with Rule 11(b)) [hereinafter SLRA]. An earlier draft of the SLRA had gone even further in seeking to impose attorneys' fees as a sanction for unmeritorious suits. See H.R. 1058, 104th Cong., 1st Sess. § 20B(c) (1995) (stating that a court shall award attorneys' fees to the prevailing party if "(A) the position of the losing party was not substantially justified, (B) imposing fees and expenses on the losing party or the losing party's attorney would be just, and (C) the cost of such fees and expenses to the prevailing party is substantially burdensome or unjust"). The SLRA requires that attorneys' fees be a "reasonable percentage of the amount of any damages and prejudgment interest actually paid to the class," 15 U.S.C.A. § 77z-1(a)(6) (West Supp. 1996), and that any proposed settlement agreement disseminated to a class of shareholders shall state the attorneys' fees applied for, including calculation of those fees on a per share basis and a brief explanation of the basis for the application. Id. § 77z-l(a)(7). Similar provisions were included in a bill in the House of Representatives, covering diversity suits and suits over products liability. See H.R. 10, 104th Cong., 1st Sess. § 101 (1995). A proposal to require losing plaintiffs to pay defendants' legal expenses in securities lawsuits was defeated in the California March 26, 1996, primary elec- tion. See B. Drummond Ayres, Jr., Cougars and Lawyers Come out Ahead in Propositionson California Ballot, N.Y. TIMES, Mar. 28, 1996, at All. For discussion of proposals to limit law- yers' contingent fees, see infra text accompanying notes 17-20. 2. Injustice for Consumers, N.Y. TIMES, Mar. 8, 1995, at A20 (editorial). "The so-called British rule of 'loser pays' is alien to the American system of accessible justice. House Republi- cans seek nothing less than a crippling of the system of contingent fee arrangements that allow plaintiffs without great riches to retain good lawyers, who charge nothing if they lose and a share of the winnings if they win." Id. "The lesson is clear: A plaintiff of modest income would face far worse odds against a rich defendant under the British rule." Anthony Lewis & Charles Pe- ters, Tort and Retort: Should We Make Litigants Pay for the Cost of the Court Cases They Lose?, WASH. MONTHLY, May 1993, at 9. CHICAGO-KENT LAW REVIEW [Vol. 71:625 by lawyers is competitive and whether there are feasible alternatives to that market, such as insuring litigation costs with third parties. Charging on a contingency is most prevalent in the personal in- jury arena,3 but has spread to antitrust litigation, 4 shareholder deriva- tive suits,5 patent litigation, 6 mergtrs and acquisitions, 7 securities litigation,8 and even lobbying.9 This practice remains unique to the 3. Ninety-five percent of personal injury cases are taken on a contingency. Note, Settling for Less: Applying Law and Economics to Poor People, 107 HARV. L. REV. 442, 448 n.23 (1993) (citing JAMES S. KAKALIK & NICHOLAS M. PACE, COSTS AND COMPENSATION PAID IN TORT LITIGATION 37 (1986)). Although contingent fees traditionally are charged by plaintiffs' lawyers, defense lawyers occasionally charge "reverse contingent fees," which are an agreed upon per- centage of the amount the client saves. See Carrie Menkel-Meadow, Culture Clash in the Quality of Life in the Law: Changes in the Economics, Diversificationand Organizationof Lawyering, 44 CASE W. RES. L. REV. 621, 655 n.163 (1994) (discussing Aetna Insurance Company's policy of requesting "blended" value-billing from its lawyers, including a contingent fee with "reverse bonus for low settlement rates in defense work"). The ABA Standing Committee on Ethics and Professional Responsibility has concluded that in civil cases as long as the fee arrangement real- istically estimates the risk involved in a case, the fee is consistent with the Model Rules. See ABA Comm. on Ethics and Professional Responsibility, Formal Op. 373 (1993). 4. See Milton Handler, The Shift from Substantive to ProceduralInnovations in Antitrust Suits-The Twenty-Third Annual Antitrust Review, 71 COLUM. L. REV. 1, 9-10 (1971). 5. In derivative suits, as in securities class actions, attorneys' fees are actually paid under the "common fund" doctrine that allows a named plaintiff who creates a fund for the benefit of other injured investors to recover attorneys' fees from the fund. See George D. Hornstein, The Counsel Fee in Stockholder's Derivative Suits, 39 COLUM. L. REV. 784, 786 (1939). Judge Ralph K. Winter observes that "[t]he real incentive to bring derivative actions is usually not the hope of return to the corporation but the hope of handsome fees to be recovered by plaintiffs' counsel." Joy v. North, 692 F.2d 880, 887 (2d Cir. 1982), cert. denied, 460 U.S. 1051 (1983). 6. See Andrea Gerlin, Patent Lawyers Forgo Sure Fees on a Bet, WALL ST. J., June 24, 1994, at BI. Patent lawyer Gerald Hosier of Aspen, Colorado, used contingent-fee agreements and then settled many claims "by striking licensing deals valued at about $450 million with al- leged infringers. [His] contingency-fee agreement ... entitled him to a portion of the proceeds. In 1992, he earned an estimated $150 million." Id. 7. Daniel Hertzberg & James B. Stewart, Contingency Legal Fee for Merger Breaks Ground, Stirs Controversy, WALL ST. J., Oct. 24, 1986, at 31 (discussing "performance fee" charged by Wachtell Lipton and Skadden Arps). However, the vast majority of corporate work is billed at an hourly rate, a practice that gives rise to its own ethical issues. See William G. Ross, The Ethics of Hourly Billing by Attorneys, 44 RUTGERS L. REV. 1 (1991); George D. Hornstein, Legal Therapeutics: The "Salvage" Factor in Counsel Fee Awards, 69 HARV. L. REV. 658 (1956). 8. Contingent fees are commonplace in class action securities cases under § 11 of the 1933 Securities Act, 15 U.S.C. § 77k (1994), and § 10 of the 1934 Securities Exchange Act, 15 U.S.C. § 78j (1994), although some courts require lawyers to bid against each other for the work. See In re Oracle Sec. Litig., 131 F.R.D. 688, 697 (N.D. Cal.), 132 F.R.D. 538, 539, 542 (N.D. Cal. 1990), 136 F.R.D. 639, 641 (N.D. Cal. 1991) (outlining Judge Walker's imposition of bidding procedures on lawyers' seeking to become lead counsel in action brought against accountants). But see In re Activision Sec. Litig., 723 F. Supp. 1373, 1378-79 (N.D. Cal. 1989) (making judge-devised, bench- mark percentage-fee suggestions); Paul, Johnson, Alston & Hunt v. Graulty, 886 F.2d 268, 272 (9th Cir. 1989) (same). An intriguing fee arrangement was proposed when investors in Madison Plaza Associates, a limited partnership, made claims on a $330 million compensation fund set up by Prudential Securities to settle federal regulators' fraud allegations in connection with sale of the limited partnership interests. Baker & McKenzie, which also represented the general part- ner of Madison, agreed to represent the investors making claims against the Prudential fund for a contingent fee, but also insisted that part of any recovery be reinvested in Madison and "at least ten percent... be turned over to Madison's... general partner." Kurt Eichenwald, Baker Firm Withdraws Counsel Plan, N.Y. TIMES, Aug. 30, 1994, at D3 [hereinafter Baker Firm]; Kurt 1995] LITIGATING ON A CONTINGENCY United States; most other jurisdictions, including England and Scot- land, prohibit contingent fees in many circumstances.
Load more

Recommended publications
  • LARC @ Cardozo Law 1998-1999
    Yeshiva University, Cardozo School of Law LARC @ Cardozo Law Student Handbooks Life @ Cardozo 1998 1998-1999 Benjamin N. Cardozo School of Law Follow this and additional works at: https://larc.cardozo.yu.edu/student-handbooks Part of the Law Commons CARDOZO BENJAMIN N . CARDOZO SCHOOL OF LAW• YESHIVA UNIVERSITY Student Handbook 1998-99 This Handbook, effective September I, 1998, supersedes all previously published rules and regulations, announcements, statements, and publications with which it is inconsistent. The rules and regulations set forth in this Handbook are binding upon all students who are presently matriculated at Benjamin N. Cardozo School of Law (CSL), who are on leave of absence from CSL, or who are CSL students visiting at other law schools. Students are deemed to have read and understood both this Handbook and the CSL Bulletin (catalogue). Any questions concerning the contents of the Student Handbook or the CSL Bulletin should be addressed to the Office of the Dean. CSL reserves the right to change its rules and regulations, admissions and graduation requirements, course offerings, tuition, fees, and any other material set forth in its Bulletin or this Handbook at any time without prior notice. Changes become effective when posted on the official bulletin boards located on the second floor. Students should consult the designated bulletin boards at CSL for changes. TABLE OF CONTENTS I. INTRODUCTION . 1 II. CALENDARS .......................................... 2 A: 1998-99 ACADEMIC CALENDAR . 2 B. COURSE SCHEDULE ................................ 6 C. CALENDAR OF EVENTS .............................. 6 III. FACILITIES ........................................... 7 A. Brookdale Center -- 55 Fifth Avenue . .. 7 B. Residence Hall . 7 C. Yeshiva University .
    [Show full text]
  • View Full Article
    ARTICLE THE GLOBALIZATION OF ENTREPRENEURIAL LITIGATION: LAW, CULTURE, AND INCENTIVES JOHN C. COFFEE, JR.† INTRODUCTION ............................................................................ 1896 I. THE EUROPEAN FRONT: BARRIERS OUTFLANKED .................. 1900 A. The Fortis Litigation .................................................................. 1902 B. The Volkswagen Litigation .......................................................... 1908 II. ASIA: A SHIFT TOWARDS ENTREPRENEURIAL LITIGATION ...... 1911 A. Japan ....................................................................................... 1912 B. South Korea .............................................................................. 1914 C. China ...................................................................................... 1916 III. IMPLICATIONS AND ANALYSIS .................................................. 1917 A. How Should We Understand This New Phenomenon? ..................... 1917 B. New Patterns and New Issues ..................................................... 1919 1. New Players ...................................................................... 1919 2. The Third Party Funder: Superior or Inferior? .................. 1920 3. Reverse Auctions .............................................................. 1920 4. Unequal Distribution? ....................................................... 1921 5. Will the American Entrepreneurs Fade Away? ................... 1922 6. Counter-Reaction? ...........................................................
    [Show full text]
  • Cumulative Faculty Bibliography Through 2009 Fordham Law School Library
    Fordham Law School FLASH: The Fordham Law Archive of Scholarship and History Faculty Bibliography Law Library September 2018 Cumulative Faculty Bibliography Through 2009 Fordham Law School Library Follow this and additional works at: https://ir.lawnet.fordham.edu/fac_bib Part of the Law Commons Recommended Citation Fordham Law School Library, "Cumulative Faculty Bibliography Through 2009" (2018). Faculty Bibliography. 13. https://ir.lawnet.fordham.edu/fac_bib/13 This Book is brought to you for free and open access by the Law Library at FLASH: The orF dham Law Archive of Scholarship and History. It has been accepted for inclusion in Faculty Bibliography by an authorized administrator of FLASH: The orF dham Law Archive of Scholarship and History. For more information, please contact [email protected]. Fordham Law School Cumulative Faculty Bibliography Through 2009 ABRAHAM ABRAMOVSKY Books (Editor) Criminal Law and the Corporate Counsel. New York: Harcourt Brace Jovanovich, 1981. Journal Articles “Prosecuting Judges for Ethical Violations: Are Criminal Sanctions Constitutional and Prudent, or Do They Constitute a Threat to Judicial Independence?” 33 Fordham Urban Law Journal 727-773 (2006) [with Jonathan I. Edelstein] “Criminal Law Current Comment: People V. Suarez and Depraved Indifference Murder: The Court of Appeals' Incomplete Revolution.” 56 Syracuse Law Review 707-734 (2006) [with Jonathan I. Edelstein] ADepraved Indifference Murder Prosecutions in New York: Time for Substantive and Procedural Clarification.@ 55 Syracuse Law Review 455-494 (2005) (with Jonathan I. Edelstein). "The Drug War and the American Jewish Community: 1880 to 2002 and Beyond." 6 The Journal of Gender, Race & Justice 1-38 (2002 ) (with Jonathan I.
    [Show full text]
  • PRESENT: All the Justices THOMAS HUNT ROBERTS OPINION by V
    PRESENT: All the Justices THOMAS HUNT ROBERTS OPINION BY v. Record No. 180122 JUSTICE D. ARTHUR KELSEY SEPTEMBER 6, 2018 VIRGINIA STATE BAR FROM THE VIRGINIA STATE BAR DISCIPLINARY BOARD Thomas Hunt Roberts appeals a decision of the Virginia State Bar Disciplinary Board (the “Disciplinary Board” or the “Board”) sanctioning him with a public reprimand with terms after finding that he violated Rules 1.15(a)(3)(ii) and 1.15(b)(5) of the Virginia Rules of Professional Conduct (“Disciplinary Rules”). Finding no error in the Board’s decision, we affirm. I. On appeal, “we view the evidence and all reasonable inferences that may be drawn therefrom in the light most favorable to the Bar, the prevailing party below.” Green v. Virginia State Bar, ex rel. Seventh Dist. Comm., 274 Va. 775, 783 (2007). A. THE REPRESENTATION AGREEMENT In December 2014, Lauren Hayes engaged Thomas H. Roberts & Associates, P.C., to represent her regarding a personal injury claim arising out of a vehicle collision. On behalf of the firm, Roberts entered into a Representation Agreement, see 2 J.A. at 332-37, which, among other things, provided that the firm would receive a contingency fee of “33 1/3 percent of the gross . of any and all judgment and/or recovery, computed before any deductions, including but not limited to expenses or costs,” id. at 332. The agreement stated that the contingency fee would increase to 40% “[i]f the recovery is within 45 days of the first trial date or thereafter.” Id. It also provided that “any settlement or award” that included attorney fees “shall be paid to the law firm in addition to the contingency fees provided for above.” Id.
    [Show full text]
  • Cost and Fee Allocation in Civil Procedure
    International Academy of Comparative Law 18th World Congress Washington D.C. July 21-31, 2010 Topic II.C.1 COST AND FEE ALLOCATION IN CIVIL PROCEDURE General Reporter: Mathias Reimann University of Michigan Introduction The following questionnaire is intended to cover civil procedure only, i.e., cases brought under private and commercial law. It does not intend to address criminal, constitutional, administrative proceedings, and arbitration. It consists of 25 questions organized under seven main headings. In answering them, please distinguish, as far as appropriate, what is usual, what is unusual but permitted, and what it prohibited. If there are readily available statistics, please provide them (in an appendix or otherwise). Please strive to be clear and concise and stay as close to the substance and sequence of the questions as possible so as to ensure the comparability of answers across a large number of countries. If a question does not make sense in the context of your legal system, briefly say so; if other issues are pertinent, please mention them. Questionnaire I. The Basic Rules: Who Pays? 1. What is the basic rule of cost and fee allocation - that each party bears its own or that the loser pays all? Are attorneys' fees and court costs treated differently? What is the principal justification for this rule? The cost of litigation consists of court fee (saiban hiyo)and party fee(tojisya hiyo). The court fee consists of payment to the court for sue and the cost of taking of the evidence. The party fee consists of traveling and necessary cost of party and representative.
    [Show full text]
  • (Rev. August 2005) Working Paper in Regulatory Studies
    LOGOS Defining What to Regulate: Silica & the Problem of Regulatory Categorization Andrew P. Morriss & Susan E. Dudley CASE WESTERN RESERVE UNIVERSITY SCHOOL OF LAW Case Research Paper Series, No. __ (Rev. August 2005) MERCATUS CENTER AT GEORGE MASON UNIVERSITY Working Paper in Regulatory Studies ABSTRACT This article examines the history of human exposure to silica, the second most common element on earth, to explore the problem of categorizing substances for regulatory purposes and the role interest groups play in developing policy. The regulatory history of silica teaches three important lessons: First, the most compelling account of the cycle of action and inaction on the part of regulators is the one based on interest groups. Second, knowledge about hazards is endogenous – it arises in response to outside events, to regulations, and to interest groups. Accepting particular states of knowledge as definitive is thus a mistake, as is failing to consider the incentives for knowledge production created by regulatory measures. Third, the rise of the trial bar as an interest group means that the problems of silica exposure and similar occupational hazards cannot simply be left to the legal system to resolve through individual tort actions. We suggest that by understanding market forces, regulators can harness the energy of interest groups to create better solutions to addressing the problems of silica exposure, as well as other workplace health and safety issues. Defining What to Regulate: Silica & the Problem of Regulatory Categorization Andrew P. Morriss* & Susan E. Dudley** I. The Problem of Categorization................................................................................... 3 A. Characterization ...................................................................................................... 5 B. Silica Categorization and Health Effects ...............................................................
    [Show full text]
  • Cost and Fee Allocation in Civil Procedure James Maxeiner University of Baltimore School of Law, [email protected]
    University of Baltimore Law ScholarWorks@University of Baltimore School of Law All Faculty Scholarship Faculty Scholarship 2010 Cost and Fee Allocation in Civil Procedure James Maxeiner University of Baltimore School of Law, [email protected] Follow this and additional works at: http://scholarworks.law.ubalt.edu/all_fac Part of the Courts Commons, and the Legal Profession Commons Recommended Citation Cost and Fee Allocation in Civil Procedure, 58 Am. J. Comp. L. 195 (2010) This Article is brought to you for free and open access by the Faculty Scholarship at ScholarWorks@University of Baltimore School of Law. It has been accepted for inclusion in All Faculty Scholarship by an authorized administrator of ScholarWorks@University of Baltimore School of Law. For more information, please contact [email protected]. JAMES R. MAXEINER* Cost and Fee Allocation in Civil Proceduret Court costs in American civil procedure are allocated to the loser ("loser pays") as elsewhere in the civilized world. As Theodor Sedgwick, America's first expert on damages opined, it is matter of inherent justice that the party found in the wrong should indemnify the party in the right for the expenses of litigation. Yet attorneys' fees are not allocated this way in the United States: they are allowed to fall on the party that incurs them (the ''American rule," better, the Ameri­ can practice). According to Albert Ehrenzweig, Austrian judge, emigre and then prominent American law professor, the American practice is "a festering cancer in the body of our law." This Article surveys Ameri­ can cost and fee allocation practices. The author hopes that the Article will serve as a prolegomenon from an American perspective for more­ encompassing comparative studies, including eventually of empirical studies.
    [Show full text]
  • A Rejoinder to Lester Brickman: on the Theory Class's Theories of Asbestos Litigation
    Pepperdine Law Review Volume 32 Issue 4 Article 1 5-15-2005 A Rejoinder to Lester Brickman: On the Theory Class's Theories of Asbestos Litigation Charles Silver Follow this and additional works at: https://digitalcommons.pepperdine.edu/plr Part of the Legal History Commons, and the Torts Commons Recommended Citation Charles Silver A Rejoinder to Lester Brickman: On the Theory Class's Theories of Asbestos Litigation, 32 Pepp. L. Rev. Iss. 4 (2005) Available at: https://digitalcommons.pepperdine.edu/plr/vol32/iss4/1 This Response is brought to you for free and open access by the Caruso School of Law at Pepperdine Digital Commons. It has been accepted for inclusion in Pepperdine Law Review by an authorized editor of Pepperdine Digital Commons. For more information, please contact [email protected], [email protected], [email protected]. A Rejoinder to Lester Brickman: On the Theory Class's Theories of Asbestos Litigation Charles Silver* INTRODUCTION In 2003, the Pepperdine Law Review hosted a conference on mass tort litigation and later published a symposium issue containing the articles pre- sented there. Professor Lester Brickman and I participated in a panel de- voted to legal ethics. I listened to Professor Brickman's spoken remarks, and I am certain he said nothing about me personally. I was therefore sur- prised to discover that an entire section of Professor Brickman's published article contained a personal attack on me. I was also dismayed to read a host of misstatements and misleading statements, none of which Professor Brickman attempted to verify by checking with me.
    [Show full text]
  • Retaliatory RICO and the Puzzle of Fraudulent Claiming
    Michigan Law Review Volume 115 Issue 5 2017 Retaliatory RICO and the Puzzle of Fraudulent Claiming Nora Freeman Engstrom Stanford Law School Follow this and additional works at: https://repository.law.umich.edu/mlr Part of the Litigation Commons, and the Torts Commons Recommended Citation Nora Freeman Engstrom, Retaliatory RICO and the Puzzle of Fraudulent Claiming, 115 MICH. L. REV. 639 (2017). Available at: https://repository.law.umich.edu/mlr/vol115/iss5/2 This Article is brought to you for free and open access by the Michigan Law Review at University of Michigan Law School Scholarship Repository. It has been accepted for inclusion in Michigan Law Review by an authorized editor of University of Michigan Law School Scholarship Repository. For more information, please contact [email protected]. RETALIATORY RICO AND THE PUZZLE OF FRAUDULENT CLAIMING Nora Freeman Engstrom* Over the past century, the allegation that the tort liability system incentivizes legal extortion and is chock-full of fraudulent claims has dominated public discussion and prompted lawmakers to ever-more-creatively curtail individu- als’ incentives and opportunities to seek redress. Unsatisfied with these con- ventional efforts, in recent years, at least a dozen corporate defendants have “discovered” a new fraud-fighting tool. They’ve started filing retaliatory RICO suits against plaintiffs and their lawyers and experts, alleging that the initia- tion of certain nonmeritorious litigation constitutes racketeering activity— while tort reform advocates have applauded these efforts and exhorted more “courageous” companies to follow suit. Curiously, though, all of this has taken place against a virtual empirical void. Is the tort liability system actually brimming with fraudulent claims? No one knows.
    [Show full text]
  • Nonrefundable Retainers: Impermissible Under Fiduciary, Statutory and Contract Law
    Fordham Law Review Volume 57 Issue 2 Article 1 1988 Nonrefundable Retainers: Impermissible Under Fiduciary, Statutory and Contract Law Lester Brickman Lawrence A. Cunningham Follow this and additional works at: https://ir.lawnet.fordham.edu/flr Part of the Law Commons Recommended Citation Lester Brickman and Lawrence A. Cunningham, Nonrefundable Retainers: Impermissible Under Fiduciary, Statutory and Contract Law, 57 Fordham L. Rev. 149 (1988). Available at: https://ir.lawnet.fordham.edu/flr/vol57/iss2/1 This Article is brought to you for free and open access by FLASH: The Fordham Law Archive of Scholarship and History. It has been accepted for inclusion in Fordham Law Review by an authorized editor of FLASH: The Fordham Law Archive of Scholarship and History. For more information, please contact [email protected]. Nonrefundable Retainers: Impermissible Under Fiduciary, Statutory and Contract Law Cover Page Footnote Professor of Law, Benjamin N. Cardozo School of Law. B.S. 1961, Carnegie-Mellon University; J.D. 1964, University of Florida; LL.M. 1965, Yale University. Associate, Cravath, Swaine & Moore, New York, New York. B.A. 1985, University of Delaware; J.D. magna cum laude 1988, Benjamin N. Cardozo School of Law. This article is available in Fordham Law Review: https://ir.lawnet.fordham.edu/flr/vol57/iss2/1 NONREFUNDABLE RETAINERS: IMPERMISSIBLE UNDER FIDUCIARY, STATUTORY AND CONTRACT LAW LESTER BRICKMAN* LAWRENCE A. CUNNINGHAM** TABLE OF CONTENTS Introduction .............................................. 150 I. The Lawyer as Fiduciary .................................. 153 A. Client's Right to Discharge............................ 155 B. Codification of Trust ................................... 156 C. Exceptions to the Discharge Right ..................... 157 D. Historic Development ................................. 160 1. Up to Martin v.
    [Show full text]
  • Lester Brickman July 9, 2008
    Transcription of Oral History Interview with Lester Brickman July 9, 2008 (0:00) YAROSHEFSKY: …you’re currently at Cardozo Law School? BRICKMAN: Yes. YAROSHEFSKY: And in 1968 where were you teaching? BRICKMAN: 1968 well, I started teaching in 1966, which is umpteen years ago, I started teaching at the University of Toledo. I had gone to Law School at the University of Florida and then I was spirited away by the ‘L’ underground on the faculty at Florida and went to Yale for a year of finishing school. One of my professors at Florida, who had been among those that steered me into Yale and then into teaching, had left Florida to open the day law school at Toledo, so when I came on the market he was looking for professors and I was hired at the University of Toledo. I started teaching in 1966 and in 1968 I was still teaching at Toledo. I had gone through a divorce and like many in that circumstance I was looking for a (1:00) chance of circumstances, a change of scenery for a bit, and there’s a notice or something pops up about the Council on Legal Education for Professional Responsibility seeking a research professor or research fellow to spend a year in New York at this new foundation to work in the area of Clinical Legal Education. I had already started a program at Toledo, what I called the Law and Poverty Program, that I had gotten a small grant for that wasn’t really a clinical program it was more of an out-house program I had people intern in the housing agency and the various other entities, governmental entities, in downtown Toledo.
    [Show full text]
  • The Lawyer As a Portfolio Manager
    THE LAWYER AS A PORTF OLIO MANAGER : H OW DOES THE FEE SYST EM INFLUENCE ON THE LAWYER 'S DECISION OF HANDLI NG LEGAL CLAIM ? CHRISTIAN AT AND NATHALIE CHAPPE CRESE UNIVERSITY OF FRANCHE COMTE UFR S JEPG, A VENUE DE L'O BSERVATOIRE 25 030 B ESANCON FRANCE Abstr act: We use the portfolio theory to analyze the lawyer's decision regarding the type of case the lawyer will handle. We offer some insights into the widespread idea that contingency lawyers are providing a risk sharing service. We demonstrate that a contin gent fee lawyer diversifies his portfolio. We show that reputation induces more, but not fully, concentration, since a lawyer with greater reputation or expertise selects more risky cases. The size of the law firm has the same result. Keywords: Lawyer, leg al fee, portfolio analysis. We are especially grateful to Pr. Bert Kritzer for thoughtful comments. Usual disclaimers apply. THE LAWYER AS A PORTF OLIO MANAGER : H OW DOES THE FEE SYST EM INFLUENCE ON THE LAWYER 'S DECISION OF HANDLI NG LEGAL CLAIM? INTRODUCTION Lawyer fee arrangements are subject to a current debate. Contingent fees are widely used in the United States, but are banned or regulated in many other countries (Great Britain, France). In those countries, clients generally paid their lawyer at an hourly fee or a fixed fee. The standard description of the contingent fees is no win, no pay: the lawyer receives a fixed percentage of the amount recovered from the other side if the case is won; he receives nothing if the case is lost.
    [Show full text]