Casey Flaherty: In a previous exchange, I complained about the lack of Big Data, number-crunching wizardry being applied to law firm bills. Well, there’s an app for that. I’m quite excited to be preparing for a pilot with Sky Analytics. I’ll definitely write more when the time is ripe.
But, right now, I want to get your thoughts on a related product I’ve just deployed on a subset of matters. Viewabill is an ingenious piece of software that integrates with a law firm’s billing system (via API or a transmitter to push data from behind the firewall) and lets me watch my bills amass in real time. That is, I’ve got instant access to my accruing bills in my browser or through Viewabill’s iPhone app. I can see how much time has been entered by whom on every active matter. Indeed, if the law firm enables the feature (they’re in control, not me), I can even review all the attendant written entries.
The benign explanation for Viewabill is that tracking matters in real time avoids sticker shock. Counsel and I can discuss cost overruns while the project is ongoing. This is a far better option than a six-figure surprise several months after events have passed. There is genuine appeal to real-time transparency and coordination.
But I’m not so polite. Let’s name the thing that is. It is not just that I want to see when outside counsel record their time, I also want to know when they don’t. More pointedly, I am now able to tell when entries are made days or weeks after the work itself. Back in my law firm days, the office got real quiet on the day time needed to be closed. Lawyers were working feverishly to allocate their hours among their days, matters, and clients. You’ll therefore be hard pressed to convince me that there isn’t a large amount of unrighteous billing that results from a combination of (i) disorganization (what did I do last week?), (ii) memory bias (people fail to accurately recall how long a particular task took), and (iii) self-serving bias (a billable hour quota is a strong, subconscious motivator). Blue-chip bilking is real and, though most are honest, lawyers are not the one group of humans to avoid egotistical inference.
I’m not after outright graft – padding, churning, fabricating. I don’t deny these exist. But gratuitous .1’s and .2’s are hard to spot, even in real time. I am more concerned with the haze present on the 31st of July when some associate reconstructs their time from July 16 onward. The attorney is generally cognizant of having worked early mornings, late nights, and long weekends. With email and some notes, maybe, they have an idea of which projects consumed which days. But the notion that they are going to recall that they spent precisely 5.6 hours, not 6.3, on my motion on July 19 is a little ridiculous. Likewise, the assumption that their imperfect memory will not be subconsciously filtered through their need to reach 167 billable hours is naïve.
Or so I am inclined to believe. But not all the data supports me. And my opinion is at odds with the impressions of the timekeepers themselves. Do you think poor billing practices are actually saving me and other clients money? Is my focus on eliminating waste causing me to trust my outside counsel too little? I really don’t think so. Yet, as my wife reminds me daily, I am not always right. I’m genuinely excited about Viewabill. It is one more vital implement in my toolbox before the alternative-fee rapture takes all the pain away. Your insights would be appreciated.
Adam Losey: My first outside-counsel thought is that a lawyer should accommodate a client’s billing preferences. Clients run the gamut in what they prefer. Some have no specific requirements, and others have very specific billing preferences that involve granular detail and all sorts of real-time tracking and daily or weekly close-out requirements.
Where I work, we have offered real time tracking to our clients for free for several years now through what we moniker the Budget Management Tool. The customer is always right on what level of granularity is right for a bill, and real-time communication and transparency benefits everyone.
The software you mention is definitely a good thing to have out there. Real-time coordination requires some kind of automated technological solution to be truly efficient. It could be time consuming (and logistically difficult) to have staff manually compile and send daily bills, and it might be clunky for you to review and track with a manual-only system.
I think the answer to your question as to whether poor billing practices could save you money would vary lawyer-by-lawyer, firm-by-firm, and that there is no universally true answer to whether a lawyer will generally underbill or overbill. I make no claim to lawyer billing omniscience. My opinions are a product of my individual experience and career path.
However there is a universally true answer to what a lawyer must do if in genuine doubt as to a time entry – underbill – and I have certainly seen lawyers underbill clients when they were in doubt as to how much time they spent on a matter.
In my experience, a law firm will drill this concept into you from day one. But this concept is taught in tandem with the importance of prompt timekeeping- making sure to accurately record the billable time you spend on a matter. Clients should expect accurate bills, and it is certainly fair (and important for a law firm to function) to bill a client for time spent working on a matter.
The timekeeping program I use has small click-on and click-off stopwatches for multiple matters so I can keep track of time throughout the day fairly easily and have an accurate record. This works best if I am on a computer all day long. For days or weeks when I am in a deposition or trial, while I might not have the stopwatches, it is easy to record at least the amount of time I spent at the end of the day to plug in when I get back to the office.
Daily timekeeping is not rocket science. While it can be a bit of a chore, it is getting easier as more and more timekeeping technological solutions enter the marketplace. Perhaps when we all wear Google glass and run a timekeeping application that figures out what we are working on and bills accordingly second-by-second (with you having real-time access of course) this will not even be an issue. But when we hit that level, we may all be replaced by robot lawyers anyways.
On your approach, there is nothing wrong with a trust-but-verify approach. The idea of real-time access to what is going on in a case is not necessarily even a matter of trust, but rather a matter of improved communication. No law firm wants a client to be surprised with what is happening in a matter or with the bill- and everyone wins with better and more efficient communication.
In this installment, Adam Losey of Foley & Lardner talks with D. Casey Flaherty, corporate counsel at Kia Motors America.