House passes bill aimed at patent ‘trolls’ based in part on high litigation costs. Inside Counsel has more on the story.

From our “how much does it cost?” files: Apple’s external monitor bills at $1,100 per hour, and his BigLaw support at $1,025 per hour.

Also from our “how much does it cost?” files: Jury awards $27,280 in damages in gender discrimination case, and Ninth Circuit rejects challenge to the nearly $700,000 attorney fee award. (reg. req’d)

Should the “litigation settlement machine” be reformed so that clients get “someone to decide who’s right, and to resolve the dispute by deciding it, not by forcing a compromise”?

Will firms that downsize their real estate costs be rewarded with more work since the “traditional square footage is not necessary to do a great job serving clients and providing a great workspace.” Or do law department leaders count on access to conference rooms and other resources as part of their outside counsel’s package of services?

Is it fair to assume that “hot” practice areas will command premium rates, while “not hot” areas won’t?

U.K. panel review news: GC-less builder finalizes first law firm panel.

Patent lawsuit news: Google paid billions for a MAD (mutually assured destruction) strategy to prevent this kind of lawsuit, but it happened anyway. Patent litigators across the country hear “ka-ching!”

BigOil GC reduces outside counsel spending by 50%, and changes strategy for managing litigation by moving “control from external counsel by bringing litigation in-house in a big way.” And in the spirit of Right-Tasking: “The priority was to have a legal organisation that was the right size and focused on the right things to support the business…”

Also on the patent litigation front: Vermont’s AG and legislature join in, with the Bad Faith Assertions of Patent Infringement statute, “to protect legitimate patent holders while dealing with the types of suits that are brought by patent trolls. ”

Continuing the patent litigation theme: would a public registry of demand letters “help curb the unwarranted and costly attacks businesses and their customers face from the patent assertion entities (PAEs).” A crowdsourcing concept that makes good sense, it seems to me.

BigLaw helps ACLU pursue information on public sector legal fees, alleging that some law firms “may have engaged in ‘scorched earth’ litigation tactics and dragged out cases even when a settlement was in the best interest of the County or when a settlement was likely.” (sub. req’d)

More than discounts: clients also want introductions to other clients.

Was $1.40 or $92,000 the appropriate award for legal fees? The Fourth U.S. Circuit Court of Appeals explains why it went with the lower number. (sub. req’d)

From our “how much does it cost?” files: $2 million for voting rights case, including up to $920/hour for name partner.

In-house leaders who continue to grapple with the philosophy, standards and details for their billing guidelines for outside counsel would be well-served to review the “Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses” released this summer by the U.S. Department of Justice.

Acting Associate Attorney General Tony West described the thinking behind the new Guidelines as follows: “At a time when both the public and the most sophisticated participants in the bankruptcy process say bankruptcy attorneys’ costs are rising too rapidly, these guidelines are designed to ensure that statutory requirements limiting bankruptcy fees to market rates – not premium rates – are followed.” The updated guidelines apply to cases filed on or after Nov. 1, 2013.

Although the DOJ’s Guidelines are aimed at large bankruptcy cases with $50 million or more in assets and $50 million or more in liabilities, corporate consumers of sophisticated legal services face similar issues every time they retain outside counsel and review their bills. The Guidelines’ “Goals” are consistent with the objectives of in-house leaders, including ensuring that counsel “are subject to the same client-driven market forces, scrutiny, and accountability as professionals in non-bankruptcy engagements.”

Key features of the Guidelines include requirements for budgets and staffing plans “to bring discipline, predictability, and client involvement and accountability to the compensation process,” and billing records that are in an open and searchable electronic format “to decrease the administrative burden and increase the efficiency of review of fee applications.” The Guidelines also call for the use of independent fee committees and fee examiners “to ensure that professional fees and expenses paid by the estate are reasonable, actual, and necessary” and to “monitor, review, and where appropriate, object to interim and final applications for fees and expenses filed by professionals who seek compensation from the estate” – a practice that may be worthwhile for in-house counsel to consider adapting for extremely large projects if they lack the resources to conduct in-depth invoice reviews.

Following are a few highlights from the Guidelines for your consideration the next time you update your outside counsel billing guidelines:

- Regarding “Staffing inefficiencies,” “the United States Trustee encourages applicants to consider how to assign and staff more routine and “commoditized” work, such as avoidance actions and claims objections, and to consider whether lower cost co-counsel should be retained for discrete types of work, while being careful to avoid duplication, overlap, and inefficiencies.”
- Regarding “Transitory professionals,” the U.S. Trustee will consider “whether any of the applicant’s professionals billed only a few hours to the matter with insufficient evidence of benefit to the estate. The United States Trustee may object if the applicant fails to justify the necessity or benefit of these professionals’ services.”
- “Vague or repetitive entries” are also disfavored, as the Trustee can be expected to “object to vague or repetitive entries that are otherwise unjustified. Phrases like “attention to” or “review file,” without greater specificity or more detail, are generally insufficient.”
- Considerations for out of pocket expenses include prorating travel expenses that are applicable to more than one case, reasonableness (coach class not first), and excluding overhead (word processing, proofreading and secretarial support).
- The project categories for bankruptcy cases may also provide useful guidance when you request similar categorization on bills for major projects.
- The detailed requirements for invoice summaries are also worth adopting in whatever form best suits your situation.

Every company’s needs will differ, but the DOJ’s Guidelines may be a very useful point of reference when you embark on updating your outside counsel billing guidelines.