The Benefits of Hiring a Small Law Firm for Business Litigation.
Business litigation occurs when two or more businesses dispute over certain issues. In court, many of the business litigation involves allegations of breach of contract and fraud. The common alleged causes of action are:
● Breach of contract
● Intentional misrepresentations
● Negligent misrepresentations
The parties involved will need to retain a business lawyer to prosecute or defend the business dispute claims. When the stakes exceed $250,000.00, it is critical to hire a business litigation lawyer who has trial experience.
Law firms with more than ten lawyers are often inefficient to serve businesses. The reason being the lawyer who brings in the business client doesn't do the work. The work is delegated to young lawyers who do most of the research and writings. Then, the supervising lawyer will have to approve the young lawyer's job. Finally, once the supervising attorney accepts the young lawyer's work product, the rainmaking lawyer - the client hired - has to approve review of the work by the two lower-tier lawyers. Ultimately, the law firm bills the business the clients for three lawyers' work.
In contrast, small law firms are much more efficient than large firms. Generally, small law firms delegate one lawyer to handle the entire litigation. If the case requires more than one lawyer, the small law firms will delegate a second lawyer on the matter. In the large law firms, the same work is repeated by each lawyer who is involved in the case. The small firm does the job once and done.
Business litigation may become very expensive. The average big law firms bill an average of $550 per hour. The smaller law firms charge an average of $450 per hour. The reason for the $100 difference in hourly billing is the large firms have higher overheads, which include support staff. Additionally, big law firms tend to impress their business clients with expensive office space in downtown. Generally, the average total bill from a major law firm for a typical business dispute is $450,000. In contrast, the smaller firms commonly bill $300,000 for the same litigation.
It is common in business disputes that there is a contract for an attorney's fee. The prevailing party will submit their attorney's cost to the court. The losing party will need to pay for the prevailing party's attorney's fee. The parties generally dispute the reasonableness of the attorney's fee.
In large firms, the attorneys involved in the case are less interested in each case. The rainmaking lawyer and the supervising lawyer does not talk to clients. The young lawyers are generally in the trenches, but the young lawyer's inexperience becomes problematic. In small law firms, a business dispute is commonly delegated to a lawyer with at least ten years of experience. The lawyer appointed to the matter has a vested interest in the case because he is the person working on the subject. Therefore, he wants to win every stage of business litigation.
The small law firm's goal is to minimize the uncertainty of the litigation by exploring all options, possibilities, and probable outcomes. In contrast, the law firms have to appear aggressive to their business clients; therefore, there are no efforts in attempting to resolve the dispute and stopping the attorney's fee. The large law firm's business practice is often near-criminal because the attorney's fee exceeds the money dispute by three-four times. As a matter of common sense, does a business spend $300,000 in legal fees to get back $100,000? This common problem is not disclosed in big law firms. The small law firms often look at their business clients' bottom line. The benefit of the litigation must outweigh the legal cost.