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Litigation: Using billing surveys to determine “reasonable” rates

Resources for evaluating hourly rates for particular matters or attorneys

The Supreme Court has stated that a reasonable hourly rate is generally equated to the prevailing market rate for attorneys providing comparable services. The fact that a client is willing to pay rates in excess of market rates does not necessarily make the higher rates reasonable or appropriate, particularly where the charges will be passed on to third parties who may have a contractual obligation to indemnify. As the 1st Circuit has stated:

A law firm’s customary schedule of charges, though entitled to consideration, is not dispositive of the issue; a private client might be willing to buy a Stradivarius when a Guadagnini would plainly do, or to pay top dollar for either when the same instrument could be purchased less expensively elsewhere. The court must, therefore, turn a realistic eye on the proffered pricing, endeavoring to fashion rates ‘adequate to attract competent counsel but which do not produce windfalls to attorneys.’ U.S. v. Metropolitan District Commission, 847 F.2d 12, 17 (1st Cir. 1988).

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David McMahon

David McMahon is the Managing Partner in Barger & Wolen LLP’s San Francisco office. His practice focuses on large complex litigation. He has worked on...

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