Trial lawyers cost us a few % points from the GDP by taking 30% from each lawsuit that they win or settle. This money takes away from victims in legitimate suits, and individuals or shareholders in frivolous ones. But why is it always 30% when some lawsuits are a slam dunk and take 10 minutes of research and a phone call to settle for millions of dollars, while some are very complicated and risky taking thousands of hours and a high risk of losing? It is always 30% because the trial lawyers have fixed the price and act like any trust to keep the price inflated.
What we need is some kind of brokerage firm that screens lawsuits and then puts them up for competitive bids from law firms on an eBay type system. A simple case with a big potential reward would have a tiny commission. A complicated case might even have a greater than 30% commission. But the whole thing would become more rational.
Lawyers would be forced to work more efficiently like the rest of the world, and this would be good for everyone. If they all boycotted the system we would have an anti-trust case.
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I wish I had thought of this very clever idea myself ... the question is: how does one move it from the realm of the possible to that of the actual?
That just the problem with the legal system. In many countries, laywers are charged by the hours they spent on a case instead of a percentage of what they get.
By putting a lawsuit for bidding, you will never know whehter a good and responsible lawyer will get you case. If you pay less, surely you'll have to compromise on the quality you get from the lawyer you appointed.
The other problem with this is that a brokerage company will charge you a fee for assessing the case. So the victim will end up paying more.
Maybe I wasn't clear about this. you still get a percentage of the case so the lawyers will still work hard. its just that the percentage is negociable. so when you sign up for a big class action law suit the lawyers don't take 30% from each person even though they are not doing anymore work. They would probably get around 5% a person depending on how likely the lawsuit would be to win.
One problem I have always had with contingent fees is the economic incentives they create. Because a lawyer stands to make about a third of any settlement or judgment, it is in her best interest to seek the greatest amount of money. This means she should try to find the next big case and to take down someone with big pockets. Under the current system, a trial lawyer dream should be finding an easy case worth lots of money.
There is a noble rational behind contingent fee though. The trial lawyers association argues that without such fees, poor people would be unable to bring suits. They further argue that a lawyer has to be able to profit for a winning case so that she can afford bring other tougher cases.
I propose a compromise. Rather than getting a percent of the settlement or judgment, a winning plaintiff’s attorney should be awarded three times her regular hourly fee. There are already situations in which reasonable fees are awarded. This new system would just be an extension of those rules.
Under the new system, a plaintiff’s attorney could still afford to take a tough case without worrying about bankrupting herself. In fact, she could break even if she lost two out of every three cases. However, the economic incentives would be to work hard on whatever case is before you rather than to find the perfect moneymaker.
Hourly billing doesn't seem to make sense either. In that instance, it appears that the way the lawyer makes more money is to keep the case open as long as possible. That only leads to backlogged trial dockets and promotes inefficiency. Instead, payment should be based on value provided. If any individual believes that the fee being charged is inflated, I suggest they report the lawyer (plaintiff or defense) to their state bar office of disciplinary counsel.
Hmmm... thought provoking idea(s), for sure!! Someone's actually "thought" of a legitimate solution!
Potential inherited problems with the proposed solution as I think quickly about this might be: who would this "panel of experts" be? How would they be hired, picked, etc.? Oh, great! Yet ANOTHER layer to bureacracy! While I agree with the general idea, it's ACTUAL benefit would then - again - be the subject of one of the articles within this website!!! The issue is ethical and moral behavior... which apparently cannot be expected to exist anymore. It went the way of the dinosaur apparently!