Fueled by Weil Gotshal & Manges partner rates in the $950/hour vicinity, “fees for lawyers, accountants and financial advisers in the Lehman case may reach $906 million, according to [bankruptcy lawprof] Lynn LoPucki”. (Bloomberg, Oct. 9). Elie Mystal at Above the Law notes a recent fee survey and concludes that “Lehman is getting the most expensive bankruptcy money can buy”.
Actually, bankruptcy professionals might earn even a very rich keep if they provided a quick and decisive way to allocate losses from the failure, move Lehman assets to their most productive uses and bring relative certainty to all parties. The prospect instead of slow, chancy, and hard-fought wrangling is one major reason why the administratively assisted “speed bankruptcy” model of financial institution reorganization, seen in the Washington Mutual case, has been winning praise from knowledgeable observers (e.g. Alex Tabarrok). If speed bankruptcy seems well suited to the crisis, one reason is that conventional, protracted, lawyer-run bankruptcy seems so ill-suited. More: Roger Parloff, Fortune “Legal Pad”, American Lawyer.
6 Comments
Everybody always uses those eye-popping numbers to show how overpaid people are. They make it sound as if the lawyer is getting that placed right in his pocket. Actually that money probably pays for his lights in the office, the heat, the 4-5 aides that are running around gathering information…oh and maybe his taxes, property and income. Also, it probably pays for that short skirted sweet young thangs health insurance, her retirement…oh and a host of other things.
So, when people bandy about a figure like $950 dollars; you can’t just stop at the gross figure….you have to also add what the lawyers costs are. Then you will get the true figure that he is earning.
Yeah, yeah I know..you are going to gripe about how overpayed he is blah, blah blah. Just think, YOU could be making that kind of money if YOU had gone to lawyer school.
What? You didn’t want to crawl out of your parents basement because you might miss the next Scoobby-doo cartoon? Right, and you want to complain about somebody that is creating wealth….and you are just using up oxygen.
Steve
Hrmm, bankrupcy lawyers … not exactly a breed I think of when wealth creation comes up. Perhaps wealth protection, but not creation.
Come to think of it, that’s pretty much true across the board, I’m having a hard time thinking of any lawyer specialization that actually creates wealth, other than for themselves that is.
Wow Steve, stop to take a breath or something. And have a cup of coffee.
Steve:
1) as I understand it, lawyers generally charge by the hour for their assistants, too.
2) Lawyers also charge for “expenses”, which covers a lot of things
3) the other stuff you list (“lights in the office, the heat…taxes, property”) gets paid for at a much MUCH lesser rate for 99% of the rest of the country. In fact, most LAWYERS charge significantly less than that (say $500 an hour). It’s obscene.
4) Mr Olsen IS a lawyer.
So, your post is left with no accurate content whatsoever. I am tempted to right something insulting here, but I believe your insults cover the situation properly, and I will put a small bit of faith in you to re-read them and see how they apply.
Actually, I’m not a lawyer. I guess I should pipe up more often with an explicit disclaimer to that effect.
It’s Ted that’s the lawyer, not you – my mistake. Sorry.