So a law firm hires a contract attorney to do document review in a big securities case. They pay the contract lawyer $50 an hour and bill their client $550 for that hour. Is that fair? One lawyer says, “Contract lawyers feel more like a cost that should be simply passed through to the client.”

What say you?

Me? I say that asking if it’s fair is asking the wrong question. Fairness is not the issue. The issue is, “What is the client willing to pay?” Isn’t that the basis of capitalism? Willing buyer and willing seller at arm’s length?

If the client agreed to pay $550 an hour and the work performed by the contract lawyer is of no lesser quality than expected, then who’s to say the client didn’t get its money’s worth? And who’s to say the firm isn’t entitled to make a profit on what they pay outside attorneys? Don’t they earn a profit on work performed by their employees?

Since this was a class action, a judge is being asked to approve legal fees. I’m sure he or she will consider many factors in making that determination. The mark up on contract lawyers shouldn’t be one of them.

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