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Metrics create benchmarks for 'granular' evaluations of lawyer performance

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Indiana Lawyer Focus

Metrics measuring attorney and law firm performance have exploded in recent years, and trend watchers say the implications for the industry are only beginning to be felt.

“Corporate legal departments want to make sure they’re getting a fair value, and from a law firm perspective, when they’re being asked to bid on work, they’re going to ask, ‘What are my peers billing?’” said David Moran, senior director of data management and analytics for White Plains, New York-based TyMetrix.

The company since 2010 has published the Real Rate Report, which distills data based on American Bar Association billing codes, by market and by whether billed work was done by associates, partners or paralegals.

benchmarks-facts.jpgTyMetrix’s benchmarks on such measures are culled from more than 50 billion aggregated data entries on electronic invoices submitted through its affiliated billing software. Firms agree to allow TyMetrix to anonymously use the data.

Moran said the data would allow someone working on a real estate matter or an Employee Retirement Income Security Act case, for example, to track benchmarks for phases within the typical life cycle of a case from discovery to settlement or resolution. In short, the data provide a guide for how long certain tasks should take and how much they should be expected to cost in various markets.

Getting to that “granular level,” Moran said, was revolutionary less than five years ago, but it’s become a reality of the legal marketplace. Insurers and corporate legal departments, he said, “are asking more for early case assessments – what is the expected cost and duration based upon the given facts?”

“We always understand not everything can be boiled down to one data element,” he said. Nevertheless, “with a large amount of data, you can see a pattern.”

Veteran defense and plaintiffs attorneys have mixed feelings about the trend but acknowledge it’s here to stay.

“The majority of lawyers still know nothing about this,” said Lewis Wagner LLP partner John Trimble, who has given presentations on behalf of DRI – the Voice of the Defense Bar on how metrics are changing the profession.

Metrics as a buzzword in the legal community seems to have been met largely with shrugs or groans, but it’s “a word I’ve come to hate,” said Kightlinger & Gray LLP partner Richard Young.

“If they had a question, I wish they’d just pick up the phone and call,” Young said of clients’ billing issues. He questions the value of benchmarks for matters that have unique sets of facts and participants.

“It’s not a one-size-fits-all world,” he said. “I don’t know if my client’s going to be wonderful to work with or if it’s going to be like pulling teeth to get information.

“You don’t know everything when you take a case in,” Young said.

But data is the driving force of changes that Trimble warns will only intensify. He said lawyers and firms should know how they stack up in comparison to their peers on measures that they’ll increasingly be rated on. Wise firms will see their

performance on metrics measures as a marketing opportunity, he said.

“Businesses are becoming better con-sumers of legal services, and as they’re becoming better consumers, they’re becoming more selective” about who they retain, Trimble said.

“What’s happened more recently in the business world and the insurance world is they’re using analytical software to harvest information on a firm-by-firm basis,” Trimble said. “The key metrics for law firms and individual lawyers are how long was the case opened from the date of referral to the time it was closed; and second, how long did it take the lawyer or firm to move from opening the file to a decision point” on whether a case should settle or proceed to trial.

Trimble said he’s heard of companies retaining a firm but singling out individual attorneys the companies didn’t want working on its matters based on the company’s internal data analysis.

Thomas Zurek, senior vice president and general counsel for American United Life Insurance Co. in Indianapolis, said many firms are modeling their practices on metrics and he’s explored doing the same, but decided against it.

“I find that it is not all that helpful in our business,” Zurek said. “I have a small cadre of firms around the United States that I use. I’m very familiar with their firms, and in addition to that, I practiced law for 26 years and I have my own sense of the value of things.”

Zurek said value can only be measured in beneficial results. Metrics based on a collection of benchmarks “doesn’t fit with the calculus I have for determining if proper value has been obtained,” he said.

“I could be paying someone the equivalent of $200 an hour, and if I should have been paying $500 an hour to get the proper result, the $500 an hour is cheaper at the end of the day,” Zurek said.

Roy Tabor, founding partner at the Tabor Law Firm LLP in Indianapolis, said from a plaintiff attorney’s perspective, metrics may have some limited value.

focus-billing.jpg“It’s fine if those are benchmarks, but when they become the standard or the rule, that becomes a problem,” he said. Data “is only as good as the input,” he said, and programs can’t make room for variances, such as the deposition scheduled for an hour that drags on for several more when unexpected information comes to light.

Tabor said statistical analysis of legal matters is always going to require exceptions to allow for cases that are outliers and by their nature will take longer to resolve. “I sort of lament the loss of the notion that the practice of law has a bit of art as well as science to it,” he said.

Young has no doubt that metrics will continue to play a larger role in business and insurance litigation. But he said quality firms are already doing most of the things the metrics encourage.

“Our philosophy has always been the earlier you can evaluate a case and tell a client or an insurance carrier where they ought to go with it … the faster you can do that, the happier your client is going to be and the more efficient the handling of the case is going to be,” he said.

Young doesn’t criticize clients who review bills, but he said too much reliance on metrics could have the unintended consequence of adding time reviewing invoices. Most of the time, he said, billing issues are resolved with an explanation of why a matter wasn’t routine.

“I’ve never had them call up and say I didn’t spend enough time on something,” Young said.•

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  1. What a fine article, thank you! I can testify firsthand and by detailed legal reports (at end of this note) as to the dire consequences of rejecting this truth from the fine article above: "The inclusion and expansion of this right [to jury] in Indiana’s Constitution is a clear reflection of our state’s intention to emphasize the importance of every Hoosier’s right to make their case in front of a jury of their peers." Over $20? Every Hoosier? Well then how about when your very vocation is on the line? How about instead of a jury of peers, one faces a bevy of political appointees, mini-czars, who care less about due process of the law than the real czars did? Instead of trial by jury, trial by ideological ordeal run by Orwellian agents? Well that is built into more than a few administrative law committees of the Ind S.Ct., and it is now being weaponized, as is revealed in articles posted at this ezine, to root out post moderns heresies like refusal to stand and pledge allegiance to all things politically correct. My career was burned at the stake for not so saluting, but I think I was just one of the early logs. Due, at least in part, to the removal of the jury from bar admission and bar discipline cases, many more fires will soon be lit. Perhaps one awaits you, dear heretic? Oh, at that Ind. article 12 plank about a remedy at law for every damage done ... ah, well, the founders evidently meant only for those damages done not by the government itself, rabid statists that they were. (Yes, that was sarcasm.) My written reports available here: Denied petition for cert (this time around): http://tinyurl.com/zdmawmw Denied petition for cert (from the 2009 denial and five year banishment): http://tinyurl.com/zcypybh Related, not written by me: Amicus brief: http://tinyurl.com/hvh7qgp

  2. Justice has finally been served. So glad that Dr. Ley can finally sleep peacefully at night knowing the truth has finally come to the surface.

  3. While this right is guaranteed by our Constitution, it has in recent years been hampered by insurance companies, i.e.; the practice of the plaintiff's own insurance company intervening in an action and filing a lien against any proceeds paid to their insured. In essence, causing an additional financial hurdle for a plaintiff to overcome at trial in terms of overall award. In a very real sense an injured party in exercise of their right to trial by jury may be the only party in a cause that would end up with zero compensation.

  4. Why in the world would someone need a person to correct a transcript when a realtime court reporter could provide them with a transcript (rough draft) immediately?

  5. This article proved very enlightening. Right ahead of sitting the LSAT for the first time, I felt a sense of relief that a score of 141 was admitted to an Indiana Law School and did well under unique circumstances. While my GPA is currently 3.91 I fear standardized testing and hope that I too will get a good enough grade for acceptance here at home. Thanks so much for this informative post.

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