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Friday, April 12, 2024 | Back issues
Courthouse News Service Courthouse News Service

Insurer Cries Foul Over Legal Fees

LOS ANGELES (CN) - The Latham & Watkins law firm gouged a chemical company by charging $450 per hour for work done by legal students, and refuses to submit to arbitration its $21.8 million bill for four years of litigation, an insurance company says.

Century Indemnity Co. agreed to pick up part of the tab to defend Montrose Chemical Corp. of California against a toxic spill lawsuit. But Century says Latham racked up millions in unnecessary fees.

"For the most part, the team of 15 attorneys and 11 staff spent their time reviewing the same things and then billing to confer among themselves about what they had reviewed," according to Century's petition to compel arbitration.

Century says it paid 26.83 percent of the fees, totaling $5.8 million, in accordance with an agreement among Montrose's insurers.

Century claims that Latham used a highly inflated fee scale to defend Montrose, compared with similar work it performed for other area clients. Latham billed Montrose a flat rate of between $380 and $450 per hour for work performed by any attorney - whether they were partners, associates, or legal students who had not yet passed the Bar exam, according to the petition. Latham also allegedly billed from $160 to $210 per hour for work done by paralegals.

On similar cases, Latham allegedly paid $180 per hour for partners, $140 per hour for associates, and $75 per hour for paralegals.

During January 2006, one of Latham's billing "attorneys" was a "Bar-pending law graduate" who claimed 137.1 hours that month at a rate of $450 per hour, Century says." Century says the paralegals spent most of their time that month on clerical work that would normally be part of a firm's overhead costs.

Latham also allegedly refused to specify how attorneys used their time, instead listing general tasks such as "reviewing," "communicating" and "meeting." And Latham allegedly refused Century's request for arbitration.

Century is represented in Superior Court by H. Douglas Galt with Wolls & Peer.

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