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taking cases on contingency

Has anybody ever taken a case involving claims of breach of hanssolo1301/05/17
Sure, lawyers take contract cases on contingency. You just jeffm01/05/17
Do you have a feel for where the breach in the asset purchas mtobeinf01/05/17
Alternatively, if you have no clue, run it by an experienced jeffm01/05/17
Be careful. I've handled cases like this. The amount of disc tcpaul01/06/17
Agreed. When I was practicing for the dark side, the name o mtobeinf01/06/17
Also, the contingency makes me think, well Mr. Businessman w mtobeinf01/06/17
Also keep in mind that even if its a slam dunk case -- you s notiers01/05/17
If the other side defends the case - it won't be easy, and i orgdonor01/06/17
Whole thing sounds a little fishy. Don't spend your money on anothernjlawyer01/06/17
As other people have already said, you need to be certain ab bbkbbk01/06/17
We stopped doing contingency cases years ago. ctesq01/09/17
Personally, I find it insulting when a client asks us to tak ctesq01/09/17
I love contingency fee cases. The only way to really make bi southernman01/09/17
hanssolo13 (Jan 5, 2017 - 7:37 pm)

Has anybody ever taken a case involving claims of breach of contract, employment agreement, and license agreement on contingency? A client has a dispute with former business partners involving a breach of assert purchase agreement and breach of patent license agreement. Sounds like its going to be a lot of work, and I've never really heard of a lawyer taking on a breach of contract case on contingency.

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jeffm (Jan 5, 2017 - 8:08 pm)

Sure, lawyers take contract cases on contingency. You just have to have a feeling for what can be recovered in order to make your decision. If you have no clue, then, don't do contingency.

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mtobeinf (Jan 5, 2017 - 8:22 pm)

Do you have a feel for where the breach in the asset purchase agreement occurred. Also, the employment agreement. How familiar are you with contracts? Sounds like a lot of work and if you can't efficiently attack it and litigate accordingly then it may be more than you can chew. Going off Jeffm though depending upon whether the facts and law are in your favor, if it's MM within a level of risk you'd be willing to take and you can be certain of such then it could be worth your while.

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jeffm (Jan 5, 2017 - 8:26 pm)

Alternatively, if you have no clue, run it by an experienced attorney who can co-counsel with you and divide the contingent fee.

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tcpaul (Jan 6, 2017 - 9:42 am)

Be careful. I've handled cases like this. The amount of discovery and motion practice can be insane. I would not do it on contingency. The risk versus reward is likely far too great. To me, it's also a bit of a red flag that the client would want you to do it on contingency. I'd propose a discounted hourly rate with the understanding that you are going to be spending a ton of time on this case. I've had a few of them and it can completely consume you.

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mtobeinf (Jan 6, 2017 - 10:26 am)

Agreed. When I was practicing for the dark side, the name of the game was simple. Overwhelming discovery. Overwhelming motions. Drive up the cost and expense. Fight every single little issue. Have the case last as long as possible, since the insurance company is paying anyway. And watch your opponent get frustrated, overwhelmed, then they start grasping for straws. Once you grasp for straws the magic happens. Because then it's attack mode. Many a small business owner went belly up. Many a discriminated employee remained in an awful spot. The dark side is horrible, but that's the game.

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mtobeinf (Jan 6, 2017 - 10:27 am)

Also, the contingency makes me think, well Mr. Businessman with your asset purchase agreements and alleged employment contracts despite the at-will nature of employment, if you are so special how come you can't pay my fees.

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notiers (Jan 5, 2017 - 8:29 pm)

Also keep in mind that even if its a slam dunk case -- you still have to be able to collect. Its one thing to win and obtain a judgment. Its quite another thing to actually collect the judgment. So if you do decide to take the case - be damn sure that the target defendant(s) have sufficient assets that can be attached and will be able to pay the judgment.

A better idea, depending on the size of the case is to suggest a mixed-fee arrangement (and make sure this is legal in your jurisdiction). For instance, assuming you would typically charge $400 per hour for this work. Suggest a fee structure where you will take a VERY reduced rate of $150 an hour, + a percentage of the recovery on the back end. That way you're not completely screwed if things go south.

Also, make sure you negotiate that the client is responsible for the costs of experts, lit costs, etc.

I once worked on a massive breach of contract/IP case a partner had taken in. Client sold it as a "slam dunk." And it was. A slam dunk for the defendants - case dismissed on summary judgment. about 1 year of work with 4 attorneys and 2 paralegals was lost on this thing - never to be recouped. The partner was subsequently forced out of the partnership. So make sure your client isn't selling you on a load of crap before you take the case.

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orgdonor (Jan 6, 2017 - 10:09 am)

If the other side defends the case - it won't be easy, and if they don't, there's nothing there. Absent some kind of prejudgment security, I would have concerns about a contingent arrangement - unless you're at the kind of huge firm that can swallow a big loss on time.

I am pretty strict about having an insurance policy to go after.

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anothernjlawyer (Jan 6, 2017 - 10:48 am)

Whole thing sounds a little fishy. Don't spend your money on a case where the client won't spend his own.

Agree with notiers: propose a hybrid fee arrangement, and make clear that client has to cover expenses (filing fees, deposition transcript costs, etc..) up front. Also, get a real retainer up front. If client's not willing to do that, forget it.

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bbkbbk (Jan 6, 2017 - 10:55 am)

As other people have already said, you need to be certain about liability, damages AND collectability.

Only take contingency cases where there is insurance available and/or a "shall pay" attorney's fee provision. For example, under the FLSA (where I do the majority of my work) the defendant has to pay my fees if I win. So if they want to drag things out with depos and motions good for them. It only means I make more money in the end. If there is no attorney fee provision you could win and be able to collect but you might have spent so many hours on the case your fee may be effectively minimum wage or lower per hour.

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ctesq (Jan 9, 2017 - 10:51 am)

We stopped doing contingency cases years ago.

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ctesq (Jan 9, 2017 - 11:10 am)

Personally, I find it insulting when a client asks us to take a case on contingency

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southernman (Jan 9, 2017 - 10:26 pm)

I love contingency fee cases. The only way to really make big money.

When I take business cases on contingency, I always insist on a healthy deposit for expenses.

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