How Legal Contingency Fees Work

How Legal Contingency Fees Work

There are many costs associated with litigating a business or class action case. It can take quite a bit of attorney time, and between filing costs, depositions, expert testimony, and related costs, it will add up quickly. The largest cost that most often comes to mind is the attorney fees.  When you put it all together it can be quite expensive. Perhaps more importantly, the client bears the risk of losing the benefit of all of those costs because there is never 100 percent certainty you will win the case.

Whistleblower law on a court desk.

Contingency Fees: How They Work

One way to quell these fears is engaging a firm that offers contingency fees or blended contingent fee arrangements, as it helps solve the problem of upfront costs by shifting much of that risk onto the law firm. It allows the client to take care of legal fees and expenses at the end of the case if there is a recovery.  If there is no recovery, there typically are no costs the plaintiff needs to cover..

In order to accommodate clients who cannot pay all the upfront costs of hiring a lawyer or who chose to shift that risk to the law firm, the firm  may accept a fixed percentage of the client’s settlement or award in the event of a recovery. During the entire legal process, the law firm assumes all the costs involved with the case. If the client wins the case or gets a settlement, the law firm will then be paid from the agreed upon percentage, plus the cost of the litigation expenses. Other kinds of blended fee arrangements can also be utilized to shift only part of this risk to the law firm, while helping the client maximize any recovery.

These kinds of arrangements far better align the client’s interest with the law firm’s interests as compared to pure hourly rate fee arrangements. Contingent fee lawyers have every possible financial incentive to quickly, efficiently and aggressively litigate the case to maximize their client’s recovery and, therefore, their own recovery. While it puts more pressure on the law firm, they can earn a better fee because the more the client is compensated, the more the lawyer is compensated.  And if there is no recovery for the client, the lawyers will not get paid.

In contrast, lawyers that get paid by the hour have a strong financial incentive to maximize how many hours they can bill the client, potentially extending the length of the case and decreasing the efficiency of obtaining the desired result.  Those lawyers are not at much financial risk. They get paid no matter the result for their clients.

This is why lawyers that represent plaintiffs are often willing to engage in contingent or blended fee arrangements whereas lawyers that represent defendants typically bill on an hourly basis.

Be in It for the Long Haul

Contingency-based law firms provide the legal might whistleblowers need to take on the biggest names – without the fear of running out of funds. A whistleblower claim with strong merit may be hampered by a multi-national corporation, who, with deep-pockets bully many from pursuing what is right. With a contingency law firm, however, you never have to back down.

Thinking About Blowing the Whistle?

If you or someone you know is thinking about blowing the whistle on something they have witnessed, make sure you have the right law firm in your corner. At Evangalista Worley, we have the knowledge, the expertise, and the confidence to handle your case on a contingency basis, meaning if you don’t win, you don’t pay. It is that simple. Do not hesitate to give us a call, schedule a visit, and consult with our team to analyze your situation and decide upon the best course of action. Call us at (404) 205-8400 today for a consultation.

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