Dec 18, 2007

Killing Me (Micro)Softly

bill-gates.jpgHow much was a Minneapolis law firm awarded in legal fees for suing Microsoft? $65 million. That's how much judges awarded the Zelle Hoffman law firm in three antitrust cases against the software giant.

How much do Zelle Hoffman's top attorneys charge per hour? $750. How much does Microsoft's top attorney charge per hour? $1000.

How much was the Townsend and Townsend law firm awarded in legal fees for winning a lawsuit against Microsoft? Approximately $30 million. How much did the law firm request? $92.5 million.

Why are these fee awards so astronomical?
(a) The judges who make these awards use Macs and hate PCs
(b) The judges can't figure out how to use Excel spreadsheets
(c) The judges are basing the awards on Bill Gates hourly rate, or
(d) The judges are making the awards in Bill Gates dollars.
Actually, it's none of the above. Judges use what's called a 'lodestar' calculation. The attorney hours are multiplied by the attorney's hourly rate and that number is multiplied by the lodestar (which is supposed to represent the "risk" of suing Microsoft and losing).

What was the lodestar sought by the Townsend law firm? 5.5. In other words, a Townsend lawyer who charges $500 an hour would have earned $2,500 an hour. What lodestar did the judge award? 2.0, so that same Townsend attorney would only earn $1,000 an hour. "Obviously, we're disappointed," said Townsend's lead attorney. Yeah, obviously.

What did consumers get as a result of the Microsoft lawsuit? Vouchers for Microsoft products worth $5 for each copy of Microsoft Word they purchased, $16 for each copy of Microsoft Windows and $29 for each copy of Microsoft Office. Hmm. Maybe that explains why Bill earned $291,549,774.24 today.

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