Jan 16, 2008

Is it anything like a reverse Pac-man?

pacman.jpgWhat's a reverse contingency fee? Unlike a regular contingency fee (which is based on how much the lawyer recovers), a reverse contingency fee is based on how much the lawyer saves the client--for example, if a $10 million judgment is reduced to $2 million, the lawyer's contingency fee would apply to the $8 million reduction. For that reason, the reverse contingency is not uncommon among appellate lawyers. The principle has also been approved by the ABA ethics committee. Can a lawyer convert a regular contingency fee agreement into a reverse contingency fee? It's possible ... but not when the client denies knowing about the arrangement. Oops.

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