Why would any law firm client be willing to pay more than the agreed upon billing rate? Why would any law firm agree up front to discount its rates for clients who are unhappy with the service they received? Well at least one law firm is banking on being on the winning side of this billing strategy.
The firm, The Rimon Law Group, is a relative newcomer to the â€œvirtual law firmâ€ space. Based in the Silicon Valley, Rimon is the brainchild of two large firm ex-pats, Michael Moradzadeh and Yaacov Silberman . Both practiced corporate law at the law firm Ropes and Gray until they reached the conclusion that they could better serve technology clients using a different model. While they were accustomed to working with highly credentialed lawyers, they realized that there is a large group of former large firm attorneys who have chosen to live in less expensive locations (and are therefore able to provide high quality services at greatly reduced fees.)
Rimon brings together the talents of lawyers who have at least 10 years of large American firm training. Some are in the U.S. living away from major urban centers and some are Americans who have chosen to move to Israel and other countries that enjoy a lower cost of living.
In speaking with Michael Moradzadeh, it struck me that Rimon’s business model relies on many of the principals on which IPEngine was founded (i.e. that client work should be performed at the least expensive location where quality can still be achieved ).
Rimon will undoubtedly continue to experiment with ways that it can increase client satisfaction; but right now, the firm is beginning to tweak the way it charges for its services. The founders of Rimon both believe that a pure model of hourly billing creates the wrong incentives for lawyers. At the same time, it can be difficult to estimate how many hours a transaction will require before the transaction is well under way so flat fee billing can be difficult to estimate.
Rimon has therefore chosen to stick with the hourly model; but clients who agree to complete a client satisfaction survey at the end of an engagement can enjoy up to a 20% discount if they are unhappy with the firm’s responsiveness. At the same time, clients who sign on to this program also agree to pay up to a 20% â€œtipâ€ if they are particularly happy with the results, the service, the level of professionalism, etc.
It’s a creative approach that is bound to pay dividends; but I guess I better check back in six months. Like all good ideas, what works on paper doesn’t always work in practice.