Fair Division of Attorneys' Fees
24 Pages Posted: 29 Aug 2018 Last revised: 15 Oct 2018
Date Written: August 14, 2018
In complex litigation involving multiple law firms, courts often face the unenviable task of dividing attorneys' fees. Often, courts fall back on the so-called lodestar method, which has significant drawbacks and creates poor incentives. In this Article, we propose several new methods for addressing the fee division problem. In particular, our proposal is to use peer reports of each firm's relative contribution to the litigation and then apply either optimization or statistical methods to estimate a "fair" or consensus division of the attorney fees. The methods explored have lower informational requirements than found in previous work and importantly appear to be robust to collusive behavior by the firms.
Keywords: Attorney Fees, Fair Division, Lodestar, Complex Litigation, Mass Torts, Bayesian Methods, Optimization
JEL Classification: C11, C61
Suggested Citation: Suggested Citation