Legal Fee Audits

Before Jim Schratz and Associates is retained by either a client or a law firm, I review the invoices to determine if an audit is justified. There is no charge for this service. In about 15-20 percent of the submissions, I inform the potential client that I do not believe an audit would be useful. In the remaining submissions, I advise the client there are certain “red flags” of possible billing issues and suggest an audit. I then perform a “full-scale legal fee audit, which includes the following:

    > Inputting the invoices into a computer

    > Coding all entries

    > Generating computer reports

    > Review of all computer reports

    > Review of all available work product including, but not limited to, all pleadings, correspondence, deposition transcripts, trial transcripts, etc.

    > Unlimited consultation with you and/or the client to generate any custom reports you desire to assist in the analysis of the invoices

    > Drafting an expert report

    > Unlimited consultation with you and/or the client in preparation for trial

    > Attendance at any or all depositions of the factual or expert witnesses to assist in cross-examination, if appropriate

    > Providing trial testimony

    > Unlimited consultation with you and/or the client in connection with post-trial activity, including possible appeal by either party

Why a Full-Scale Audit?

In a full-scale audit, I can tell you how much time was spent on any particular pleading by the law firm, and then review the pleading itself. Did the pleading involve novel or complicated issues of law or facts? Was the pleading a rehash of a prior pleading?

I also read each deposition and note the beginning and ending times and compare that to how much time the attorney billed to attend the deposition. Did the deposition start at 10 a.m. and end at noon? If so, why is the attorney billing six hours to attend?

Jim Schratz and Associates does not perform “bill reviews” or just audit a sample of the invoices. Those kinds of reviews are not fair to the client or law firm. If somebody only looks at the invoices, they have no basis to comment on whether the attorney inflated the amount of time the attorney spent at a deposition; nor do they have any basis to comment on whether the attorney spent too much time drafting a routine pleading.

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Success Stories

In Department of Fair Employment and Housing v. United Dominion Realty (Case Nos. 07CC12067, 02CC12069), the court accepted our audit findings, stating that:

“In awarding fees in these amounts, the court has fully accepted the declaration of James P. Schratz in opposition to the motion, including all of his recommended reductions. The court finds his qualifications to be impressive. Likewise his reasoning as to why the fees sought are excessive is persuasive.”

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