Veyron wrote:kings84_wr wrote:Veyron wrote:kings84_wr wrote:No referral fees is rough. I know some states require a "fee split" and joint representation language rather then a referral fee. We get around that by requiring each attorney to be equally responsible for representation. But the referred firm does all the work.
My state has language to the effect of "fees must be proportional to the work actually performed." Is your state as strict?
I think mine requires proportional work on the case or joint responsibility for representation. So we get around it, by including a clause in the contract that both firms are jointly responsible to the client (but in the end only the one firm does any work). We've never failed to pay an attorney who referred us a case, and I can't remember a referring attorney ever participating in the case (and frankly we don't want them near it). Generally the standard is 25% Referring atty 75% Referred.
The other state we do a lot of work in, might have language like yours. But to be honest, I have no idea. In the end if we pay out everytime, there's never going to be a fee dispute on our end.
And when it comes to MDLs and mass torts, we get cases from all over the country. Things get a little more challenging in those cases.
Edge of my seat. How do you handle the MDL/mass tort splits?
And how do you tell a client that there will be a referral fee paid?
We are almost always the referral firm. So Normally the referring attorney lets the client know before I ever talk to the client. But it takes some explaining. We have it explicitly broken down in the contract that 25% of the fees will go to x firm 75% will go to our firm.
MDLs are very tricky. There is a firm in our area that basically farms out cases for referrals ( I don't think they eve practice). So they run adds all over the country, screen the intakes, sign them up, and send them to us to do the work. Unless there is a state with very explicit rules, we generally use our same Contract for mass torts all over the country. Not my call, but I have a feeling there are some major ethical issues with the mass tort referrals (considering some states have very specific rules on referral fees). But I think our partners think that as long as we always pay the referring attys, and the client gets the same fee, there will never be an issue.
Another good tip if you ever go to trial , give yourself an extra 5% of the contingency if the case goes to appeal. If you get a nice verdict you need the extra 5% to hire an
appellate attorney. Also don't do your own appeals.
To me the most foreign of referral fees/splits are public adjusters for property insurance/bad faith claims. I don't do this area, but my firm does. And basically the PA has some type of contingent interest in the outcome as a non-lawyer. Not sure how its ethical, but most states allow it.