Equal Justice for all - depending on your net worth

There is a fascinating article in today's Washington Post about the expenses run up by the law firm defending Jeffrey Skilling, ex-executive of Enron Corp and soon to be convict. The firm represented Skilling for 5 years and was paid $23 million by Skilling personally and $17 million from his insurance.

Nevertheless, the law firm is reporting a loss, said by one source as more than $25 million beyond what has been paid. The bill is so huge that Skilling can not pay even though he departed Enron with millions - we don't know exactly how much but the Feds put a hold on $60 million cash and other assets, a $5 million mansion and a $350,000 condo in Dallas (used only for visiting their daughter while she was in college).

Defense lawyers will ask that most of this money be released to Skilling since, as one of the lawyers sweetly points out, "He wants to take care of his family and his lawyers." Well, the man does have his priorities.

Why such huge expenses? The five full partners who worked on the case cut him a break and only charged $500/hr, while much of the work was done by junior partners who charged as little as $200/hr. Much of the intellectual grunt work, especially the research, was probably done by paralegals who get paid - oh, I don't know, maybe $40 an hr? (What the firm bills for their work is different than what they are paid for the work, I believe).

"There wasn't a lot of second-guessing" among the firm's policy committee, the chairman of Skilling's law firm said. "We felt an obligation to our client. . . . .It was the right thing to do for our client and the smart thing to do for our firm."

I can imagine. It is somewhat like asking me, as an expert on the middle ages, when the Roman Empire ended. I spend 100 hrs researching the question, preparing charts, graphs and cross referenced indexes, and then say "AD 476". You know that this will hold up in court because ... well, because I have a PhD and work at a college, so I must be an expert.

So I bill you $20,000 because I am a busy little expert and my time is worth $200/hr. And it is - if we all agree that it is. Let's say you are broke and can only pay me $5,000 @$50/hr. I say, OK, if that's all you have. Then I pocket the money and complain about how I lost $15,000 on you.

The disturbing thing is: this is real money, and the lawyers and paralegals have real intelligence and talent, all devoted to cases like this. The final payoff to the State, our society, and our economy?

Absolutely nothing.