Legal Blog

The End of Quinn Emanuel and Uber’s Relationship Indicates that Dynamic Companies Need Dynamic Pricing Models

Earlier this summer, details emerged about Quinn Emanuel Urquhart & Sullivan LLP’s decision to withdraw from its relationship with Uber Technologies Inc., in the midst of Uber’s recent flurry of controversies—which include a leadership shakeup, concerns over consumer data privacy, and numerous instances of alleged sexual harassment. The Quinn–Uber split points to an entirely different issue: legal billing practices and rates and client resistance to them.

 

Documents filed in the course of Uber’s ongoing dispute with Waymo LLC reveal that the international law firm ceased working with Uber due to “rates that were not financially viable for [the] firm.” Quinn Emanuel represented the company for four-and-a-half years, a period during which the ridesharing giant experienced global, explosive growth.

 

Law360 reports:

 

“While calling the four-and-a-half year relationship between Quinn and Uber and their legal wins ‘an honor,’ [Quinn partner Stephen] Swedlow didn’t mince words about why the relationship was coming to an end.

 

Swedlow, a litigator and Chicago office manager, cited Uber’s need to control litigation costs and a ‘preferred counsel’ program under which Uber required Quinn to accept fixed prices for distinct litigation tasks like answering a complaint or drafting a settlement.

 

Those prices — the amounts are redacted from the July 20 filing — are ‘below the threshold’ for the firm’s financial needs, and didn’t lead to hoped-for, higher-rate litigation work.”

Even Big Clients May Find Big Law Pricing Unaffordable

Theoretically, a company like Uber and a law firm like Quinn Emanuel should enjoy a relationship with no real budgetary impediments. Uber generates billions of dollars in revenue each year, while Quinn Emanuel regularly appears toward the top of lists such as The American Lawyer’s “Firms Ranked by Profits Per Partner.” A moneymaking firm and a globally dominant client seem made for each other.

 

However, Quinn Emanuel’s decision to walk away from Uber comes at a time when in-house counsel is turning a skeptical eye toward traditional outside law firm pricing models. As Andrew Strickler writes in his Law360 analysis, “the Quinn withdrawal highlights a persistent disconnect between general counsel’s ongoing legal budget discipline and BigLaw pricing”:

 

“In-house counsels’ legal budget push, increasingly driven by data analytics and tougher outside counsel guidelines, means many corporate clients are cutting the volume of work going out of house.

 

Seeking budget predictability, many are also ‘unbundling’ legal tasks going to outside firms, allowing for more granular pricing and targeted discounting. Others are also moving work to lower-rate shops or dramatically reducing their approved outside counsel lists.”

 

In other words, the relationship between Quinn Emanuel and Uber was unsustainable for both parties. The law firm’s old-fashioned pricing model kept the firm from meeting the client’s needs for flexibility and transparency.

The Alternative: Tailored Legal Services, Billing Discipline, and Reasonable Hourly Rates

A number of dynamic and growing law firms, including Offit Kurman, tailor engagements to each client’s needs. Many organizations we serve choose to work with Offit Kurman to take advantage of our firm’s ability to provide customized, cost-effective access to a comprehensive suite of legal services.

 

Offit Kurman maintains fair hourly billing rates, geared to providing the highest level of legal services while reasonably compensating its attorneys. Our firm is able to maintain reasonable rates in part because its unique compensation structure encourages collaboration between members of our team and the right staffing of matters. Free from the fear of losing business to internal competition, attorneys can bring the correct colleagues onto cases to provide clients with the greatest possible value. We put clients’ legal needs first.

 

To learn why businesses consider Offit Kurman the perfect legal partner®, and to see what our firm can do for your organization, contact us.

ABOUT EDWARD TOLCHIN

Edward Tolchin is a Principal and Chair in the firm’s Government Contracting practice group. Mr. Tolchin’s practice is focused on government contracting, business litigation, and technology matters.

In government contracting issues, Mr. Tolchin represents prime and subcontractors in contract negotiation and formation matters and in disputes involving both government and commercial business issues. He has been involved in procurement cases before many of the federal and state boards of contract appeal, Government Accountability Office, Small Business Administration, United States Court of Federal Claims, Court of Appeals for the Federal Circuit and other federal and state courts across the United States.

Join Mr. Tolchin for CYBERSECURITY – The Human Firewall. Learn how to strengthen your organization’s human firewall and why cybersecurity is important for government contractors. Register Here.

 

 

ABOUT OFFIT KURMAN

Offit Kurman is one of the fastest-growing, full-service law firms in the Mid-Atlantic region. With over 140 attorneys offering a comprehensive range of services in virtually every legal category, the firm is well positioned to meet the needs of dynamic businesses and the people who own and operate them. Our eleven offices serve individual and corporate clients in the Virginia, Washington, DC, Maryland, Delaware, Pennsylvania, New Jersey, and New York City regions. At Offit Kurman, we are our clients’ most trusted legal advisors, professionals who help maximize and protect business value and personal wealth. In every interaction, we consistently maintain our clients’ confidence by remaining focused on furthering their objectives and achieving their goals in an efficient manner. Trust, knowledge, confidence—in a partner, that’s perfect.

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