A US firm which tried to claim more than £1,100 an hour for a top fee earner has been scolded by the Court of Appeal.

Cleary Gottlieb Steen & Hamilton LLP had accepted the sums claimed were well in excess of guideline hourly rates but told the court this was ‘almost always the case in competition litigation’.

Lord Justice Males, ruling on the costs issue in Samsung Electronics & Co. Ltd & Ors v LG Display Co. Ltd & Anor, said this was ‘no justification at all’ for charging such high amounts. ‘If a rate in excess of the guideline rate is to be charged to the paying party, a clear and compelling justification must be provided,' he said. 

‘It is not enough to say that the case is a commercial case, or a competition case, or that it has an international element, unless there is something about these factors in the case in question which justifies exceeding the guideline rate.’

Mr Justice Males

Lord Justice Males says parties must provide 'clear and compelling' proof that costs are justified

Source: Photoshot

The firm had represented the successful respondent in the appeal and submitted a schedule claiming costs of almost £73,000. These included the costs of its solicitors, who bill in US dollars, claiming costs at a rate of between US $1,045 and US $1,475.75 per hour for Grade A fee earners and between US $578 and US $918 for Grade C fee earners. At the conversion rate used, these are equivalent to charges between £801.40 and £1,131.75 for Grade A and between £443.27 and £704 for Grade C.

As the appellant pointed out, these were well in excess – and in some cases more than double – the recommended £512 hourly rate for Grade A fee earners and £270 for Grace C fee earners in heavy commercial and corporate work.

Males said this was a one-day appeal where the only issue was the appropriate forum for the trial and where the documentation was not heavy. The amount claimed came to a ‘modest’ £900,000.

The judge accepted the respondent’s submission that it allocated work to more junior members of the team where possible but reduced the amount claimed to £55,000.

 

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