Citigroup General Counsel Blasts High Hourly Rates

A recent article in the on-line version of the ABA Journal reported that Citigroup's General Counsel, Michael Helfer, has no patience for big firms whose top partners would seek to charge him $1,000/hour. Helfer noted that the economic downturn has forced Citigroup to cut its in-house legal staff by 300 people and to cut the salaries of some of the survivors by as much as 60%.

In the current economic environment, “the amount of sympathy I have for the argument that $1,000 an hour is a reasonable rate ... is nil,” Helfer is reported to have said as a panelist at a recent conference in Washington, D.C., on the future of the billable hour.

The article goes on to note that other panelists at this conference reported that the percentage of revenue derived from alternative billing arrangements at some venerable Wall Street law firms ranged from 10% to as much as 20%. One BigLaw partner, however, noted that they are still not very good at making alternative fees profitable -- or at least as profitable as the traditional billable hour.

UPDATE: Just found an AmLaw Daily article that discusses, in a little greater detail, the same conference. This article notes that Helfer reported that about 30% of Citigroup's legal fees are alternative fee arrangements.