Earlier this week, a lawsuit was filed in the District of Utah’s Central Division by Chicora Life Center and its owner, Chicora Garden Holdings, against their former attorneys, K&L Gates. The billion-dollar firm faces allegations it used fraudulent techniques to boost its billables during a 2016 representation over a failed lease agreement. The complaint alleges the firm billed $1.6 million over six months, despite not being primary counsel on the matter.
According to the complaint, an attorney at K&L Gates told Chicora that the firm teaches an annual seminar to get lawyers to increase their billing. The ABA Journal details the alleged practices:
• Block billing, in which lawyers aggregate multiple smaller tasks into a single block entry. Such billing can inflate total hours billed to a client by up to 30%, the suit says, citing information from a State Bar of California arbitration advisory on detecting bill padding.
• Hoarding, in which an overqualified professional with a high billing rate retains work that could be passed on to lower-paid professionals. “Often, hoarding results in partners doing associate work, associates doing paralegal work, and/or paralegals doing clerical work,” the suit says.
• Multibilling, which occurs when multiple attorneys perform the same task or attend the same event when one lawyer could handle the task.
The complaint alleges that the majority of the drafting in the matter was done by Durbano Law, and K&L Gates was to review those documents. However, the lawsuit alleges, “K&L’s billing records show substantially more time billed for the very documents that Durbano Law initially drafted, with only minimal changes to the papers to show for it.” The lawsuit also says that the Biglaw firm’s “deceptive billing practices” intensified after the lead lawyer on the matter passed away, and a new lawyer took over lead responsibilities for K&L Gates.
As reported by Law360, the complaint also details K&L Gates’s alleged refusal to file an objection in a bankruptcy proceeding which left the company with a $3 million tax liability. The lawsuit alleges breach of contract, breach of fiduciary duty, fraudulent billing, and aiding and abetting a breach of fiduciary duties.
The firm has not yet commented on the lawsuit.
Read the full complaint below.