How Do Personal Injury Lawyers Get Paid?

In this podcast episode, Josh and Aaron talk about the fee structure for personal injury attorneys. Listen in to learn what lawyers mean by “no win, no fee” and how FVF Law handles things a little bit differently than other law firms. Listen here or read the transcript below. FVF’s Summary Judgment podcast is available wherever you listen to podcasts including Apple Podcasts, Spotify, iHeart Radio, and more.

Intro: Thank you for tuning into Summary Judgement where Austin’s personal injury attorneys Josh Fogelman and Aaron Von Flatern of FVF Law discuss the ins, outs, and in-betweens of personal injury cases.

Aaron Von Flatern: Alright, welcome back to Summary Judgement. This is Aaron Von Flatern and I’m here with my law partner, Josh Fogelman, from FVF Law, and we are broadcasting virtually from our offices still in quarantine here in 2020. Today, Josh and I are talking about the topic of how much do car accident lawyers charge? And I think a lot of people have got some idea from TV but they may not understand why car accident lawyers charge what they charge and exactly how it works. So Josh, why don’t you just get us started with kind of an overview.

Josh Fogelman: Yeah, so generally speaking, car accident lawyers charge what’s called a contingency fee and the contingency fee simply means that a lawyer’s payment is contingent upon a successful resolution of a personal injury case. You oftentimes hear this couched as a no win, no fee type situation because literally if there is not a successful financial recovery for the client then the lawyer does not earn any fee at all. So that’s just generally speaking how a contingency fee works. One of the main benefits, of course, of a contingency fee and why we also work on a contingency fee and why we think that that’s the best and most fair way to proceed for a personal injury case is simply that we don’t believe that people, who have been harmed by the carelessness of somebody else, should suffer an immediate and direct or really any financial burden at all just to have access to their legal rights, just to get good and adequate and, in our situation, excellent legal advice.

So by taking on some of the risk with the client and not putting the client in a position where they’re going to be paying a retainer or paying an ongoing hourly bill, you have a relationship where you’ve created sort of a partnership with the client, where your interests are actually directly aligned. Both parties are wanting to do their best to secure the maximum financial recovery that the law will allow because the lawyer is going to get paid a percentage of that and the client wants the lawyer working for that cause so that, of course, the client can be made whole.

Aaron Von Flatern: I like the way you used the word partnership, that’s something that I really believe in with our clients. These cases can be risky. Sometimes they don’t work out and it makes sense that we should all take that risk together. And also that helps us stay honest as a law firm when we’re signing up cases, for example. If you’re in a partnership with somebody you want to be with someone you can work with. And so, as a law firm, we’ve always tried to work with clients that we found especially likable. And so, our number one criteria is that we have a client that we enjoy working with and that’s likeable. And that’s not just because of our working relation, it’s also because it affects the outcome of the case. Can you talk a little bit about that, Josh?

Joss Fogelman: Yeah, well, one thing that I also want to add is that when… One of the big, I think, questions that a lot of personal injury clients have, especially when they learn more that the lawyer is going to be taking a percentage and so forth, and so on, people get concerned that they’re going to be left with nothing. And unfortunately, there are some law firms out there who look after their own interests before they look after their client’s interests. And there are situations, we’ve heard of a lot of horror stories of clients being left footing the bill at the end of a case when their lawyer took a really large fee after a really horrible situation. But that’s not how it has to work and really that’s not how it should work. What we’re always looking for, I would say, at FVF Law is not just, well, what is the value of this case, what kind of recovery are we going to be able to secure for our client at the end of the day? We really want to figure out how we can add value to our client’s case. And there are really a variety of different ways that we have been able to successfully do that time and time again.

Kind of the two major ones that I would at least focus on for purpose of this podcast and this video is the fact that a good qualified personal injury lawyer, that has the resources to do a great job litigating somebody’s case or helping a client understand their rights and options, will help them understand how to leave no stone unturned, and really do everything in their power to make sure that every single element of damages that a person can recover… In other words, all of the different categories of harms and losses that a person can receive compensation for, we make sure that we’re exploring every single one of those categories to the fullest so that we know at the end of the day, every single harm and loss is going to be compensated. We also, of course, have a good reputation for taking cases to trial when insurance companies try to be the ones that drive the valuation of cases, that tends to be at the expense of the client and we find ourselves pushing back against that quite a bit and we’re not afraid to try cases. But I think insurance companies understand which lawyers have the reputation for taking them to the mat and which lawyers have the reputation for settling quick at their client’s expenses. And we definitely have the reputation for taking them to the mat.

And so when we’re giving an evaluation, we’re fair and honest about that. And I think you’ll agree with me on this, one of the probably most overlooked ways that a good personal injury lawyer can really add value to a client’s case is doing all the work on the back end. It’s not just about going and actually getting all the money that we can get to help make our clients whole. It’s also fighting all of those people who have their fingers in the pie at the end of the day. You’ve got health insurance companies that want to get paid back. You’ve got hospitals who have put liens on cases. You have doctor bills. These things can take a huge bite out of a person’s recovery if they’re not really careful and we understand and know the tools that are out there and available to fight back against some of these abusive billing practices in some instances, and make sure that we beat those liabilities down in the back end in a way that balloons our client’s net recovery out of any sort of a settlement.

Aaron Von Flatern: Yeah, and I think that’s all excellent information. One thing that potential clients may wonder about is if you’ve got a law firm that can go all the way to trial… They’ve seen trials on TV. There are experts. There are people who have taken measurements and done accident reconstruction. The surgeon is going to come testify which may cost a fortune and the client may be thinking, “Well, how can I afford to pay for all the experts and all the stuff that goes on to create a trial because it looks like a big production?” Can you talk a little bit about that?

Josh Fogelman: Yeah, so one of the main benefits, of course, of engaging a personal injury lawyer or at least trying to find out whether you should hire a lawyer is the fact that if you, as a personal injury victim, even if you know your rights, even if you’re a practicing lawyer, and know your rights so thoroughly, oftentimes, that’s not enough to get the job done. Unfortunately, if you’re the one asserting a claim for a monetary recovery because of your harms and losses, you have the burden to prove what those harms and losses are and it’s just a costly endeavor and so rather than… You can easily imagine a circumstance where… We’ve had circumstances where going and trying to recover money for our clients has required us to come out of pocket tens of thousands if not hundreds of thousands of dollars just to prove the case, and there’s just no question that many people can’t afford to do that on their own, which puts them at a huge disadvantage if they’re trying to go down that road and take on an insurance company with their own resources. So partnering with a law firm in the right set of circumstances will completely eliminate that burden and eliminate that disadvantage and put the client on an equal playing field with the big insurance company whose job it is to pay them as little as they can get away with.

Aaron Von Flatern: If I could just put in my two cents here, if someone’s shopping for a lawyer, I would highly recommend that they take a little time and check out their online reputation. If you can tell that the firm cares about its online reputation as FVF Law does, and I think you could see from our reviews that our clients care about us. If you can tell the lawyer cares about that, then you know the lawyer is going to be working in your best interest because their job then is to make you happy, right? If they’re leaving you high and dry, if they’re taking all the money out of a settlement and not leaving you with any, then they’re probably going to have a bad online reputation, and such a great place to start obviously, checking out their website and find out if they have the qualifications to actually go to trial.

That’s the other big one because insurance companies definitely do that. As we know, of course, I used to be an adjuster. A lot of our lawyers used to be adjusters and they do their own snooping and they figure out which lawyers go to trial and which lawyers don’t. And I promise it changes the value of the case because they have to decide whether or not they’re going to spend the money to defend the case, and they also have to decide whether or not they can face 12 members of our community on something where someone’s been seriously harmed because of someone else’s negligence. So just my soapbox for a second. But I think that’s another big piece of this before you go partnering with somebody, make sure that they have a good reputation.

Josh Fogelman: Yeah, and I guess in summary, we’ve talked a lot about how the contingency fee works and what the advantages of a contingency fee are and the benefits, of course, of partnering with a reputable personal injury lawyer. But something that I guess is really important for our viewers and listeners to understand is in addition to a lawyer only getting paid in the event that there is a recovery, a positive outcome for the client, all of those costs that we talked about, those are treated as an advance. So if the law firm is unsuccessful for some reason in recovering for the client, the client’s not going to be left to foot those bills. So, what are important to sort of piggyback on what you were saying, Aaron, making sure that you’re choosing a lawyer with the proper reputation and making sure that you choose a lawyer who has the proper resources and is going to be prepared to roll the dice when it’s the right thing to do for the client and really put the money out, that needs to be put out to properly invest in their client’s case, can have a substantial impact on the case’s outcome.

Aaron Von Flatern: We hope this has been helpful. This has been Summary Judgement once again and we look forward to the next time.