Skadden fights contract lawyer’s claims in the U.S. Second Circuit

1 June 2015 – Last week the U.S. Second Circuit heard the Lola vs. Skadden, Arps, Slate, Meagher & Flom case which is testing whether some purportedly professional work might in fact be eligible for overtime. The case pits Skadden against a contract attorney hired by a legal staffing agency to review documents for $25 an hour on a Skadden case.

A district court judge dismissed the case in September, ruling that the work Lola did qualified as practicing law under North Carolina guidelines. “As junior associates at law firms well know,” U.S. District Judge Richard Sullivan in New York wrote in the decision, tasks like confirming citations and looking for typos “are the bread and butter of much legal practice.”

Lola appealed, and last Friday a three-judge panel in the Second U.S. Circuit Court of Appeals heard arguments from both sides. The appellate panel seemed sympathetic to Lola’s case.

Under federal labor laws, licensed lawyers can’t earn overtime pay for work in excess of 40 hours a week if what they are doing is considered legal work. But Lola says he deserves overtime pay because the tasks he did were so basic they shouldn’t qualify as practicing law.

Some bits from the Wall Street Journal report on the case:

1. Contract attorneys are hired on a short-term basis across the legal profession to review reams of documents during the initial phases of litigation and investigations, and many feel they are underpaid.
2. Lola’s lawyer, D. Maimon Kirschenbaum, has another attorney overtime case pending as well, and contract attorneys are using Lola’s case as a rallying cry to raise awareness of what some see as unfair working conditions for document reviewers.
3. Valeria Gheorghiu attended Friday’s arguments along with other members of United Contract Attorneys, a group that is working to improve the pay and benefits of document reviewers. Gheorghiu said Saturday that contract lawyers often work shoulder-to-shoulder in crowded rooms, sometimes without access to phones or the Internet out of privacy concerns by clients. Some work sites prohibit talking, she said, while others post lists of rules dictating what kind of food can be eaten in the review rooms and when bathroom breaks can be taken.
4. The current system can be demoralizing particularly for law school graduates saddled with debt who can’t find a way out of the contract attorney cycle.
5. Such positions typically pay around $25 or $30 an hour and don’t provide benefits — far below the $160,000 starting salaries for many full-time junior lawyer jobs.
6. Lola sued Skadden and legal staffing agency Tower Legal Solutions in New York federal court in July 2013, alleging he deserved overtime pay for the extra hours he worked on a document-review assignment in North Carolina. Lola said his job involved using predetermined search terms to sort documents into categories with the assistance of prompts by a computer, and to occasionally redact words.
7. “The legal services industry has for years been exploiting individuals with law degrees looking for short-term work,” the suit said.
8. A appellate panel on Friday seemed sympathetic to Lola’s case. If Mr. Lola’s work truly was as basic as he said it was, asked Judge Raymond Lohier Jr., and could nearly be replaced by a computer, “How in the world is that the practice of law?”
9. The work was more complicated than that, said Brian Gershengorn of Ogletree, Deakins, Nash, Smoak & Stewart, P.C., who argued for Skadden and Tower. “Lola can’t take away the fact that he’s trained as a licensed attorney,” Gershengorn said.
10. The judges also pressed Skadden’s counsel on why there shouldn’t be a federal standard for what qualifies as the practice of law, as Lola suggests. Lola’s counsel, D. Maimon  Kirschenbaum, told the court that he thinks the definition of law practice should include “some engagement of legal judgment or application of legal knowledge,” which he says his client didn’t need for his $25-an-hour gig. Speaking after the arguments, Kirschenbaum said a ruling in favor of Lola would “open the gates for people to get their wages.”
11. Some legal observers say, however, that a win for Lola could lead to a decrease in available positions if law firms and corporations choose to bring the work in house or hire paralegals or others without a law degree to do the work instead.
12. Lola’s suit isn’t the first time courts have been asked to weigh in on overtime pay for lawyers. A similar suit Kirschenbaum brought against Quinn Emanuel Urquhart & Sullivan LLP and staffing company Providus has been on hold until the Second Circuit rules in the Skadden case.