Yesterday, I attended the International Women's Insolvency and Restructuring Confederal (IWIRC) Annual Spring Program. The featured event was entitlted, "A Conversation with Trailblazing Women in the Insolvency Field." Moderated by the Hon. Marjorie Rendell of the 3rd Cir. Court of Appeals, the panel's participants incuded Norma Corio of JPMorgan Chase, Marcia Goldstein of Weil Gotshal & Manges, Hon. Barbara Houser, Chief Bankruptcy Judge, N.D. Texas, Hon. Mary Walrath, Bankruptcy Judge, District of Delaware, and Bettina Whyte of Alvarez and Marsal. The program opened with a parable. A man cuts himself shaving in the shower. He wonders out loud what is wrong with the razor. A woman cuts herself shaving in the shower. She wonders out loud what she did wrong.
Author: Lois R. Lupica
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Time is Money
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A consistent theme running through the Consumer Bankruptcy Fee Study focus group discussions is the increased time it takes attorneys, post-BAPCPA, to take a consumer debtor from initial consultation to filing. As one attorney observed,
[BAPCPA has] … triple[d] … the time it takes to prep a case. I mean, in lots of cases, where you could have gotten a couple of months of pay stubs, put them in there, seeing the [the debtors] don't make any money right now and filed a bankruptcy case within a fairly short period of time, now it takes … a lot more staff time … to chase down six months of pay stubs, to get them entered into the system, to look at [them, and] if they are over median, that increases the time. So in a case … they are over median and close to that line, it probably triples or quadruples the time it takes to get them ready to file.
In a preliminary analysis of Fee Study data (and I stress, preliminary) 87% of attorneys "strongly agreed" that it takes more time to represent a Chapter 7 consumer client now, than it did before BAPCPA's enactment.
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One Consumer Bankruptcy System, or Many?
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As Principal Investigator of the Consumer Bankruptcy Fee Study, I've been gathering "qualitative data" from attorneys, trustees and judges about how the consumer bankruptcy system is working. I have conducted over a dozen focus groups, many, many one-on-one interviews, and have been privy to myriad list-serve threads discussing the costs of BAPCPA generally and more specifically, consumer bankruptcy attorney fees.
Here is one preliminary observation: there is a huge disparity with respect to how and how much attorneys are paid, depending upon where in the country they practice. This is not a shocking revelation on its face, given the disparities in the cost of living from city to city. The data reveal, however, variations that go beyond big city=expensive, small town=cheap.
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The Consumer Bankruptcy Fee Study
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Thanks to Katie and my friends at Credit Slips for the guest blogging gig. I appreciate the invitation and the opportunity.
In my next couple of posts, I am going to report on the Consumer Bankruptcy Fee Study (see Katie's post below). Today, I'm making a pitch to the consumer debtor's attorneys who have received (or will receive) an invitation to participate in a survey about their consumer bankruptcy practices. To date, the Consumer Debtor Attorney Fee Survey has been distributed to ~400 lawyers who represent consumer debtors. I expect to send out a couple of additional "waves" in the next weeks. As I said in my cover note,