COLUMN ONE : When the Lawyer’s Bill Is Out of Bounds : A rise in reports of overcharging has raised concern. Most attorneys are conscientious, officials say, but the pressure to push up fees is high.

Randy Blim winced as he pored over the legal bills in his Hollywood office. Tens of thousands of dollars in charges had almost no documentation. When he called his firm’s respected New York lawyer for an explanation, the attorney brushed him off as a rube.

“This is what you get when you hire a big New York City law firm,” Blim said the lawyer chided him good-naturedly.

Blim backed off but resented the lawyer’s superiority. He would later learn that the lawyer had, among other things, dined at client expense at the priciest of restaurants and charged the Hollywood post-production company for a female friend to accompany him on a business trip.

Blim’s dilemma is not uncommon, according to legal fee auditors. Clients often hesitate to challenge their lawyers’ bills because they are uncertain about how much such services should cost and, more significantly, fear alienating a hired advocate.

But legal consultants say there are plenty of reasons for clients to worry. Many lawyers inflate their bills, whether by charging $1 a page for a facsimile that costs the firm 15 cents or by charging for a paralegal when the work was performed by a lesser-paid secretary. In some cases, the offenses are more egregious.

Even the American Bar Assn. acknowledges the problem. “One major factor contributing to the discouraging public opinion of the legal profession,” the association wrote in guidelines issued in December, “appears to be the billing practices of some of its members.”

Thirty-eight percent of 270 lawyers responding to a 1991 survey of a cross-section of the American Bar acknowledged that clients are occasionally billed for work not performed, and 17% admitted they had charged more than one client for the same work. Most common, according to fee auditors, are charges for unnecessary work or for training less-experienced lawyers.

Most lawyers are conscientious, said Lawrence J. Fox, an ABA official who helped write the overbilling guidelines, but the pressure to bill hours, combined with the economic downturn, has “created an environment” that may encourage some lawyers to bill for more hours than they work.

“The number of reported instances of billing abuses has increased,” Fox said.

About 3,000 billing disputes in California were assigned to private arbitrators last year. In one small program run by the State Bar, California lawyers were found to have overcharged last year in at least 33% of 128 disputed cases.

A federal judge in April castigated the prestigious Los Angeles law firm of Gibson, Dunn & Crutcher for charging for repetitive and unnecessary work and excessive hours in a bankruptcy case.

Particularly galling to the judge: Gibson’s $99,000 charge for time spent preparing its bill. The firm launched an internal investigation of the case. “We are certainly looking at what happened,” said Gibson managing partner Ronald Beard. He said he knew of no past instances of overbilling. “This is the only time I’m aware of” such a problem, he said, adding that the lawyer who oversaw the case left the firm last fall.

Even one of the nation’s top law enforcement officers was implicated in overbilling. Associate Atty. Gen. Webster L. Hubbell resigned this year amid reports that his former Little Rock firm was investigating him for inflating his legal charges in Arkansas.

At Laser-Pacific Media Corp., lawyer Lewis Eslinger had initially impressed executives, including Blim, a senior vice president.

A hefty man with silver-streaked hair combed straight back and monogrammed shirts, Eslinger oozed confidence and competence, Laser-Pacific executives said. He also possessed a credential that meant a lot to the Hollywood company: He had represented Sony, an industry giant.

According to Laser’s new attorneys, Eslinger was supposed to prevent competitors from infringing on its patent for converting video from the American television standard to the European standard. He filed lawsuits against the competitors on Laser’s behalf, and they, in turn, filed counterclaims against Laser.

His bills, “reasonable” at first, became “enormous” as the months stretched into nearly two years, Blim said.

“There was no itemized breakdown of the bills, just line items with the dates and a big dollar amount,” Blim recalled, sitting in his modest office, where cardboard boxes of legal files line one wall.

Laser-Pacific lost its patent battle. A federal judge ruled that the patent was invalid, forcing Laser to spend more than $1 million to settle its competitors’ claims.

Reeling from the losses, the company eventually instructed the Los Angeles-based firm of Kindel & Anderson to sue Eslinger and his law firm, Cooper & Dunham, for malpractice.

“This case is an example of a client who really got intimidated by his lawyer,” said Manuel Klausner, Laser’s attorney in the malpractice action.

Eslinger should have told his client that he had qualms about the strength of its case, Klausner said, so the company could have settled and avoided losses.

Eslinger, reached in New York, declined to comment, citing the pending litigation. His lawyer in the case also declined to comment.

In preparing for the lawsuit, filed in January, 1993, Klausner and his colleagues eventually obtained the receipts for Eslinger’s expenses--which were later entered into court records.

They were staggered by some of the charges. While visiting Los Angeles, the lawyer and others had dined lavishly at Laser-Pacific’s expense--L’Orangerie, $561, Jimmy’s, $474, L’Ermitage, $306.

He had racked up a $547 charge for dinner for nine at a New York restaurant and played golf in Phoenix at the company’s expense, although Laser-Pacific had no business there.

He also submitted charges for air fare for the female friend and hotel, rental cars and groceries for his wife, according to Laser’s new lawyers, and billed the company $116 for a Chinese takeout meal delivered to his house.

For one day, Eslinger billed Laser-Pacific and other clients a total of 25 hours.

In sworn depositions, Eslinger said he had inadvertently charged Laser-Pacific for some expenses, but properly charged the company for meals where Laser’s case had been discussed. He could not always remember, however, who had dined with him on those occasions.

“He said he tabulated his expense charges while watching television,” Klausner said.

But in the eyes of Barry Kaiman, a Los Angeles lawyer representing Eslinger’s firm, the dispute boils down to “an unhappy client trying to shoot the messenger that brought the bad news.”

Kaiman refused to comment on the propriety of the bills, but said Laser-Pacific had disputed only $17,000 of the New York firm’s approximately $100,000 in expenses. Klausner called that estimate “vastly understated.”

Consultants who audit lawyers’ bills said extravagant spending for travel and meals is less common than other billing abuses. They traced the excesses to the 1980s, when the legal profession, like the rest of the economy, was booming.

Law firms grew, and the new bureaucracies became more expensive to run. Some firms began charging for office overhead. Photocopying became part of the profits. Clients noticed curious charges on their bills: “HVC”--heating, ventilation and air conditioning--or word processing (typing) or filing.

One attorney recalled that during the 1980s, she and others in her San Francisco firm would go to lunch and decide at the restaurant whose client would be billed for it. Sometimes two or three attorneys would attend, sometimes many more if they were celebrating a birthday.

“Everybody does the lunch,” said the lawyer, who asked that her name not be used. “You say: ‘I had to go out to lunch to discuss your case with a partner.’ You try to be ethical. You talk about the client for 10 or 15 minutes and then you have a nice lunch. We used to do it once a week.”

Only the rich clients got soaked for those meals, she said. Now she is working for a firm that represents poorer people, and the expensive meals and first-class travel are gone. “Now I stay at Holiday Inns and below,” she said.

Lawyers usually bill by the hour. Rates vary widely, but tend to range from $85 to $400 an hour. An associate at a small San Francisco firm told Santa Rosa litigation consultant Jim Schratz that a senior partner instructed him to bill for any time he thought about a case, even if it was in the shower.

“When you are getting paid by the hour,” legal bill auditor Gary Greenfield said, “there is an inherent inefficiency. The more time you spend, the more money you make, so there is a disincentive to be efficient.”

Associates, usually the less experienced lawyers in a firm, are fired if they do not meet minimum billing requirements. Some resort to billing for more time than they work. An hour may become an hour and a half.

“The pressure (to bill) is unbelievable, oh unbelievable,” said a young San Francisco attorney who left private practice because she could no longer endure it. She is now a government lawyer.

She said her former associates frequently padded their time and thrived on minimum billing requirements, a common practice whereby firms do not bill for any time less than 10 or 15 minutes.

“A lawyer may write a one- or two-sentence letter: ‘Enclosed are responses to the interrogatories. Please get back to me,’ ” said Greenfield, founder of Oakland’s Litigation Cost Management. “That is a 45-second letter that gets billed for 15 minutes. That is a widespread practice.”

Clients began watching their legal bills more carefully when the economy turned bad, and insurance companies hired auditors such as Greenfield to go into law firms and comb their files.

Such scrutiny stemmed some of the abuses, but many continue.

U.S. Northern District bankruptcy Judge Edward Jellen cited several billing abuses by Gibson, Dunn & Crutcher when he decided in April to disallow half of its $1.35-million bill for representing creditors in the bankruptcy case.

If the hours billed were correct, the judge calculated, a senior attorney at the firm had reviewed a mostly boilerplate retention agreement “at the incredible rate of 14 minutes per page, or 4.3 pages per hour.”

Attorneys are allowed compensation in bankruptcy cases for the costs of preparing fee requests. But Jellen complained that the Los Angeles firm’s $99,000 charge for compiling the bill was a “staggering” 7.3% of its fees in the case.

Gibson “is not entitled to be compensated for overhead, general record-keeping and accounting, or multiple reviews of the same material by numerous attorneys,” Jellen wrote. “It is also not entitled to be compensated for the excessive time that an army of paralegals spent reviewing and redoing each other’s work.”

Legalgard Inc., one of the biggest legal auditing firms in the country, has found that some firms charge more when the client is not paying particular attention to the bills.

John J. Marquess, chief executive officer and general counsel of the Philadelphia-based firm, calls it “cost-shifting.”

He said Legalgard’s audits since March showed the following:

* A Phoenix firm charged a client $1 million for creation of a database that “had nothing to do with the client’s business.” Although the longtime client eventually would benefit from the system, so would other clients.

* A Philadelphia lawyer charged for time in depositions that he did not attend.

* A Cleveland lawyer charged a client for the purchase of a suit when he ran out of clothes during a trial. “The response was, ‘Get them dry-cleaned,’ ” Marquess said.

* A New York City law firm submitted a bill for $500,000--half of it for educational conferences.

* A Miami firm charged a client $2,000 for preparing his $40,000 bill.

Many lawyers also tend to train young associates or new lawyers at client expense, consultants said. When a lawyer leaves a firm or moves onto another project, the client may be billed for the hours it takes the new lawyer to become familiar with the case.

Firms also may charge for a partner’s time to review an associate’s work, part of the training process for new lawyers that consultants say should be taken into account when billing.

Although clients want their lawyers to be prepared for all possibilities, some consultants believe that firms do more work than is necessary when the client’s potential liability is low. “Unfortunately, big law firms are in the habit of giving a Cadillac defense in cases that require only a Chevette defense,” said Schratz, the Santa Rosa consultant.

Challenging a lawyer about a bill often saves the client money.

“Most of them will very quickly cut 25% of the bill,” said John W. Toothman, founder of Devil’s Advocate in Virginia, a litigation consulting firm that examines legal bills, “especially if they think it will repair the relationship and keep your business.”

State bar associations try to guide lawyers in appropriate billing. The California State Bar is developing recommendations based in part on guidelines from the American Bar Assn.

According to these guidelines, lawyers should not charge for normal overhead but may for photocopying, computer research, secretarial overtime and telephone calls if the charges reflect the actual costs to the firm or the client has agreed to them in advance.

Lawyers also should not charge more than one client for the same work. For example, an attorney who spent four hours at a courthouse for three clients on the same day may not bill each of the clients for four hours, the ABA said, even though each case by itself would have required four hours.

A lawyer who flies across the country for one client and works on the plane for another may not bill both clients for that time, according to the guidelines. Nor should a firm charge a client for research when it is recycled work done for another client.

The State Bar of California said it received 865 allegations of legal fee improprieties last year and referred some of the complaints to arbitration. A Bar spokeswoman said figures were not available on how many lawyers were disciplined for improper billing.

Lawyers who blatantly overcharge clients are occasionally prosecuted. A 30-member San Jose law firm recently pleaded guilty to 12 counts of felony mail fraud after prosecutors accused its partners of telling the accounting department to add arbitrary time on bills. The firm primarily practiced workers’ compensation defense law.

Some counties, including Los Angeles, have discovered fraudulent billings by attorneys appointed by the court to represent indigents. Six Los Angeles criminal defense lawyers agreed in 1986 to settlements totaling $129,500 for allegedly overbilling the county.

In the patent case, Laser-Pacific received bills from the New York firm for about $1 million. After Laser sued for fraud and malpractice, the New York firm filed a counterclaim for unpaid fees and expenses of about $500,000.

As the negotiations dragged on and the depositions mounted, the New York firm agreed to remove all of Eslinger’s time and expenses from the bill--about $400,000. He was the lead lawyer, but others in the firm also worked on the case.

It has yet to be resolved. Laser’s new lawyers are seeking at least $2 million and potentially $60 million in damages. A trial was scheduled for this month, but the case may be settled out of court.

“A lay person in a litigious society is, to some degree, defenseless,” said Emory Cohen, Laser-Pacific’s president. “If you find you can’t necessarily trust your lawyer, where are you?”