What is the Likelihood That My Retainer Will Be Exhausted?

At Minc Law, we understand that costs and billing are at the forefront of clients’ minds when they engage us. We strive to be as transparent as possible about how your money is being used and key factors that may affect the depletion of your initial retainer fee. By understanding these factors, you can ensure a smooth and transparent relationship with your attorney here at Minc Law and maximize your legal engagement.

While the chances of exhausting your retainer depends on your unique internet-related matter and situation, the following factors and types of cases may cause your retainer to be used faster, including:

• The type and complexity of the case,
• Client interaction frequency,
• The volume or extent of news articles,
• Revenge porn cases,
• Sextortion cases,
• The volume of content and removal requests,
• Necessary research and contacting sites, and
• Data organization and tracking.

In this article, we will break down the factors that might cause your retainer to run low and offer insights to help you make informed decisions.

Understanding Retainer Agreements

A retainer fee agreement is more than just a payment; it is a commitment between a client and an attorney, setting the stage for the work ahead. At Minc Law, this agreement is the primary way we handle payments for services rendered.

So, what is a retainer fee exactly? It is an advance payment you make to secure an attorney’s time and services to work on your matter. This fee is not one size fits all and may vary based on what work you and the attorney agree will be done.

Once you have paid the retainer, that money goes into its own special account (a trust or IOLTA account). The law firm uses this account to take out money for their work. Think of it as putting down a deposit for the legal work that will be done later. Once the retainer is paid and work begins, the attorney will charge their hourly rate against the retainer.

For standard and evergreen retainer agreements, every month, clients will receive a detailed bill explaining what has been done to further their matter.

For an in-depth explainer on retainer fee agreements and their benefits, please see our comprehensive resource ‘What is a Retainer Fee Agreement & How Does It Work?’.

Types of Retainers & Fee Agreements We Use at Minc Law

At Minc Law, we use two types of retainer agreements and a minimum fee agreement to cater to the diverse needs of our clients. These agreements have their own unique characteristics that can influence how quickly they are used.

Broadly, these agreements at Minc Law fall into two main categories: those tailored for litigation, which includes standard and evergreen retainers, and those designed for hourly tasks, primarily covered by minimum fee agreements (MFAs) and occasionally standard retainers.

To provide a clear understanding, here are the primary types of retainers we use:

Standard Retainers

A standard retainer is a flexible payment agreement that can be used for either hourly tasks or litigation matters. It is worth noting that while it can be used for litigation, it is less common because litigation fees often exceed the initial retainer amount.

This type of retainer is distinct from the two types of retainers below. Clients receive monthly invoices against their standard retainer, and if there is money left over once the job is done, clients will receive a refund.

Evergreen Retainers

An evergreen retainer is a payment agreement where clients need to replenish the retainer amount regularly, typically on a monthly basis. This ensures that there is always a set amount available for the ongoing legal work. These are used specifically for litigation matters.

Minimum Fee Agreements (MFAs)

An MFA, is a minimum fee agreement. This is where we require a minimum starting fee as an advanced payment to begin work on your matter right away. While it may help to think of MFAs as a retainer because they are an advanced payment, they actually differ in several ways. For example, we generally consider MFAs to be non-refundable, and unlike standard retainers, they are not held in a trust. This form of advanced payment is used in its entirety for legal work, regardless of the work completed or hours worked. Usually because of the value and expediency of the services being provided. MFAs are used primarily for hourly tasks, especially those that require immediate attention and particular skills and experience (such as sextortion matters).

While there is a fixed minimum fee with MFAs, clients may still owe additional funds if their attorney’s time spent on a particular matter exceeds the minimum amount.

Factors That Affect the Likelihood of Exhausting Your Retainer For All Matters

While we have covered specific factors relating to different types of retainers and cases, it is essential to understand that every legal matter is unique. External influences, unexpected developments, and other unforeseen events can influence the pace at which a retainer is used.

Understanding the Complexity of Your Matter & Scope of Legal Services

Legal matters are not created equal. The nature and complexity of a case significantly influence the amount of time and resources an attorney will need to allocate.

Litigation matters are generally more complex than hourly ones. This means an attorney will typically spend more time on research, drafting documents, or appearing in court.

It is also crucial for clients to consider if their matter is straightforward or if potential hurdles could arise. The presence of obstacles or unexpected twists can increase the duration of a case, subsequently impacting the retainer. For instance, an unexpected counterclaim or a challenging witness could significantly alter the expenses associated with a case.

While attorney fees are a significant portion of the costs, clients should be aware of the other expenses that may arise. These could include court filing fees, charges for a process server, bills for other professional services (like expert witnesses), subscription costs for content platforms, and invoices from local counsel or other cooperating attorneys.

The Attorney Working on Your Case

The financial implications of a legal matter can be influenced by who is working on your case. An attorney’s expertise, reputation, and experience can dictate their hourly rate. In addition, support staff such as paralegals and law clerks come with their respective rates.

Our attorney and support staff rates can be found under the FAQ about pricing in our article, “Cost of Minc Law’s Internet Defamation Services.”

For example, a Senior Partner working on a matter for 10 hours at $600/hour will cost $6,000, while an associate attorney working on a matter for 10 hours at $275/hour will cost $2,750. Depending on who is working on your matter, the cost could vary, which directly affects how quickly your retainer might be exhausted.

Continuing Work

It is not uncommon for clients to shift to an inactive status after some time. In such scenarios, clients might decide to temporarily halt the proceedings, requesting their attorney to hang onto the retainer funds. They may adopt a “wait-and-see” approach, and instead of actively pushing the matter forward, they opt to observe the situation for a while.

Depending on the agreement, these funds might remain untouched for the duration or may be incrementally used for minimal work or updates.

It is important for clients to be clear about their intentions and maintain open communication with their attorneys during such periods. This ensures that both parties are aligned in terms of expectations and financial considerations.

Factors Affecting Likelihood of Litigation (Standard & Evergreen) Retainer Being Exhausted

Litigation, by nature, tends to be unpredictable and can often be more costly than initially expected. Most litigation retainers, including evergreen retainers, are generally used up.

The Nature of Litigation Retainers

A litigation retainer acts as a starting point. Think of it as an initial down payment, covering basics like filing the initial complaint and serving the defendant. It is often exhausted as the case progresses.

Response From the Defendant

If a defendant decides to settle quickly after being served, the costs may remain within the initial retainer. However, this is not common. If the defendant decides to contest the suit, especially through an attorney, the costs begin to mount, leading to further depletion of the retainer.

Case Specifics Impacting Budget

Each litigation case is unique. Factors like where the case is filed, the locations of the parties, whether the defendant has legal representation, and the depth of discovery processes can impact costs. These specifics can quickly cause the retainer to be used up.

Comprehensive Budget Considerations

At Minc Law, we provide clients with a clear picture of potential litigation costs. While every case is different, we typically advise clients that for most uncontested John Doe lawsuits that are limited in scope and/or settle quickly, average total costs for typically range between $15,000 to $20,000. For contested lawsuits that are complex in scope, appropriate litigation budgets should range between $4,000 to $6,000 per month for the duration of the case. If the case proceeds to trial, it is possible to see total trial costs in most cases, including prep, range from $30,000 to $60,000, depending on the scope of the work and personnel involved.

Factors Affecting Likelihood of Hourly Retainer Being Exhausted

Hourly retainers and MFAs hinge largely on the volume and complexity of the work.

Type & Complexity of the Case

Different cases demand different levels of attention. Simply put, the more work and time an attorney invests in a matter, the quicker the retainer depletes. Cases that demand extensive research, evidence review, or correspondence with other parties will invariably use the retainer faster.

Client Interaction Frequency

While consistent communication is vital, clients who require more frequent updates can accelerate retainer exhaustion. It is a balance between staying informed and allowing the attorney the space to work.

The Volume or Extent of News Articles

Dealing with news articles has its own unique challenges. The volume of articles matters; more articles mean a quicker depletion of the retainer. Even if there are just one or two articles, if the background work is extensive or contact with publishers becomes prolonged, this consumes the retainer quickly.

Revenge Porn Cases

Think of revenge porn retainers as an initial budget. Factors that speed up retainer exhaustion include:

• The volume of unlawful content,
• Time-intensive searches, especially reverse image searches which may uncover more content than initially presented by the client, and
• Immediate action is required due to ongoing harassment or urgent issues.

Sextortion Cases

Sextortion cases are particularly unpredictable. If the case veers from the typical scenario, like “Sugar baby” cases or those that need settlement agreements, the retainer can be used quickly. Persistent sextortionists, frequent communication, or extensive removal efforts contribute to faster depletion.

Content Volume & Removal Requests

The more content there is to handle, the higher the likelihood that the retainer will be exhausted. Attorneys might initially set a higher retainer, anticipating the workload.

Research & Contacting Sites

Different sites require unique approaches and often extensive research to find the right contact points. While this task might often fall to paralegals or law clerks with lower rates, it still impacts the retainer.

Data Organization & Tracking

Keeping track of all data and links, especially in cases with vast amounts of content, is essential. Entrusting this to paralegals or law clerks can help manage costs, but this organizational work is another factor that impacts the retainer.

What is the Likelihood That My Retainer Will Be Exhausted?

Many clients wonder how much of their retainer will be used during the legal process. In truth, it varies. Based on our experience, we often find ourselves invoicing clients for additional services more frequently than refunding for unused portions of the retainer.

For hourly matters, if there is a remaining balance, clients may be entitled to receive a refund. However, this is subject to several factors and should be discussed with your attorney. For MFAs, which again, are not actually retainers, refunds are not available since they are deemed “earned” when a client signs their engagement agreement.

It is essential to approach legal services with a clear budget in mind. While the exact cost can be challenging to pinpoint from the outset, having a financial blueprint can be helpful. This understanding can alleviate potential surprises and stresses later in the process.

Effective communication with your attorney is also crucial regardless of the legal matter. It ensures that you are on the same page about expectations, costs, and the trajectory of your case. Take the time to discuss your concerns, ask questions, and ensure you understand the probable costs involved. By doing so, you can confidently navigate the legal process, knowing you are making informed decisions every step of the way.

What Happens After My Retainer is Exhausted?

After your retainer is exhausted, your attorney will reach out to you to discuss if you would like to continue with your matter. If you wish to proceed further, that attorney’s hourly rate will be billed against your retainer (which will require replenishing). You can find a list of our attorney’s hourly rates on our Pricing Page, however, they generally fall between $300 to $600 per hour.

At the end of each month, clients will receive an itemized list with details of the work performed on their matters. It will also include the amount from the retainer that was billed against and its remaining balance. We recommend that all clients review these invoices carefully and reach out to their dedicated attorney if there are any questions or concerns.

For further reading, please see our comprehensive resource ‘What You Need to Know About Your Minc Law Invoice‘.

Get Started With Your Defamation or Sextortion Matter Today

If you are the target of defamation, sextortion, or other forms of online harassment, we understand that trying to wrap your head around the billing process in addition to resolving your matter can add extra stress and confusion. That is why we aim to be as transparent as possible about our billing practices and ensure that all clients fully understand their engagement agreements and the work performed by our dedicated team.