Shearman's Yukos case and the $1,065 per hour lawyers

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  • Shock, Horror ... Guess what, folks .... If you involve yourself in the biggest arbitration in the history of the world.... it might prove quite expensive!!

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  • The title and first paragraphs of the article imply that lawyers' fees in this arbitration have been excessive, but then the tribunal itself ruled that “In the circumstances, it is unsurprising that the cost submissions of the Parties, as to their amounts, should reflect the very considerable work which each Party was required to expend."

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  • Of course the Tribunal didn't criticise the costs as they themselves were cleaning up with USD5m in fees! Hard to defend 21 "attorneys" on one case, however large.

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  • Anonymous @9:57 am -- have you ever been involved in large-scale arbitration proceedings? I have and 21 attorneys doesn't shock me at all. Discovery alone requires an army of lawyers when it comes to reviewing and analyzing tens of thousands of emails, letters and memos in preparation for arbitration. We're not talking about plain vanilla commercial litigation here.

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  • Ben - yes I have been involved in large-scale disputes and it never ceases to shock me how must is spent on disclosure (which is where law firms make a killing) - if disclosure was being staffed by lawyers rather than paralegals then the clients deserve a refund.

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  • Also I do not understand this line of delineation between "arbitration" and "litigation" - both are dispute resolution mechanisms and cases under either can be large or complex, it is the nature of the dispute that determines this not whether it is resolved by arbitration or litigation.

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  • The point the article makes is that arbitration is not cheaper than litigation. In fact, it is usually significantly more expensive because, for example, arbitrators must be paid and arbitrators lack the authority of judges to control the parties. It is also usually slower..in this case 9 years.
    So, as an alternative to litigation it fails on two of the issues that are of greatest practical significance to clients. Arbitration proponents are generally left arguing about cross border enforcement, party autonomy etc which certainly are advantages of arbitration but are rarely of any real value in practice.

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