Tag Archives: outrageous legal fees

Paging Willie Sutton

When asked why he robbed banks, the infamous bank robber Willie Sutton famously explained “Because that’s where the money is.”

Maybe Willie should have gone to law school instead.

Why?  Read on.

Once upon a time, Starbucks decided it wanted to be more than the coffee people take to the office and drink awkwardly over first dates; it wanted to be the coffee people drink at home, in an iced variety in their car, and more.  Going retail takes more than a great product, though:  it requires a distribution network, and instead of creating your own network for a limited product line, it makes more sense to hire someone who already has that distribution network to do the distribution and sales for you.

So Starbucks hired Kraft, which helped Starbucks grow a boffo retail business.

At some point, Starbucks decided it wanted to part ways with Kraft, so it filed for divorce.  The tortuous rationale for Starbucks’ decision and Kraft’s counter-arguments read like a season’s worth of episodes of Falcon Crest, and since The Curmudgeon could never follow Falcon Crest and those arguments are not terribly relevant to this particular tale, he will dispense with attempting to recount them.

The point is that a judge recently granted the divorce and established its terms:  Starbucks, which knew from the start it would owe Kraft a great deal of money, must pay Kraft $2.23 billion in damages.

And $527 million for legal fees.

Let that soak in for a moment:  $527 million in legal fees for a dispute that began in November of 2010 and ended three years later.

And now we shall repeat that:  $527 million in legal fees for three years of work.

$527 million – which, by the way, if you’re into breaking down such figures, amounts to more than $480,000 a day for three years, including Sundays and holidays.

What in the world could those lawyers possibly have been doing to justify $527 million in legal bills in just three years?  Are we talking about the law firm made famous by the Marx Brothers?  You know:  Dewey, Cheatum & Howe?

So it turns out Willie Sutton had it all wrong.  If he really wanted to go where the money is, he would have attended law school.