Mark Gediman at 3 Geeks and a Law Blog has an interesting post about law firm cost recovery for online database charges.
I find myself constantly explaining/defending/justifying our cost recovery policy. Maybe I've been sampling the Kool-aid along the way, but I've come to realize that most firms that charge back for online services are actually saving their clients money.
Mark offers some examples of the cost savings that can be achieved using online databases v print materials, including this one:
Charging a fee for pulling a case online is less than the cost of pulling it off the shelf
Let's say a firm charges clients $10 per case. It takes about a minute to pull and print the case. With a billing rate of $300/hr, the total cost to pull that case would be $15 ($10 for the case, $5 for the attorney's time).
If the case is pulled from the shelf, let's figure the following time is spent: 5 minutes to walk to the books, 2 minutes to pull the right volume, 5 more to copy the case and 5 more to walk back to the office for a grand total of 17 minutes. The cost is $85. And this doesn't count the cost of the space required to house the cases or the copying charges.
The cost to pull the case online is only 17% the cost of pulling it in print. I realize that not everyone does these activities in exactly the same way. However, what is clear is that the client actually saved money in the process.
But he does note that there are some caveats to the online saving rule, particularly when using a treatise, "usually a practice guide, that the end user knows intimately." He notes that "it is actually better to keep these types of treatises in print."