Understanding UTBMS Codes

The Uniform Task-Based Management System (UTBMS) is a standardized coding system used to categorize legal work. UTBMS codes go hand in hand with the electronic LEDES invoice file format.

UTBMS codes were developed in the 1990s in response to a growing need for a more structured and uniform approach to tracking legal services. The initiative to introduce these codes was headed by the American Bar Association (ABA), the Association of Corporate Counsel, and a group of major corporate law departments and law firms.

What are UTBMS Code Categories?

UTBMS codes are divided into four main categories:

• Phase codes: Categorize legal work into stages, such as pre-trial, discovery, and trial for litigation matters.
• Task codes: Categorize legal work into specific tasks, such as pleadings, motions and document production.
• Activity codes: Categorize the action performed to carry out the legal task, such as researching, drafting, and communicating with other parties.
• Expense codes: Categorize legal expenses, such as travel costs, photocopying fees, and court fees.

Why are UTBMS Codes Important?

The use of UTBMS codes has several benefits for in-house teams. First and foremost, they provide a standardized way to track legal work and expenses, making it easier to understand and manage legal costs and outside counsel spend.

This can be particularly useful in large or complex cases where costs are high and in-house teams want to monitor law firm resources for each phase of work or specific legal tasks. It can also help compare similar matters in the past to forecast budgets for new matters.

Some e-billing systems require law firms to submit UTBMS codes to classify legal work. In contrast, newer electronic billing systems can automatically apply these codes, reducing manual work for outside counsel law firms while creating a completely consistent and accurate code set.

What are LEDES Files?

Legal Electronic Data Exchange Standard (LEDES) files are a standardized format for legal invoices that makes it easier for law firms to send, and for in-house teams to receive, bills electronically. They were created by the LEDES oversight committee (LOC) in 1995.

LEDES files use UTBMS codes to categorize legal tasks in order to provide a detailed overview of different phases of work on a matter and their associated costs.

What are ABA Codes?

ABA codes are the subset of UTBMS codes that were created by the ABA Working Group on Task-Based Billing Codes. The most widely used ABA UTBMS codes are the litigation code set, created in 1997. The terms ABA codes and UTBMS codes are often used interchangeably, especially in the case of the litigation code set.

Why are ABA Codes Important?

ABA codes are important for the same reasons that UTBMS codes are important: they provide a standardized way to classify and track legal work, which in turn streamlines the process of managing legal costs.

Additional Terms Related to UTBMS Codes

• Legal billing codes: A system of codes used to categorize and track legal work and expenses. Typically legal billing codes are pulled from UTBMS codes, but in some instances (e.g., when no appropriate code set covers the work being performed), companies may decide to create and track custom legal billing codes.
• Litigation code set: The UTBMS code set used to categorize legal work related to litigation. The ABA litigation code set is the most widely used. The DRI code set, released in 2007, is a revision of the original ABA litigation code set. It was designed for use by insurers and includes more granular task codes than the original code set. The EW-UTBMS J-Code-set is another alternative litigation code set designed for use in England and Wales.
• LEDES/UTBMS expense codes: A UTBMS code set used to categorize legal expenses, typically used in LEDES invoices.
• Legal task codes: Codes that are used to categorize specific legal tasks, such as pleadings, motions, and document production for litigation matters.

Shortcomings of UTBMS and LEDES

Legal spend management is a complex task that requires accurate data to make informed decisions.

The Uniform Task-Based Management System (UTBMS) and Legal Electronic Data Exchange Standard (LEDES) are two systems that aim to standardize legal spend data, but they have their drawbacks.

While UTBMS codes define the different phases of work in common matter types, including litigation, mergers and acquisitions, and intellectual property, assigning these codes accurately is difficult due to the subjective interpretation of lawyers.

Furthermore, LEDES invoices do not require UTBMS codes, leading to data gaps. UTBMS coding also creates issues for in-house legal professionals as it is prone to human error.

However, categorizing legal spend is essential to confidently manage data and control costs. Therefore, legal billing software like Brightflag, which leverages machine learning algorithms to analyze legal spend data accurately, can help organizations make better-informed decisions with accurate invoice reviews.

Book a demo today to learn more about how Brightflag can transform your legal department’s invoice review process.