The attorney's fee: compensation for the work
The contingency fee is the attorney's own compensation for handling the case — calculated as a percentage of the settlement or award. It's earnings, not a reimbursement, and it's what the attorney keeps for taking on the risk and the work of the case.
Case costs: real expenses the case required
Case costs are something entirely different: actual out-of-pocket expenses the case genuinely needed. This typically includes expert witness fees, court filing fees, the cost of obtaining medical records, deposition transcripts, and similar litigation expenses. These are reimbursed, not earned.
Minnesota's rule explicitly allows the attorney to advance these costs
Rule 1.8(e) of the Minnesota Rules of Professional Conduct specifically permits a lawyer to advance court costs and litigation expenses on the client's behalf, with repayment contingent on the case's outcome in certain circumstances. This is what makes the common "you don't pay anything out of pocket" arrangement possible — it's built into the ethics rules themselves, not just firm policy.
Reasonableness applies to both
Rule 1.5(a)'s reasonableness standard isn't limited to the fee itself — it explicitly covers "an unreasonable amount for expenses" too. That means the costs charged against a settlement are subject to the same basic fairness check as the percentage fee, even though they're calculated on an entirely different basis.
Who fronts the money while the case is pending
Commonly, the attorney's office advances case costs as the litigation proceeds, with reimbursement coming out of the eventual settlement or award. The specific arrangement, including what happens to those advanced costs if the case doesn't result in any recovery, depends entirely on the individual fee agreement.