The thought of having to deal with a lawsuit can be stressful, to say the least. But what if you could hire a professional to handle all of the details and make the process as smooth as possible? They’re called 'litigation managers,' and John Beringer gives you an introduction to what they do in this document.
If your business were hit with a lawsuit, you’d hire a defense attorney. Let’s say your counsel’s analysis shows that the plaintiff’s evaluation of the case is unreasonable.
This means that 'discovery' will be needed to enlighten the plaintiff’s counsel about their misjudgment in filing the suit. A succession of pleadings, motions, and/or discovery requests will provide you with less and less new information at a greater and greater cost. What’s more, your organization will have to deal with discovery requests from the plaintiff, increasing your costs and exposure.
At a pre-trial settlement conference, your counsel tells you the case has an exposure greater than anticipated and recommends settling the matter. As negotiations progress, his estimate of the case’s value keeps increasing.
After all, if your attorney offers a realistic monetary settlement, this reinforces the plaintiff’s belief in the value of the case. Your defense counsel’s responsibility is to convince the plaintiff that they won’t get the settlement they expected. The higher your defense costs, the greater the chances that you’ll see any settlement as a capitulation.
This process is necessary for two reasons: the attorney’s role is to move the case through litigation — and some cases do need a jury trial.
Now let’s look at this litigation from the plaintiff’s point of view.
First: The plaintiff’s counsel has more information than the defense about potential damages, but probably knows less about negligence/liability. Counsel won’t take the case unless they can make an acceptable profit on it.
Second: It’s common knowledge that every case has two sides and that clients don’t always disclose facts adverse to their interests. This dynamic will drive the plaintiff’s counsel to adjust their analysis when presented with additional information, particularly in the early stages of the suit. Although they can’t reject the case at this point, they can recommend settling the matter.
Third: The attorney’s level of profit is determined by the amount and cost of the resources expended to attain their goal. In other words, the longer the litigation, the higher the expenses — and the lower their potential profit. The fact that few plaintiffs have the income to sustain the costs of litigation also gives them an incentive to settle as soon as possible.
On the other hand, once the plaintiff’s counsel has taken the case, they’re in for the duration. Courts, and the bar, don’t look favorably on attorneys who fail to meet their professional obligations. What’s more, as opposition to the plaintiff’s position increases, their level of commitment to succeed increases.
However, there’s a cost-effective alternative to these dynamics that doesn’t involve an additional attorney — using a professional litigation manager who can:
- Evaluate the cost of the litigation process;
- Identify your exposure to the costs of defense, indemnity cost and public sanctions; and
- Use the value of money to remove this exposure, including using any potential credits to offset the value of the case.
If you’d like more information on this type of service, feel free to contact me.