3 common litigation Q&As

Listen to the MH Business Exchange podcast with Alan Burger and Mike Witzke, and read the accompanying blog below:

 

Alan Burger, an experienced litigator and Member in McDonald Hopkins’ West Palm Beach office, offers insight gained over the course of a 30-year legal career on three common questions clients ask when facing litigation.

How much will this cost?  It’s important to understand that virtually all suits employ the same process and procedures. So, that variable is controlled and predicable. Additionally, given the size of a firm’s litigation practice, the attorney can typically analyze hours spent in other similar cases to try and predict the fees associated with a new lawsuit or, on a going forward basis in an ongoing suit.

Even with those predictors, other factors can cause dramatic differences with respect to the anticipated cost:

  • Opposing party(ies) - A cost-conscious adversary often leads to a predicable cost on the other side of the equation. On the other hand, an unsophisticated adversary, an adversary with deep pockets, or an adversary that is not paying the bill (e.g., has the lawyer retained on a contingent basis or a very demanding adverse party) can and will drive up the cost of litigation.
  • Opposing lawyer(s) - Based on experience certain lawyers and law firms on the other side of a dispute will result in a higher cost to the client. Sometimes the economic cost is two or three times what it might otherwise be. There are varying reasons for adversary [mis]conduct. Sometimes opposing parties (along with their client) employ scorched earth litigation as a mechanism to force settlement; sometimes it’s a method of lawyering that garners reputational results because the legal community knows a particular lawyer or firm will cost the adverse client more; and, sometimes there are simply sinister reasons for the conduct.
  • The court - Not the judge, but the court system itself. Some courts are simply more expensive for litigants. For instance, the procedural requirements of federal court mandate additional cost over the same type of suit in state court. Additionally, federal court costs may be time compressed because a suit which takes three or four years in state court will often be required to be trial ready in one year in federal court.
  • The judge - Judges have their own nuisances. Some are very efficient, some not as efficient. The same case could cost 50 to 75 percent more depending on the assigned judge.

What do clients not consider?

  • Any lawsuit has a taxing non-economic component. Every minute you spend dealing with your suit is one less minute you have to deal with your business.
  • Lawsuits are emotionally taxing. Lawsuits are adversarial. They are designed to force participants to take a hard look at behaviors and potential consequences for those behaviors. Ultimately, those behaviors will be judged by third parties – either a judge or a jury. Sleepless nights are expected.
  • The only outcome you can control is the agreed upon or settled result. Very fair hearings or trials can have totally unexpected outcomes. Sometimes, decision makers come to a decision for an unknown reason. Decision makers can fashion remedies that nobody foresees.
  • There may be tax efficient ways to structure settlements which should be considered. Sometimes it makes much more sense to look at tax efficient settlement mechanisms. It’s worth noting that sometimes the framing of the lawsuit can impact the tax efficiencies of the resolution itself.
  • Objectivity is required. You must try and view behaviors objectively.

What are my chances? There is really no way to tell, with certainty, the outcome of a case. While a good attorney can provide the anticipated cost and predicted outcome based on facts and the factors discussed above, there is really no way to tell, with certainty, the outcome of a case. The chances of predicting an outcome may, and likely will, change over time -  the totality of the circumstances over time impact any notion of predicting a percentage of a “chance” with respect to any proceeding.

 

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