The Disruptive Lawyer Series: The Bizarro World of Litigation Management

Preface

Much like the iPhone was dubbed “disruptive technology” because it changed the thinking of an industry, the Disruptive Lawyer embodies the right skills to disrupt – in a positive way – your expectations of legal results. And as we are in the “evidence” business, rather than telling you we are Disruptive Lawyers, we’re sharing stories of real cases that demonstrate Disruptive Lawyer results. Here’s the next. We welcome your thoughts at disruptivelawyer@cmlawfirm.com. Read more Disruptive Lawyer stories here.

The Disruptive Lawyer’s Bizarro World of Litigation Management

The Disruptive Lawyer had recently hired a new associate from a very reputable firm. At his former firm, as in most traditional law firms, the associate had been told to bill, bill, bill. In fact, his success was judged not on saving fees or quickly resolving cases, but on the number of hours he billed. So, it was no surprise when the associate came to visit the Disruptive Lawyer’s office one sunny morning, barely able to contain his enthusiasm. He blurted, “You know that employment case we got where there are 10 employees making a claim for race discrimination against our client? Well, the plaintiff countered our $15,000 offer with a demand of $600,000 and rejected mediation. I reported this to the client who, given the crazy demand, gave the word to ‘start litigating!’ I’m psyched! There will be 30 depositions and seven or eight motions for summary judgment to file. This case will make my billable year. Maybe I’ll even get a bonus, like at my old firm!”

The Disruptive Lawyer was well aware of this case. The firm had just submitted its 45-day Resolution Strategy report indicating the client should win eight cases on MSJ, but two would go to trial with a 55-60% likelihood of winning what amounted to a swearing contest. Seeing the look on the Disruptive Lawyer’s face, the associate immediately sensed that the Disruptive Lawyer did not share the same enthusiasm for the assumed billing bonanza (and/or perhaps the proposed bonus).

The Disruptive Lawyer replied to the associate, “You know that the client would settle all these cases for a reasonable number if the plaintiffs’ lawyer got real. Do you think the client really ‘wins’ if it pays us $200,000 to litigate these cases over the next two years and still puts its fate in the hands of a jury?” The associate responded, “The plaintiffs’ lawyer won’t get real, so we have no choice… right?” The Disruptive Lawyer did not agree. She explained, “While the plaintiffs’ demand is certainly crazy, it is our job to convince the plaintiffs’ lawyer to be reasonable. We do not measure ourselves by the fees we bill, but by how much in fees and indemnity we save. You’ve got 24 hours to tell me our strategy to SAVE fees, and not BILL fees.”

The associate headed back to his office, shell-shocked thinking to himself, “Huh? I make money for the law firm by saving fees? I think I just got a job in Bizarro World.”

The next day, the associate met with the Disruptive Lawyer to set out his plan, which began with a trip to the plaintiffs’ counsel’s office to discuss the case and lack of support for the $600,000 demand. (Ironically, in the pursuit of saving attorney’s fees, only one of the two lawyers could bill to attend this meeting and that lawyer could only bill 50% travel time on the four-hour round trip, per the client’s Litigation Management Guidelines.) Once they were in plaintiffs’ counsel’s office, the Disruptive Lawyer quickly realized that the plaintiffs’ lawyer may simply be young and inexperienced, not necessarily crazy. The Disruptive Lawyer began the conversation stating, “Six hundred thousand dollars for an employment case would be a record settlement for that type of claim in Georgia. So, arm me with the information to explain to our client why this demand is reasonable.” The plaintiffs’ counsel essentially put up a smoke and mirrors case, and by the end of the one-hour meeting, she conceded that most of the damages were for lost income based on each employee being out of work for almost a year, and attorney’s fees. While the plaintiffs refused to go to mediation or drop more than another $20,000, this meeting opened a dialogue and pinned the plaintiffs to a damages calculation.

The Disruptive Lawyer reported to the client that the plaintiffs’ counsel had dropped to about $580,000. In turn, the client indicated that with the plaintiffs in that realm, “You have the authority to litigate.” The Disruptive Lawyer responded, “Before you start writing me big checks to fight, let’s be patient for another couple of weeks. I’m slightly optimistic that if we blow holes in the damages calculation, we may see more significant movement.”

The Disruptive Lawyer and the associate gathered information and evidence to “educate” the plaintiffs’ counsel that the damages calculation was excessive, including:

• Department of Labor data that employee turnover in the fast food industry is very high.
• Help wanted ads in the local newspaper, showing that lost income would be capped at two months, given the plaintiffs could find comparable work in the area.

The Disruptive Lawyer also delivered the information/evidence with a detailed letter to the plaintiffs’ lawyer (and to be shared with the plaintiffs) explaining why the plaintiffs’ cases were weak, exposing the reality of a ZERO recovery, and making an offer directly correlated to a severance of two months out of work. The letter also invited plaintiffs to mediation, for the third time.

It appeared the letter made an impact, as the dialogue between the parties picked up. Finally, after about 10 more conversations and more picking apart of the cases by the Disruptive Lawyer, the plaintiffs’ counsel agreed to mediate.

And, at the mediation, the cases all settled. The total cost of INDEMNITY was under $50,000 – a fair valuation for the 10 cases – with the two cases with the most exposure getting most of the money. More importantly, the cost of defense was about $22,000 – a savings of more than $175,000 in legal fees (not to mention the client’s capital costs of supporting the litigation).

And, if you’re wondering – yes, the associate did get his bonus. How? He got more work because the client started using him more often, and also recommended him to other clients as a “lawyer who gets it.” As he reflected, the associate realized he had been practicing in Bizarro World… but then moved to the Disruptive Lawyer’s law firm.

Metrics
Cost of Defense Saved: $175,000
Indemnity Saved: 0 to $100,000

ALL LAWYERS ARE NOT CREATED EQUAL
DISRUPTIVE LAWYERS MEASURE SUCCESS ON FEES SAVED,
NOT FEES BILLED