Preparing for the Big One

You get the call: There has been a catastrophic, mass-casualty event with numerous injuries, fatalities, and widespread property destruction. The emergency response by the insured over the ensuing 24 hours is going to be crucial. What do you do? In our August CLM Magazine article “Defending Billion-Dollar Claims: Nine Best Practices for 10-figure Losses,” we reviewed key steps to help you manage, prepare to litigate, and resolve billion-dollar claims from the outset. This article will take a deeper dive into step one and elaborate further on the actions that can be taken in the immediate aftermath.

Gather Your Legal Team

The next time you get the call about handling a catastrophic event, you should assemble your team of “go-to” professionals and dispatch them to the incident scene fully prepared for an intense 24 hours.

Boots on the ground is a must and, in an ideal world, your legal team will be predetermined. This should include an emergency response team of legal counsel with a track record of success and experience in crisis management and handling high-profile, high-exposure catastrophic claims; who can drop everything and head to the scene when needed. Given the fast-breaking and multidimensional aspects of such a situation—against the backdrop of news media coverage, investigative activities by state and local authorities, and public clamoring for answers—there is no substitute for experience.

If your lead counsel is not familiar with the jurisdiction, local counsel needs to be identified, contacted, and, ideally, meet with the lead attorneys at the scene. A carrier representative should advise the insured immediately that counsel is on the way, and the insured should help coordinate the effort.

If criminal charges may be implicated, local civil counsel should bring along predetermined criminal counsel who knows the significance of working together on a catastrophic event of this scale. For example, in the case of a catastrophic transportation event, pilots, train engineers, boat captains, or truck drivers may be taken into custody immediately after the event and medically tested and examined by authorities. You will want to have an experienced criminal attorney ready to counsel them because their actions may be imputed to the insured through agency, and they must be represented—hopefully before any statements are given or interviews by the media are permitted. Understandably, they also will be anxious after the event and will need to know they have counsel and support.

The retention of attorneys at this early juncture has the added benefit of establishing the attorney-client relationship, which cloaks the investigation through the attorney-client and work-product privilege. Lead counsel will be the central point of contact for the defense. Gathering information as early as possible informs the development of a consistent and focused defense strategy.

Mobilizing Supporting Cast Members

Integral to the legal team, and ready to go to the scene at a moment’s notice, should be an investigator and accident reconstruction consultant or other liability expert, depending on the situation. Consultants’ expertise will be critical to educating and advising the defense team on possible causes for the incident as well as the next steps to be undertaken in the investigation.

While not in transit to the scene, the rest of your team needs to be mobilized. They should include support such as associates and legal assistants who have outstanding research abilities and organizational skills. They should be just one phone call away, and they should be prepared to work around the clock to address issues as they arise.

While counsel is in transit, associates should be combing through the myriad of news articles and social media surrounding the event, including comments by readers or viewers, and feeding to counsel all intelligence on what occurred, including, but not limited to, information surrounding suspected liability, key witnesses, and preliminary numbers of those injured or deceased.

Legal assistants should be compiling this information—including key facts, players, and damages information—and entering it with source notes into charts to be revised and updated as the investigation unfolds. Associates should be issue-spotting these articles and social media posts to help guide counsel’s investigation and evidence preservation efforts on the ground. This valuable source of information is tantamount to free discovery that would otherwise take litigation teams months or years to develop. Since it is contemporaneous, it may contain admissions that can be used for impeachment later.

Capturing the Moment in Time

At the scene, counsel should get the lay of the land, including contact information for the authorities involved, and liaise closely with the insured representatives. Before memories fade, the legal team should:

•    Gather facts from key insured employees about what occurred.

•    Identify relevant witnesses on the scene who may have more information and can be interviewed later.

•    Locate key evidence to be preserved in the vicinity and at the accident scene.

•    Identify key players of other involved parties or lead investigators with various government entities on the local, state, and/or federal level, such as the FBI or National Transportation Safety Board.

Remind the insured that all communications going forward are to go through lead counsel. The legal team must also ensure compliance with all post-incident testing procedures or government-imposed regulations in a timely manner.

Evidence preservation is a paramount concern at the scene. Remember that, in the middle of rapidly unfolding events, you may not capture the relevance of everything on the scene. Therefore, it is important that your experts are documenting the scene thoroughly via photographs and video from all angles. Best practice is to ensure that the native files are kept from all multimedia so that relevant metadata information is tied to them. Communicate with the insured and authorities to get an understanding of the relevant area. Canvass the area for surveillance videos from nearby businesses, traffic lights, dash cams, body cams of investigators, or witnesses on the scene who may be uploading those videos or photos in real time to their social media accounts.

Make sure that crucial evidence in the insured’s possession is preserved with a solid chain of custody and that the evidence collected stays in its post-incident state for future examination and inspection by experts, investigators, and potential litigants. The insured also must place a companywide litigation hold on all communications leading up to the event to prevent deletions or alterations (be over-inclusive in order to avoid any future spoliation motions). Lastly, take note of critical evidence in the possession of others so the team can issue evidence preservation letters immediately.

Communicate and Strategize

After the preliminary investigation on the scene, counsel should meet with their experts and share information to get a complete picture. Discuss the facts, determine what is known and unknown, ensure that your investigation and evidence preservation efforts are on track, and strategize about handling foreseeable issues. Bring in other relevant expert specialists you may need for consultation on issues resulting from liability, causation, and damages. Lock in the best experts before the other side engages them. Discuss the applicable law in the jurisdiction, whether choice-of-law issues may arise down the line, and how these may impact or broaden the investigation.

All insurers should be contacted and notified at the appropriate juncture, and an initial “all-hands” teleconference should take place with the legal defense team and key representatives from the insured to clearly communicate the information gathered to date. It is essential to form a preliminary working strategy for handling the crisis to ensure everyone is on the same page regarding who is doing what and next steps, both immediately and for the foreseeable future. Being able to assemble, mobilize, preserve, and strategize in the first 24 hours after a catastrophic event will make a big difference moving forward.