Reaching the Decision Point in Litigation

Summertime always brings back memories of family car trips. Inevitably, someone asked in a whiney tone “Are we there yet?” As I got older and gained some perspective on the distance of our various trips, I learned not to constantly pepper my parents with this expression of impatience.

A lawsuit can be very similar, and a lawyer and claims professional both have to know when to ask that question. In other words, they might say, “Are we now at a place where we can have a meaningful discussion about resolution? Is now the time to resolve the case?”

“Time to decision point” is a key metric to track. In managing litigation, you need to ask in each case, “How many days does it take to reach the point in litigation where a case can legitimately be resolved?”

Of course, a case can be resolved at any time. But just like an impatient child asking, “Are we there yet?” as you pull out of the driveway, trying to resolve a claim as soon as possible rarely will yield the best settlement for the defense. Defense counsel and the client need to position the case such that it puts maximum pressure on the plaintiff to be realistic about their chances at trial.

Two Main Errors

There are two errors that can be made if a decision point is not identified. One error is to begin efforts to resolve the claim before all the necessary information has been obtained. You may miss out on key evidence that can favorably affect your chances on liability or something that would reduce the plaintiff’s damage claims.

However, another error is to fail to accelerate the decision point. The longer a case drags on, the more expensive it can be. Many plaintiff’s lawyers will let a case drag out hoping that factors internal to the client will prompt a settlement offer. They also may put the case on the back burner because they have other more pressing matters. Whatever the reason, it is often the case that plaintiff’s lawyers will not move the case along until they are made to do something by opposing counsel or the court. Frequently, a case that could be worked up and resolved in 90 to 120 days will sit around for a year or more. Defense counsel should be active in preventing this by how they plan to pursue the litigation. When counsel is aggressive and goes on the offensive in discovery, the decision point comes soon and the life of the file becomes shorter.

Identifying the Decision Point

It is rare that I receive an assignment that can be settled prior to filing an answer and conducting at least minimal discovery. Although plaintiffs often will file simply to preserve the statute, some work usually needs to be done to push the case toward the decision point. It may be as simple as written discovery, or it may involve a trial date or expensive expert discovery. Whatever it is, the first step is to identify in the litigation plan the potential decision point (or points). What are some ways to do this?

Early Call to Plaintiff’s Counsel. Plaintiff’s lawyers are running a business and want to maximize their investment in the case. If they sense an opportunity for resolution in an early phone call, they may hint at a road map for reaching the decision point. Some would argue that an early call may send the wrong signal (e.g., that you are desperate to resolve the case) and could actually cause the plaintiff to be less flexible in early negotiations. The call does not have to be about settlement. A simple introduction to opposing counsel can yield fruitful information about when they are willing to negotiate.

Pre-Suit Negotiations. The course of negotiations before litigation often will yield clues as to where a decision point lies. Specifically, knowing why pre-suit negotiations failed will help you shape your plan. Was it a factual issue? Is there disagreement over unclear case law? Have a candid discussion with the client about the issues raised in any pre-suit negotiations and raise them again with plaintiff’s counsel.

Prior Relationship of Parties. In the commercial context, the business relationships of the parties will dictate the timing of resolution. Identifying a decision point may require a discussion with key individuals in the business who may not have direct ties to the litigation.

Liability and Damage Questions. Generally, the less discovery that is needed, the earlier the decision point will come. But every case has unanswered questions. It may be that all you need is a key deposition of a witness (a doctor, employer, or eyewitness) to answer a key question. You may identify your decision point by knowing when you can answer a specific question about liability or damages. In cases with potential permanent injury, the decision point may be delayed by the trajectory of the plaintiff’s recovery. In these cases, it actually may be favorable to delay the decision point.

How to Accelerate

Once the decision point is identified, defense lawyers can serve their clients well by employing tactics to accelerate the decision point. Failing to accelerate the decision point often means that the case sits idle. When that happens, cases get more expensive. Unnecessary tasks become necessary just to comply with (or to extend) court-imposed deadlines. So what steps can be taken to accelerate the decision point?

Hold to Discovery Deadlines. This applies to both discovery owed to you by opposing parties and discovery served on your client. Although there can be legitimate reasons for brief extensions, basic discovery (and initial disclosures in federal court) should be completed promptly. In fact, there is no reason your client can’t respond early. Outpacing the opposing party in discovery often can help move the case along, and it sets the precedent that you expect things to be done on time.

Request a Trial Date and Scheduling Order. A defense attorney by himself has no power to move the case along without a scheduling order. The Rules of Civil Procedure have time deadlines for written discovery, but the ultimate power comes from the court’s scheduling order. In addition, a trial date forces all parties to look at their calendars and decide what will get done and when. Setting the expectation early that you intend to try the case and will not agree to a continuance will accelerate the decision point.

Early Witness Interviews. Don’t wait for a deposition to get a key piece of information from a witness. This is particularly true in liability disputes. Interview the witness as soon as possible. If the testimony is favorable, you may want to set up an early deposition to solidify the evidence from the plaintiff. If it is unfavorable, you may need to engage in negotiations before depositions.

Agree on the Decision Point with Plaintiff’s Counsel. In some instances, it is beneficial to have a conversation with plaintiff’s counsel about what should be the actual decision point. If you have a relationship that allows it, ask the following: “It looks like we have some work to do on this case. What do you need from me to provide a realistic demand?” Get a laundry list of things from plaintiff’s counsel and work diligently to accomplish them. Ask for the same in return. Then see if they will agree to discuss resolution once everyone has gotten what they want—and not before.

In litigation, the question “Are we there yet?” is not always the right one to ask. However, answering the questions “Where are we going?” and “What is the quickest route to take?” is to everyone’s benefit. Lawyers who can do this serve their clients well.