A Risky Business
In her later years, my mother-in-law, Ann, thoroughly enjoyed gambling. On occasion, I would be enlisted by her daughters to chauffeur Ann to the casinos about an hour’s drive from her place. I actually treasured these times alone with Ann as we otherwise would always be surrounded by family. The casino trips provided the rare one on one opportunity for meaningful conversations between us.
I marveled at her gambling routine once at the casinos. Ann would locate the desired video poker machine at a bar, order a Manhattan to drink, and gamble no more than the $20 she brought plus the $20 I would secretly slide her. Between bets, Ann would demand the bartender to explain why the Syracuse ballgame was not on any of the television screens at the casino located in Mississippi. Inevitably, she could make the modest investment last hours much to her amusement.
I, on the other hand, followed a different routine of sorts. First, I would have to pull the twenty-something year old bartender to the side to explain how to properly make a Manhattan, and generously tip the bartender so that this new exotic drink, a Manhattan, would continue to flow to my mother-in-law. Once Ann and the mixologist were set, I would proceed to the blackjack or craps tables. After a few hours, I would scoop up my evening’s geriatric charge and drive back wondering how the night cost me $300 while my mother-in-law enjoyed hours of entertainment at almost no cost. I miss those trips with Ann.
Ann understood risk. She was willing to lose $20 of her money, but no more. She appreciated that 100% of her $20 might be lost and that, regardless of this fact, she would receive the enjoyment of an evening out on the town. She further understood the odds of winning at the casino remained in the favor of the house, but that, at times, her Irish luck would break in her direction.
The risk calculus Ann used for an evening of gambling is one we all follow. In taking risks, we want to best understand the uncertainties, and, if possible, control them. Take picking stocks as an example of risk tolerance. A company’s balance sheet can be carefully scrutinized. The customer base and anticipated sales for the company can be studied. The future for the industry in general, micro-economic and macro-economic issues can all be vetted. Armed with this knowledge, we can decide whether to “roll the dice” in purchasing a stock.
This type of analysis applies to many aspects of our lives. Walking across a busy street involves the risk of being struck by a motor vehicle. To be safe, we cross at controlled intersections only when the pedestrian icon illuminates and only after we observe that on-coming traffic has, indeed, stopped. With the variables controlled, we can safely proceed across the street.
We willingly accept risks where we fully appreciate the consequences (Ann losing her $20); where we understand the potential influences on the risks (study the economics of investing in stocks); or where we better control the risk factors (cross at the green, not in between). People are generally cautious and avoid unnecessary risk or at least seek to manage it.
In mediations or settlement conferences, I have witnessed the utter disregard of this inherently cautious approach by lawyers and litigants. At some point, the mediator or neutral will raise the specter of litigation risk as a consideration. Well prepared lawyers readily respond that case law supports their positions or that uncontroverted facts will carry the day for their cases. Some lawyers will be able to cite relevant jury verdicts for similar fact patterns as confirmation of assigning modest risk to proceeding toward a trial. These type of responses miss the mark. Those responses address known or knowable litigation risk factors. True and unquantifiable risk lies hidden in the unknown and unknowable factors.
Unlike picking a stock or even throwing dice at a craps table, the litigation process necessarily includes inherently unknowable risks and risk factors which cannot reasonably be anticipated in preparation. Here are but a few real life examples of the unknown, unknowable, or unanticipated factors from litigations and trials from my own career.
In the middle of a six week trial involving multiple plaintiffs and defendants, the judge takes the bench and casually announces that every Sunday he plays a round of golf with three attorneys for the plaintiffs. As the weekly golf game is simply a sporting event among friends, it can have no influence on the court, so says the judge (Note that the judge never stated whether the golfers discussed the pending trial during their golf outings). The judge wanted to place that statement on the record in the interest of complete disclosure, but he remained certain that no party had any issue with it. Thanks judge.
The Early Christmas Present
A multi-year litigation culminated in a case the court scheduled to commence immediately before Thanksgiving and be completed no later than December 21. Given the time allocated to each party, the jury would receive the case for deliberations on December 21. The judge repeatedly advised the jury that their service would be completed before Christmas. The jury began deliberations on December 20. On December 22, with no end to jury deliberations in sight based on questions from the jury, the judge announced that he made a mistake in his jury charge and would modify his jury instructions. Over objections, the judge added a new element of proof to the plaintiff’s claims. No party had addressed this element of proof in their case and the judge knew it. The jury listened carefully to the new requirement added to plaintiff’s case and returned a verdict for the defense twenty minutes later.
The judge created a nightmare for appeal, entered a judgment he knew could not withstand challenge on appeal, and wasted the resources of all parties putting on a multi-month trial. But, hey, everyone was home by Christmas as promised.
The Foul Mouthed Witness
It is not exclusively judges who throw you wild cards. Your own witnesses can cause the train wreck at trial. I represented a large Japanese camera manufacturer at trial. A Japanese witness whose testimony just completed was an engineer who discussed various features of cameras and lenses. At the conclusion of his testimony, our counsel table was littered with boxes and styrofoam pieces from the packaging. The judge denied my request for a five minute recess to allow us to repackage all the cameras and accessories before proceeding to my next witness, the American head of sales. Quite reasonably, the judge told the jurors to stand and stretch in the jury box while we put away all the equipment.
With our backs to the jury, I whispered to the American head of sales to appear helpful and assist in putting away the cameras and lenses as the jurors were watching us. The chief sales guy fumbled with a lense and styrofoam piece for a minute, became frustrated, tossed the pieces back on the table and said way too loudly: “Only the f***ing Japs can put these back together”. The judge and jurors stared at my next witness with mouths agape. I did my best to act like nothing happened. Game, set, match for the adversary.
Bonus risk factor from the camera litigation: When representing a Japanese company, try to avoid taking the case to trial on the 50th anniversary of Pearl Harbor.
Birds of a Feather
In a product liability case, we remained confident that the plaintiff could not establish a defect in the product or that the product caused the fire at issue. The plaintiff’s own experts had no answer to our proof of an alternative cause. The plaintiff himself was not sympathetic mostly because he was the alleged alternative cause of the fire.
In this particular court, a case for trial is not assigned out to a particular trial judge until the first day of trial. Plaintiff’s counsel in this action was, unfortunately, wheelchair bound due to a horrible motor vehicle accident. The case was assigned to the one judge in the district who was also wheelchair bound. The trial judge took the bench and immediately disclosed the four or five organizations and associations where he and plaintiff’s counsel closely work together. The judge then inquired if the defense has any problem with people with disabilities. We settled the case by lunchtime.
The unexpected can happen anywhere along the litigation spectrum, including as part of a mediation. A week before a scheduled mediation, unsolicited, I received a letter and photographs from a party’s wife. The letter asserted that in good conscience, the wife could not permit her husband to exaggerate the nature and extent of the injury to his ankle. The wife claimed that before doctor visits, her husband would hit his ankle against their bedpost to enhance bruising and swelling. She included photographs from a family trip to Disney World with her husband walking with the family and waiting in lines. These photographs ran counter to the photographs submitted to our side by the claimant which illustrated the claimant in a wheelchair and having to wear a boot while at Disney World.
Both husband and wife appeared at mediation with the husband’s attorney. We privately conveyed the wife’s disclosures to the claimant’s counsel. After a lengthy time to regroup, the claimant’s attorney asserted that the wife’s disclosures merely confirmed the true love story between the husband and wife. According to this lawyer, the family relationship was strained with the parties veering toward divorce due to the trauma of this accident. The wife sent us the information when the couple was at a low point. But now, one week later, they were back together and their love stronger than ever. The wife really did not mean everything she told us (I suppose she also did not mean to provide the damaging photographic evidence). Nice try. The case settled below nuisance value.
Unfortunately, I have numerous other, equally absurd examples of events from trials or litigation which no one could have reasonably predicted or foreseen. You cannot make up this stuff. Each example seems like a surreal scene from a movie, but each event happened to me. I am not unique and other litigators and trial attorneys can share their own impossible or unbelievable moments.
What remains equally unknowable is whether these events will represent a speed bump in a case or cause a twenty car pile up. Either way, they will happen. When a mediator discusses “litigation risk”, do not think of Ann and her $20 bill at a casino. Ann addressed the known and identifiable risks. Instead, think about how you would seek to explain any of these wacky examples to your client and why you did not anticipate it. Remember, settlement buys finality and precludes these events from materializing. Manage the risks rather than charge head first into them.