Company executives and their insurers will know they've signed on with such an attorney because, upon receipt of the complaint, the defense attorney will thank them profusely for the work and assure them there is nothing different from the thousands of past claims. Beware!
To defend against an asbestos claim, particularly in California, most lawyers and law firms follow a simple formula or template to provide a "cost-effective defense." Company executives and their insurers will know they've signed on with an attorney that uses the formula because, upon receipt of the complaint, the defense attorney will thank them profusely for the work and assure them there is nothing different from the thousands of past claims. Beware!
Here, revealed to the risk management and insurance industry for the first time, are the defense attorney's "essential steps to success" for companies defending against an asbestos personal injury claim. After outlining the defense formula, the fallacies of this "template" approach will be discussed.
First, the defense attorney will closely follow "the outline" for taking an asbestos deposition because it has been around for 20 years, and there are no new issues in asbestos litigation, right?
Because it is "too expensive" to conduct independent, pre-deposition investigation, the deposition is the best time for the attorney to find out the case facts, particularly those that will determine if your company has liability.
At the deposition, the defense attorney will repeatedly ask the plaintiff about your product--leaving no possible avenue of exposure unexplored (and making the plaintiffs' case). Coverage of details concerning other possible, unclaimed exposures is generally unimportant.
An attorney working from the formula will avoid any testimony that might tell the jury what the plaintiff did during the rest of his or her life to place matters in context and will instead hone in on confirming his memories of "product identification."
Why bother with the "extra" information when it is almost certain there is a connection between your company and the plaintiff because you are named as a defendant in his personal injury lawsuit.
Defense attorneys will commonly avoid excessive objections to leading, unfounded or argumentative questions posed by the plaintiff's attorney. After all, this is the deposition of a sick and dying individual who may be having trouble recalling and describing facts accurately.
Videotaping the entire deposition is also a waste of money because the company is not preparing the case for trial anyway (even though plaintiffs' counsel is).
If the company and/or its products are identified in the deposition, the next step is to evaluate the case for settlement. Everyone knows that every fiber can be fatal. If there is no identification, the lawyer will prepare a motion for summary judgment, ensuring this is scheduled as late as possible so expert discovery is nearly completed before the motion is heard.
Expert depositions are an important phase of any asbestos case, but according to the defense formula, the experts have been saying the same thing for years. As a result, it is not considered worthwhile to take these depositions, much less prepare extensively for the depositions or to attempt to develop new experts or new attacks on the opinions of existing experts.
In closing the matter on your behalf, the formula encourages defense lawyers to be sure to report fully on each case and thank you and your company for the opportunity to handle this difficult and challenging matter.
Successful settlements will result in a steady stream of cases for their firm. And in the event your company enters bankruptcy, this defense counselor will simply move on--there are plenty of defendants out there with insurance, and they will need representation even after your company joins the ranks of those protected from further participation in the litigation by 524(g) trusts.
THE FALLACIES OF FOLLOWING THE FORMULA
This style of litigation, which emphasizes prompt reporting and cost-cutting, no longer fits in a world in which more than 80 companies have been driven into bankruptcy in part by their asbestos liabilities. Although many cases are similar, the litigation landscape and liability picture has changed dramatically in the recent past.
Most of the companies that were major players in manufacturing and distributing asbestos are gone, and chances are good that currently targeted companies were not major, or even minor, players in the manufacturing of asbestos-containing products.
The Asbestos Plaintiffs' Bar is organized on a national scale, selling cases, sharing experts, briefs and legal strategies, and seeking out the jurisdictions with the most favorable judicial rulings and trial setting schedules. Following their formula, many plaintiffs in other mass or toxic torts are similarly organized. Sticking with the purely defensive and minimalist strategies outlined in the "old school" formula has the following industrywide impacts:
- Emphasis of forms, deadlines and cost-cutting over quality legal analysis will generally result in higher settlements and ever-increasing case loads for asbestos or other toxic-tort defendants. The established "defense formula" plays into the hands of prepared plaintiffs' attorneys. In fact, they have come to rely on it.
- Experienced plaintiffs' lawyers can pursue cases against companies with little financial risk because they don't have to spend any more money to add your company "to the list" of those they are suing.
- Settling cases for less than the cost of a companies' defense, even if the claim otherwise has no merit, allows plaintiffs and their counsel to profit from suing in otherwise defensible cases. This ensures an ever-increasing case load for defense attorneys and no real cost savings for you--their clients.
- Doing as little as possible in every case ensures that the defense lawyer is not protected when some plaintiff with a truly meritorious case sues your company.
CUSTOMIZING YOUR DEFENSE
Even in the face of these now "standard" defense practices, cases can be won at trial. A review of 37 jury verdicts reported in Harris Martin for California alone from 2001 through Sept. 2007 reveals the following:
- 19 of 37 cases resulted in a defense verdict or hung jury.
- Median value of plaintiffs' verdict: $4.4 million.
- Mean value of plaintiffs' verdict: $6.4 million.
(All estimates exclude punitive damages awards.)
Depending on the defending company's position, doing more than "the usual" may yield present and future benefits, despite the superficial appearance that such expenses are not justified compared with the "historical settlement value" of similar cases.
Most, if not all, witnesses with direct knowledge of the acts that supported plaintiffs' punitive damages claims against Johns Manville, Raybestos-Manhattan and others are dead. The insulation manufacturers, almost without exception, are bankrupt, as are the major distributors and installers of asbestos thermal insulation.
Working with your counsel to develop information and evidence to prove the liability of these absent responsible parties at trial is one way to tell the "untold story" to a jury.
Defendant companies and counsel wishing to do more than follow "the formula" may focus on four general areas:
1. Early evaluation of case-specific facts to look for opportunities to prepare new defenses or develop new facts to support trial defenses.
2. Development of experts and evidence to support legitimate defenses and prove liability against absent culpable parties (to the extent permitted by the jurisdiction and the facts of the case).
3. Making lawsuits against companies unprofitable for plaintiffs' counsel.
4. Development of facts, case law and arguments that will allow you to argue for changes to existing law.
Having strong, trial-ready defenses and the trial attorneys to present them, diminishing the easy profits for plaintiffs' counsel, and a clear forward-looking strategy may be more expensive in the short term, but will result in improved settlement values and declining case filings against the company and industry in the long term.
Cases must be considered on their individual merits and as part of the local, regional and national asbestos landscape. If these customized measures are "too costly," then perhaps your company should start looking for bankruptcy counsel.
RICHARD AMES is an attorney and partner with San Francisco's Carroll Burdick & McDonough, where he co-chairs the firm's toxic-tort practice.
(This piece originally appeared as a Web extra for the Liability Special Report in our Jan. 2008 issue.)
January 1, 2008
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