LEGAL CENTS: Five ways to save with litigation management

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Glendale attorney Paul Junius is a professional defendant and penny-pincher.

When businesses are being sued, Junius, of Risk Retention Insurance Services Inc., steps in to manage litigation. He and his team serve as the external arm for in-house counsel, who are either too busy to handle litigation or don’t have the expertise. They also work with businesses that don’t have in-house counsel.

Litigation managers bring greater predictability and cost-containment, Junius said. They also work, he said, to protect a business’s reputation and keep future insurance expenses as reasonable as possible.

The practice of litigation management is growing, said Taylor Smith, of Revere Advisory in Chicago. Last year, Smith’s consultancy performed a national litigation management study commissioned by the Council on Litigation Management, an association that now has more than 15,000 members.

Among the study’s findings from polling senior executives at 47 organizations, he said, was the effectiveness of their litigation management had become a CEO-level issue with 67 percent of the respondents.

Participants were asked to quantify the financial return they reap for every $1 they spend on litigation management.

The median rate of return was $2.75, Smith said, representing an annualized return of 175 percent.

For his part, Junius said, the settlements he’s been involved in during the past 20-plus years are typically 70 percent less than the averages that carriers pay in any given case category.

Insurers’ interests are similar, he said, but aren’t always exactly aligned.

“To most insurers,” Junius said, “the only good claim file is a closed file.”

So, how do litigation managers do it? Smith and Taylor shared a few strategies:

• Identify expectations for your outside law firms via a “statement of purpose” concerning what litigation management means to your legal department. Then, enforce it via regular meetings with outside counsel, Smith said.
• Assess cases early, even when they’re still in the claims stage, Junius said, and take care of problems quickly when warranted. “We take control early on in a case,” he said. “You’d think it would happen all the time, but it doesn’t. A lot of people sit on things.”
• Budget, based on the assessment. Upward adjustments are approved before the money is spent, Junius said.
• Create direct relationships with litigation-support vendors so outside counsel doesn’t do it for you — and bill you for it. Smith said businesses are often better than law firms at negotiating court reporter services, e-discovery providers and other services. Junius said his firm offers a stable of experienced experts.
• Speed up the case’s pace. Junius said courts that have “rocket dockets,” such as the federal court in the Eastern District of Virginia, have proven that litigants spend less on their cases when everything’s compressed.

“Litigation can be uncertain,” Junius said. “But if you can prove to the other side that there’s no way they’re going to be able to meet their burden of proof, they’re not going to want to invest in it.”

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