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Attorneys debate economists’ worth

Attorney Jason Abraham sits at his desk at Hupy & Abraham SC, Milwaukee, recently. Abraham is a proponent of hiring forensic economists, despite the cost, in cases with a potential for large payoff. (Staff photo by Kevin Harnack)

Attorney Jason Abraham sits at his desk at Hupy & Abraham SC, Milwaukee, recently. Abraham is a proponent of hiring forensic economists, despite the cost, in cases with a potential for large payoff. (Staff photo by Kevin Harnack)

The pressure is on forensic economists to prove their worth in a tight market.

While some attorneys, particularly for plaintiffs, say hiring a forensic economist to evaluate cases is worth charges of upwards of $300 an hour, others prefer to crunch the numbers on their own.

Paul Scoptur, a personal injury lawyer with Milwaukee-based Aiken & Scoptur SC, said in cases, for example, involving a factory worker who sustains a career-ending injury in a car accident caused by another person, simple math can determine the extent of the worker’s lost wages.

“It’s an easy enough computation, where you don’t need an economist to fool around with that,” he said.

But attorney Jason Abraham said there are cases in which costly outside expertise is unavoidable to try and convince jurors there is more than just an hourly wage at stake when determining damages.

“In a lot of cases, future loss of earnings is the biggest component of the claim,” said Abraham of Hupy & Abraham SC, Milwaukee. “If the damages are in the hundreds of thousands, it’s well worth it.”

In the event that an economist is needed for trial testimony, however, Scoptur said, there is risk that an abundance of facts and figures will cloud the judgment of jurors.

“You don’t want to confuse jurors and it’s a little complicated at times, which is why I prefer not using them when I don’t have to,” he said of forensic economists.

Which is why more attorneys are making sure clients get their money’s worth from forensic economists in a down economy, said Chicago-based economist Stan Smith. An intelligent but comprehensible presentation to a jury is key, he said.

“I do think more attorneys are saying, ‘Keep it simple, stupid,'” Smith said.

Abraham said he employs an economist in 50 cases each year, often successfully, to project everything from future earnings to fringe benefits in car accident cases and wrongful death suits.

In his experience, Abraham said, handling cases where someone is partially injured but can still work to some degree, it is best to not to leave things to chance with an attorney evaluation.

“What is the difference between what my guy can make now with restrictions after an injury?” he said. “There are huge fights between experts on those issues.”

Economist’s projections are far from infallible in court, however.

To a large extent, benefit and consumption estimates are subjective, especially the younger the person, although future earnings can be linked to W2 statements, tax returns and economic trends.

And there is always the potential a jury won’t buy the projections offered by an economist.

Scoptur recently had a case in which opposing counsel’s economist argued there was no inflation.

“As a practical matter, have you looked at gas prices?” he argued. “I think it’s subjective to a large degree and predictions are based on prior trends, but you could have Libya blow up tomorrow and what would that do to oil prices.”

Veteran economist David Ward acknowledged there is a degree of guesswork involved, but said he only takes cases that have basis.

“If someone comes to me and asks me to invent things, I’m not interested,” he said.

Ward, president of Sturgeon Bay-based NorthStar Economics Inc., said defense lawyers have less need to invest in an economist, as the burden of proof in a case lies with the plaintiff.

“The defense can sit back and decide whether they need anyone to counter,” he said.

That is a philosophy employed by Milwaukee personal injury lawyer Peter Stanford, he said, when working on the defense side.

If the plaintiff’s economist comes back with an agreeable number, Stanford said, he won’t waste his client’s money disputing it. But, it all depends on the accuracy of the projections being offered by the plaintiff, he said.

If elements such as inflation or if future union benefits are not included, Stanford said, “then the defense will be forced to hire an economist to get their version.”

For both sides in a case, a reasonable economic projection at the outset can lessen the chances for trial, Smith said.

In his 25 years of experience, he said, only one in 10 of the cases he works on go to trial, ultimately saving money for both parties.

“Half the time,” Smith said, “cases settle before deposition.”

Jack Zemlicka can be reached at jack.zemlicka@wislawjournal.com.

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