Trial lawyer Michael Neff and his team have won over $100 million in jury verdicts and have been winning eight- and seven-figure outcomes in premises cases for years. In Advanced Premises Liability Cases, Neff shares three rules he follows for resolving cases before trial, and offers insights into how they can help you do the same:
Rule 1: No Demand Letters
We usually do not send significant demand letters on a premises liability case. The primary reason is that I don’t want to guide the defense on my theory of the case before I take all of the depositions.
Exception
However, an easy exception to the rule exists if the plaintiff has already been through a summary judgment process. There are few secrets left after preparing a significant response to summary judgment. At that point in time, a demand letter might be helpful to educate a mediator and an adjuster on exactly what you want them to know. Also, I acknowledge that COVID-19 [put] pressure on plaintiff’s law firms. The overhead continues, and cases aren’t moving through the courts. It is a challenge. However, if you are sending a demand, consider what you might hold back in the event the case (likely) needs to be litigated.
Rule 2: Insurers Respond Differently to Big and Small Cases
In my experience, insurance companies and large corporations respond to big premises cases (over $1 million) differently than smaller (five- and low six-figure) premises cases.
Trends in Big Cases
The trend in big cases is scorched-earth discovery from the defense, followed by a lengthy trial, and then an automatic appeal. Thus, these cases can take five or more years to resolve. Finding a hook to resolve these cases frequently requires a good mediator, strong discovery orders (sometimes involving sanctions), prejudicial or embarrassing facts, and perhaps a stronger willingness to compromise off the best value of the case. Accept this reality when you first take the case, and you’ll be able to progress with your eyes open.
In car wreck cases, I find that it’s much easier for the plaintiff to ask to mediate. In premises cases, you can do that, but many times it seems the defense will only consider it after summary judgment is ruled on. They want to take their shot at getting out of the case. And in spite of all of the work, time, and money it costs a plaintiff’s lawyer to get past summary judgment, it’s not that great of an investment for a huge insurance company.
Additionally, my presumption is that the defense lawyers generally view a larger premises case as a huge billing opportunity. They aren’t in a hurry or particularly motivated to get the case resolved early. They know premises cases are tougher for plaintiff’s lawyers as there are many easy and effective defenses available. The defense lawyer’s tone tends to change shortly before trial. That is when the fear kicks in. The only thing a defense lawyer fears is a big verdict. Big verdicts mean the possible loss of the insurance carrier and the loss of future business. Remember that the business model for defense lawyers is to develop a book of business. With that established, the lawyer can make money letting associates do the grunt work, as well as bill a partner-level rate for trial. Defense lawyers are motivated the last week or two before trial to avoid the possibility of a bad result. That is the sweet spot for settling a large premises case. Unfortunately, it means investing a great deal of time, money, and emotion to get to that point.
Trends in Smaller Cases
In six-figure cases, it feels like there is less pressure on the defense. The defense views their downside as capped as there likely won’t be a very large verdict. These cases might be opportunities for younger lawyers to make their mark. With that, professional pride and professional advancement will play a role. Younger defense lawyers may put up a tough façade in order to establish a reputation that assures they will not be pushed around. As I worked my way through the hierarchy of cases, I had a dozen or more cases marked by the insurer changing law firms when it seemed like the case was breaking bad for the insurer.
Obviously, younger defense lawyers will want to be heroes, winning at summary judgment. But they will also want to prove they can handle cases through trial and deliver favorable outcomes.
Six-figure cases handled by experienced defense lawyers won’t cause them to lose any sleep. “It isn’t my money,” they seem to think. The claims file will be documented that the insurance company could lose. The amount won’t shock anyone. So, it will seem to be business as usual. The problem is that, in a premises case, insurance companies generally want to offer 1.5 times the medical bills. Thus, the fight is about valuation. Your job is to add value—to add heat to their assessment of the case. What can you do to make your case stand out? If you have done a good job at case selection, you’ll win summary judgment. That is probably the sweet spot for trying to resolve a smaller premises case (unless you are looking to gain trial experience).
Rule 3: Educate the Adjuster
Educating the adjuster is probably more significant on a low six-figure case. Adjusters may be focused on the notion that the defendants win a lot of premises cases. Thus, a detailed demand letter that cites evidence might help you establish that you are the exception to the norm, you’ve put the work into the case, and you are prepared to try the case if a reasonable settlement is not offered.
The big question in any settlement overture (whether oral or written) is, What should it include? Conversely, what should it not include? These questions won’t necessarily have absolute answers. Some cases have a greater priority to resolve—thus you might break some rules and disclose some information you normally would hold back for trial. I tend to hold back because I anticipate that the cases are going to trial (even though I know the statistics are contrary).
If you are sending the demand letter after you have served the complaint and taken depositions, you will want to discuss the evidence that supports beating summary judgment (if sent before the ruling), and you’ll want to address damages. You may consider including some video clips of depositions if they went very well.
Years ago, when mediation was more likely to lead to settlement (the early 2000s), I’d sometimes send a series of deposition clips to the adjuster (and to the mediator) two or three weeks before mediation. It is powerful to see incriminating words come from the mouth of a 30(b)(6) deponent—especially knowing the jury will see the same video clip if the case doesn’t settle. I’ve also sent video clips from depositions of the defendant’s experts. Consider your case and whether you want to focus the defendant’s attention on how bad their own witnesses look and sound.
On the one hand, that could spur settlement. On the other hand, that could wake up the defense counsel to fight extra hard about precluding the use of video depositions at trial. You’ll want a comfort level with your local evidentiary law before you put too many of your good trial cards on the table. However, it can help the insurance company better evaluate settlement by getting more money reserved to reflect your better chances of winning.
Learn more about how you can successfully resolve premises cases for your clients at the link below.
Advanced Premises Liability: A Guide Through Trial by Michael Neff
“Michael Neff provides a walk through of premises liability cases that is valuable to anyone litigating in this area. He covers [...] everything from strategy, dealing with discovery problems and spoliation, preparing and taking depositions of defendant 30(b)(6) depositions, the cross-examination of defense experts, fraudulent transfers during litigation, settlement, [to] details of trial and presenting to jurors. This is a treasure trove of information for anyone litigating a premises liability case. I highly recommend it.”
—Phillip Miller, author of Advanced Depositions Strategy and Practice and Focus Groups: Hitting the Bullseye