The truly pernicious effect of collateral fee cases

Like a lot of you, I'm sure, I've spent the past six weeks hacking and wheezing with various degrees of severity, rallying occasionally, as (thankfully) on Christmas Eve, but falling apart before and after.

As a solo practitioner, I have had more freedom than most to work from home while battling this plague. When I have had to come downtown, I've chosen to drive. Al Gore might be displeased, but anyone who might otherwise have been forced to sit beside me on the Blue Line---red-eyed, bleary, dabbing at drips of one kind or another---would probably absolve me. I have yet to try out my new Ventra card.

If that sounds like virtue-signaling (am I using that right?) keep in mind that while I have been heroically saving CTA passengers from my own sniffling and snorting, I have also been quite consciously avoiding theirs....

During my semi-confinement, I have had occasion to watch a lot of early local news broadcasts. And, while the political commercials are starting to crowd them out, even in my enfeebled condition, I have been unable to ignore the fact that a great many sponsors of the early evening newscasts are personal injury lawyers.

The taglines are all similar: If you don't win, we don't get paid! Or, putting an even more positive spin on it: We don't get paid unless you do! The word 'contingent' is never used but, of course, contingent fee arrangements are what these TV-spokeslawyers are touting.

If you've clicked here hoping for a nice screed against 'greedy trial lawyers,' I'm afraid I must disappoint. If there are some abuses (and there are), the contingent fee arrangement in personal injury cases usually serves the laudable purpose of getting representation for and, sometimes, compensation to persons who could not otherwise hope to afford a lawyer. And, while it's true, as the Judicial Hellhole folks charge, that there are some personal injury lawyers who rake in millions and millions from the misfortunes of their fellow human beings, that is only because these superior lawyers, through hard work and expertise, and demonstrated good results, have conditioned their fellow lawyers to bring them only the most substantial cases, from which they may pick and choose, and be quite picky about it. In short, the really good PI lawyers have any number of number 1 draft picks, and they hardly ever take Ryan Leaf. One might be sometimes jealous of their success---one can hardly be human otherwise---but the miniscule elite atop the PI pyramid have earned their wealth and fame.

And then there's the rest of us.

For most personal injury lawyers, including the TV pitchmen, a contingent fee case is by no means a sure thing. In one case, a settlement might make the lawyer a seemingly handsome hourly rate -- but the fee from the next file on the shelf, prorated over the hours expended, might not amount to minimum wage. And there are cases that seem so full of promise when the lawyer signs them up, only to learn that the clients were less than candid about this or that and the resulting fee---just like in the television commercials---turns out to be nothing at all. It seems counterintuitive, but a contingent fee lawyer's best, hardest, or most creative work often results in the least remuneration.

And then there's the fact that a lot of us lawyers don't work for contingent fees.

At least, not on purpose.

Although you'd never know it from the TV commercials, the contingent fee arrangement is not appropriate in a great many types of cases. In domestic relations and criminal cases, contingent fees are entirely prohibited. (See, Rule 1.5(d) of the Illinois Rules of Professional Conduct.)

Except sometimes in collection matters, you hardly ever see contingent fee arrangements in business cases. Smith insists that Jones breached his contract and they resolve to fight the matter out in court. All well and good -- but, if they attempt to 'lawyer up,' Smith and Jones will both have to pay their respective attorneys by the hour -- or at least pursuant to some non-contingent arrangement. And, generally, corporations cannot appear in court except through an attorney.

There really is no such thing as a contingent fee defense. If Smith sues Jones for a million dollars and loses, Jones's lawyer doesn't get a third of what Smith didn't get. Can you imagine? Jones's lawyer tells Smith's lawyer afterwards... next time sue for $10 million; we'll split my fee and both retire?

And yet... the contingent fee has become so deeply embedded in the the public consciousness (thanks to the steady drumbeat of TV commercials) that people -- and, by 'people' I mean clients, as opposed to lawyers, although leading scientists insist that lawyers are people, too -- start to think that if they don't win their case, or if they don't win their case fast enough, they can stop paying their lawyer. If you don't win, the thinking seems to go, you're not getting paid.

And clients can be pretty impatient. After all, on television, the thorniest legal problems are usually wrapped up in 40 minutes or less, exclusive of credits and commercials.

All lawyers know this; some exploit it.

The TV pitchmen sometimes warn that insurance companies will stall and delay unless you, the injured viewer, has the good sense to sign up with the firm running the ad. But some lawyers---any is too many, if you ask me---will use discovery to stall (and bleed) the party on the other side who's paying for representation from his or her own pocket.

Have you ever seen a bullfight?

The matador does not fight the bull one on one; he does not go for the kill right away. He relies on picadors and banderilleros to poke and jab and bleed the bull, softening it up before the matador dares the killing stroke. Similarly, the unscrupulous attorney does not go for the merits of a case right away; written discovery, depositions, discovery motions, are all jabbed into the uninsured client's hide, softening the opponent for a low-ball settlement or even an unfair dismissal.

The bull is unrepresented, and must die at the end of the bullfight. The uninsured, but represented, client, paying from his or her pocket, has a chance to avoid the bull's fate, but too often the client's good judgment, bled by unnecessary (but tactical) discovery, becomes clouded. The lawyer's fee may slide from a debt of honor to contingent status.

We can almost never wrap up real-world legal dilemmas in 40 minutes. But we can involve the court more intimately in the discovery process -- requiring the court to decide what discovery may be propounded in the first place, not waiting until a dispute arises and then, perhaps unfairly, settling it.

I call this zero-based discovery. (You can read more about this by following the link. I hope you will.)

Zero-based discovery could help clients avoid the legal fatigue that comes from being bled by discovery -- and help their attorneys get paid in a timely, as opposed to improperly contingent, manner.

Solving the Pro Se Revolution, and putting lawyers back to work, too

The October 2017 issue of the Illinois Bar Journal features an article by Ed Finkel, "The Pro Se Revolution," concerning the May 2017 Strategic Plan issued by the Supreme Court's Commission on Access to Justice.

There have always been pro se litigants. In days of yore, it seemed like pro ses were mostly party plaintiffs, rumpled men or women with piercing stares and unshakable confidence in the merits of the most dubious cases. As a young lawyer, I knew, when arriving for a Law Division morning motion call, that if three or four deputy sheriffs were present, there was a pro se case on the call that day.

But if there are still pro se litigants like this, and there are, they are far outnumbered, these days, by normal, average people who simply can't afford, or who believe they can't afford, legal representation. From Mr. Finkel's article:

Data from the Administrative Office of the Illinois Courts ("AOIC") show that in 2015, nearly two-thirds of total civil cases outside Cook County - 65.2 percent - had at least one self-represented litigant. For certain types of cases, this figure rises as high as 80 percent. In addition, the court system is facing the facts that one out of five Illinois residents speaks a language other than English at home according to U.S. Census data, the number of Illinois residents below the poverty line has grown, and the number of pro bono attorneys has not kept pace.

Finkel quotes Appellate Court Justice Mary K. Rochford, who chairs the ATJ Commission, as saying "people cannot afford legal representation for many reasons beyond our control, and often parts of our state do not have enough legal aid attorneys - and legal aid attorneys are facing their own economic issues.... Our focus is on how we can help the self-represented litigant navigate the court system, and have a full opportunity to present their claims and defenses. We wish everybody could afford a lawyer."

There is a way.

But it will take a lot more than merely streamlining existing procedures.

Why have legal services been priced beyond the reach of so many civil litigants?

In a word, discovery. Largely unfettered, "routine" discovery grossly inflates the cost of any litigation. Frequently deployed as a strategic weapon -- the pious admonitions against this practice in the cases notwithstanding -- discovery too often bleeds an opponent into either submission or bankruptcy.

The word discovery appears twice in the ATJ's Strategic Report, first at page 2 of the Executive Summary:

If more than half of the users of the civil court system are unrepresented by counsel, is it still feasible to require strict adherence to rules of civil procedure, discovery, and evidence?

The second and final appearance of the word comes at p. 27 of the Report, under Initiative 5, concerning the possible simplification or streamlining of existing court processes. The Commission report notes that, in civil cases in which less than $10,000 is sought, the Illinois Supreme Court has, by rule, done away with discovery except as permitted by court order (Supreme Court Rules 281-289), and in other cases, in which less than $50,000 is sought, imposed some limitations on "routine" discovery (Supreme Court Rule 222).

These rules are on the books now and the pro se crisis is growing. The ATJ Commission "proposes to gather information about simplification efforts in Illinois and in other jurisdictions, with the goal of evaluating the potential benefits of such efforts in additional areas of law" (p. 27).

But further nibbling at the edges of the monster that is unfettered discovery will prove unavailing.

What is required is a fundamental shift in the attitude of judges and lawyers toward discovery. We need to go back to the future.

In Lincoln's day, a lawyer seeking discovery in a tort or contract case had to file a separate chancery action, a bill of discovery, in order to -- possibly -- obtain discovery. We don't need to go back to that model exactly.

But we do need to make judges the gatekeepers -- skeptical gatekeepers -- as to what sort of discovery may be allowed in any case. I call this zero-based discovery.

Right now, discovery is supposed to take place largely off stage. The filing of discovery requests and discovery responses is actually prohibited (Supreme Court Rule 201(m)). The success of discovery depends on the cooperation of counsel (or counsel and any self-represented parties). In other words, it is a system that too often fails on contact with unhappy reality.

When it comes to discovery matters, judges are like parents driving kids on a long-distance trip. Discovery is what goes on in the back seat -- and when the inevitable squabbling takes place, judges don't know who started it, or why, but they need it to stop, and stop now! Order was usually restored when Mom or Dad threatened to pull over, but justice was not necessarily served. So it is with discovery disputes.

On the other hand, the judge who agrees that certain interrogatories will advance the conclusion of case for either trial or settlement, and who agrees on the formulation of those interrogatories, has an expectation of what will be asked and how it will be answered. The discovery manipulator who is never satisfied with any response will be cut off quickly when the allegedly offending party shows that he or she has met the court's expectations.

I know that many of my colleagues may blanch at the prospect of so limiting discovery. Discovery is often the chief means for associates to bill hours -- and fuel partner bonuses. And senior partners, at mid- or big-sized firms, are riding in the front seat along with the judges when it comes to discovery matters: They're often not paying attention to what goes on in the back seat either... unless one of their associates gets sanctioned.

But, even with zero-based discovery, judges would not always have to say no to discovery: When big firms, representing well-heeled clients, want to go after each other a bit, jostling for advantage, it's common sense not to get between them. But the judge who turns the lawyers loose on each other will have an expectation of what will emerge from the joust before it begins. Meanwhile, in most cases, the cost of litigation could come down -- way down -- with judges asking simple questions about why this deposition is necessary, or what a party expects to find in her opponent's documents. Imagine being the judge who, for the first time ever, gets to ask why a party needs his opponent to identify "with particularity, each and every data or document source" that opponent has "searched in responding to" a proposed production request. Imagine a judge sitting down with the parties at the outset of a case, asking what do you need, plaintiff, to prove your case that you don't already have? What do you need, defendant, to establish your defense, that you don't already have? What are the most efficient ways to get what you need?

Bring down the cost of litigation, bring back employment opportunities for lawyers. With zero-based discovery, maybe everybody can afford a lawyer. Less lawyers answering discovery... but more handling cases? That increases access to justice, does it not?

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For more on zero-based discovery, see:

• Reforming civil discovery – Part 1 – the problem of human nature;
• Reforming civil discovery – Part 2 – preserve the civil justice system by adopting zero-based discovery;
• Reforming civil discovery – Part 3 – how zero-based discovery can work; and
• Reforming civil discovery – Part 4 – one more post on zero-based discovery