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Litigate to Negotiate

Updated: Jun 23, 2023

Litigation is a critical element of any claims organization's negotiation strategy. Without effective defense of a litigated case, negotiations suffer because adjusters must feel confident that litigation will help build evidence that gives them leverage. However, once cases go into litigation, there is generally a large disconnect between pre-litigation negotiation and post-litigation negotiation. Activity turns from negotiation to planning litigation steps. Negotiation takes a back seat to discovery. Plaintiff attorney's know this and take advantage of it.

Most carriers we speak with are dissatisfied with the value of defense counsel in bringing cases to a suitable resolution. Many accept this as the way it is. Many more are seeking a new approach. It is our experience that when suggesting changes to discovery that can help situate a case for resolution defense counsel seems, well, defensive. This is hardly productive, so we spent time considering why.

We came to two conclusions:

  • Defense counsel does not see their work as a vehicle to negotiation. Without this focus, they cannot contribute effectively to early resolution.

  • They are not good at negotiating (or supporting negotiation) because this is not their goal. Litigating is their goal.

This might seem odd as litigation plans should help position the case for negotiation. But it this is the case, why does that not happen? The answer lies in the fact that defense counsel typically does not take a deep dive into

the evidence of the case. We encounter defense counsel who is no better versed in the details of evidence than plaintiff attorneys. In fact, they see it as a distraction. They manage their time around the completion of the litigation process. They focus on steps.

For the most part, defense counsel engagement with evidence is focused on high level issues. Many claims professionals feel that the steps do not lead to resolution of the issues. In fact, they feel like they have no more leverage in cases after months or years of litigating (which comes from developing evidence on issues) than they did when they started. New information, however, is central to leverage. It can't just be new facts, though. It must be new facts woven into an overall position on the case. To accomplish this, litigation steps have to be seen as aiding litigation.

What happens when litigating is disconnected from negotiating? Litigation ends up gathering information without developing evidence. If you take a moment to review the information "gathered" in discovery on cases you have handled, you will find the vast majority was either already known or otherwise unhelpful. It didn't change your position or your ability to negotiate effectively. Developing evidence means understanding how the material you already possess can be used to accumulate admissions from witnesses that contradict, undermine and/or weaken the claims the claimant is bringing. It is essential to creating leverage in negotiation. No leverage, no progress in negotiations.

What do we mean by developing versus gathering evidence? Take this example. Implicit in every personal injury case is the "claim" that the claimant suffered some functional impairment. This claim must be true because without it, there is no basis for treatment and almost no basis for pain and suffering. It is rarely the focus of a coordinated attack that used admissions by the plaintiff and their medical providers to demonstrate what we find to be a common lack of evidence for this claim.

In most cases we see, basic information about functional capacity is either not captured or so inadequate medical providers are unable, if pressed, to speak with the precision required of an expert about it. That is, they may be "experts", but it is not relevant because they can provide no direct evidence of the claim. Many defense attorneys believe this is either too technical or that medical providers will just talk around these questions. Questioned properly though, the expert must ultimately "admit" their clinical findings do not allow them to confirm claims about the severity of the injury. Have you ever seen this happen?

Most defense attorneys let providers get away with skirting the real issues. This is not because challenging and limiting their testimony is not possible. It just is not part of the plan. There are two reasons. First, this takes time and expertise that defense attorneys do not have. They do not know how to structure the questions that get admissions while isolating their dependence on their "expertise" as the answer to technical questions. Their testimony does not expose the fact that they lack the most basic information to demonstrate they actually have expertise. Second, they tend to evaluate their questioning in terms of trial. When they do this, it is easy to simply forgo the technical questions. They seem to deep for a lay audience. The result is that no negotiation leverage is gained, because the value of the provider's testimony has not been undermined.

To develop evidence that control the narrative and undermine credibility planning is needed. This means knitting together series of admissions that collectively present conclusions that cannot be ignored. For example, combine the above example with other admissions commonly available. These include unsupported diagnoses, the improper use of many diagnoses rather than focusing the right one, the many fundamental contradictions that exist within their reports, treatment records that demonstrate repeated use of the same treatment despite obvious lack of value, etc. Stringing together admissions about these facts deals a blow to the plaintff's case. Before worrying about or dismissing these admissions, they have to be obtained.

The fact that these sins of omission and commission in medical records are so prevalent in their records (the evidence that they have to testify from) reflects the fact that medical providers are not taken to task over them. The evidence is not developed through careful analysis. These admissions create leverage. Stock discovery does not. Layer on top of all this the lack of a negotiation plan between defense counsel and the adjuster and litigation becomes expensive and unproductive. Adjusters and defense counsel talk about discovery to be completed frequently. Simply knowing discovery and reviewing what new information was gathered might generate an opportunity, but this relies upon accident, not intention. The remedy starts here. Enlist defense counsel in two basic exercises that change the course of the case:

  1. Draft a summary of the plaintiff's position and defense position. What is the plaintiff claiming? How is it supported by evidence and testimony? What admissions can be gained using that evidence and testimony to weaken it? This exposes the opportunity. A discovery plan follows that is customized to the case.

  2. Defense counsel needs to be tasked with regular contact with plaintiff's counsel as part of a negotiation plan. These contacts should focus on the many shortcomings that have been, can be and will be exposed. Reinforce the risk of failure for the plaintiff.

Summary: Focus on litigation as a leverage tool to support negotiations. Don't negotiate to avoid litigation and trial.

For more information on how Casentric can assist you in this process, contact us.

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