Whenever I read a news report about a civil suit, I try to predict who will win. Evaluating cases has become a habit. Over my years practicing law, I have had to make countless decisions as to whether or not to take a case. Often, those decisions must be made based with only limited information available.
The decision to take or reject a case directly impacts my financial well being. It is very important that I get those decisions right. When I read about a suit in the papers, I can not resist the temptation to perform a similar analysis. It is a guilty pleasure.
News reports rarely contain a complete or accurate statement of the facts. There is no time to take a close look at the legal issues involved and there is no opportunity to interview and assess the credibility of the witnesses. Predicting winners based on news reports is obviously an inexact science.
Nonetheless, sometimes it is possible to get strong clues from news reports. Let’s look at a concrete example.
Julia points us to a Jeffrey Toobin article in the New Yorker about a suit over the rights to Winnie the Pooh.
First, a brief sketch of the facts of the case:
In 1930, a literary agent named Stephen Slesinger acquired the merchandising rights to the Pooh story from A. A. Milne, who created the inhabitants of the Hundred Acre Wood to entertain his real-life son, Christopher Robin Milne. In 1961, Shirley Slesinger, Stephen’s widow, signed those rights over to the Walt Disney company in return for four per cent of the revenues that Disney received from Pooh merchandise. Thirty years later, the Slesinger family sued Disney for breach of contract, claiming that the company had stinted on the royalties.
So, who is going to win? Before you decide, let me give you a few more items of information. The case has been pending at the trial court level for twelve years. It is the oldest current case in Los Angeles Superior Court. Dozens of lawyers have worked on the case and each side has recently hired a high profile lawyer. Daniel M. Petrocelli (who represented the Ron Goldman family in the civil suit against OJ) has been hired by Disney and Johnny Cochran has been retained by the plaintiff.
To get a feel for who is going to win the case, three more pieces of the puzzle are helpful. First, it would be nice to know why the case has been delayed for so long. Secondly, you should carefully assess what the lawyers for each side are saying. Third, look to see who wants a trial and who wants further delay.
In the Winnie the Pooh case, it appears that the delay was caused by discovery disputes:
But most of the delays seem to be the result of lawyers fighting with each other. At one point, early in the case, a second judge was appointed just to handle arguments about the discovery process. Another time, Disney was sanctioned by a judge for disposing of the files of a company executive who negotiated a 1983 revision of the original contract with the Slesingers.
“The question in this case,” Cochran said the other day, “is ‘Does the Mouse keep its word?’”
How about the defendant’s attorney?
The latest turn has Disney accusing the Slesinger team of misconduct for, among other things, rummaging through the company’s garbage. After first dismissing the charge—“I don’t like ketchup on my exhibits,” one lawyer scoffed—the Slesingers’ attorneys conceded that they did take documents from what they called a “publicly accessible” trash container. “There’s been a massive coverup here, and egregious misbehavior,” Petrocelli said.
The third factor is to determine who wants to go to trial and who wants to delay. That is the clearest indication of who thinks they have a good case. Cochran is again straightforward:
“We need to get all this stuff out of the way about who went through what trash,” he said. “This is a case that should go to trial, and that’s what I’m going to do.”
“And we’re going to a full hearing about what they did, with witnesses, on January 20th.”
The lawyer who wants a trial thinks he is going to win. The lawyer who wants to spend lots of his client’s money talking about issues other than the merits of the case is trying to avoid a trial. Usually, when a lawyer does not want to go to trial, it is because he has a lousy case.
All told, I expect that Cochran will push the case towards trial and, at the last moment, the parties will reach a settlement. The terms of the settlement will have the plaintiff singing a song about “a tubby little cubby all stuffed with cash.”
Usually, when a lawyer does not want to go to trial, it is because he has a lousy case.
I'd disagree with that. Going to trial is always a roll of the dice; you never know what a jury will decide, and it's easy for an idiosyncratic judge to knock you out of court with evidentiary rulings even if you have a strong case. In my experience, it's rare for either party in a civil case to want a trial, even though they may say so in order to intimidate the other side.
Jonathan:
Sure everyone would rather have a fair settlement than a trial. A fair settlment eliminates risk and expense. How does one get a fair settlement?
In my experience, even with a very good plaintiff's case, the defendant always seems to have trouble focusing on the need for fairness.
The best solution for me has always been to push the case to trial. The prospect of 12 ordinary citizens with the power to take out the defendant's check book and start writing seems to focus the defendant's mind.
When I defend, the plaintiff's demand also tends to get much more reasonable as the time to test the proof approaches.
Getting to trial is where the rubber meets the road. The very best way to settle a case is not to need to settle.
Posted by: dwight meredith at December 16, 2003 05:09 PMI have nothing substantive to add, but I will blame you when my wife catches me singing "a tubby little cubbie all stuffed with cash" to the kids ...
Posted by: kevin at December 16, 2003 08:20 PMIn my experience, even with a very good plaintiff's case, the defendant always seems to have trouble focusing on the need for fairness.
Naturally. Not to mention that the defense firm's interest in milking the case as long as possible creates a disincentive to settle prior to jury selection.
When I defend, the plaintiff's demand also tends to get much more reasonable as the time to test the proof approaches.
In my experience - and I've also worked both sides - the plaintiff tends to get serious once the defendant does. There's no point in moderating a demand until the defendant is serious about settling, because then the plaintiff will end up bidding against himself.
As you can tell, I have a somewhat jaundiced view of the system. I think that many cases that should settle early end up dragging on until jury selection because both sides are more interested in jockeying for tactical advantage (e.g., with discovery disputes) than in getting down to the merits. Thus far, none of the many judicial and legislative attempts to encourage early settlement have succeeded, so this sort of maneuvering is probably a built-in feature of adversarial litigation.
Jonathon:
You might be interested in the latest study of how federal court suits are disposed of. See http://www.nytimes.com/2003/12/14/national/14TRIA.html there. Lots of cases are decided on motion. Many by way of ADR such as arbitration or mediation (I am very much in favor of mediation as a settlement tool, perhaps because it has proved succesful for me in a number of large cases). The percentage of cases proceeding to trial is about 1/3 of the number being tried in the early 1960s.
Very interesting stuff.
Posted by: dwight meredith at December 17, 2003 12:22 AMYou might be interested in the latest study of how federal court suits are disposed of [...] Lots of cases are decided on motion.
This has a great deal to do with the Celotex-Anderson-Matsushita trilogy of Supreme Court decisions in 1986 that made summary judgment much easier to get. Before the mid-1980s, summary judgment was regarded as depriving the plaintiff of his day in court, and it was very difficult for a defendant to force a disposition prior to trial against the plaintiff's will. Now, a summary judgment motion often is the plaintiff's day in court - if the plaintiff has enough to survive SJ, then the defendant gets serious about settling.
Many by way of ADR such as arbitration or mediation (I am very much in favor of mediation as a settlement tool, perhaps because it has proved succesful for me in a number of large cases).
I also like mediation when it's consensual, but many ADR cases aren't, and recent case law has increasingly validated adhesion contracts requiring arbitration in the consumer and employment contract. I'm sure you've heard of the Gateway 2000 cases, in which a shrink-wrap license not only required arbitration but set rules so onerous as to leave consumers without effective recourse. ADR is often a form of forum-shopping.
If fewer cases go to trial today than in the 1960s - and I don't doubt it for a minute - I remain unconvinced that this is due to any reform in adversarial litigation. Instead, much of the difference is because more cases are taken out of the adversarial process at the pretrial stage. This would be nice if it resulted in more equitable settlements, but my experience has been the reverse - both SJ and ADR as currently used tend to favor large institutional litigators.
Well, the Slesinger v. Disney case must take some sort of record for longevity before getting to trial. However, I do believe that the Church of Scientology takes the cake when it comes to delaying tactics. The case Wollersheim v. Church of Scientology of California, started in 1981, more or less wound down earlier this year when Scientology suddenly decided they'd pay Wollersheim the money plus interest he'd been awarded almost two decades previously. In the interim, the case had been appealed numerous times, including two trips to the U.S. Supreme Court. It's believed that Scientology settled because the last judge on the case was going to allow Wollersheim to "pierce the corporate veil." The CoS of CA no longer exists; it was looted to deny Wollersheim any recovery and the monies were transferred to CoS International.
Another case that has been going on for nearly seven years, with something like six trial dates set and passed up is the wrongful death case of Lisa McPherson in Florida. Yes, you guessed it, another arm of Scientology is involved. The lawyer for the family, Ken Dandar, has doggedly pursued this case despite insane legal attacks, side cases launched in other states, and more attempts than I can count to try and remove him from the case.
These are but two of the cases that Scientology has been involved on. Back in the late 1980s, over 2000 cases were filed by Scientologists against the IRS because the IRS wouldn't allow a tax deduction for Scientology "services". The IRS settled with Scientology in a secret agreement in 1993. Part of that agreement allows Scientology a tax deduction for the expensive "services" that Scientology offers. A Jewish parent in Los Angeles discovered this secret tax exemption and tried to take it himself for his kids' Jewish school tuition. A judge ruled (a) he couldn't do it, and (b) the IRS shouldn't have given Scientology that exemption either but he was powerless to do anything about it, because the exemption is still secret.
With all the things Scientology has been involved in over the last 50 years of its existence, I have thought that someone could profitably teach a 3rd year law school course on Scientology litigation strategies. Disney has NOTHING on these people.
Posted by: Deana Holmes at December 21, 2003 11:03 AMMissing from the NewYorker article is a bit about the Sony Bono Copyright Term Extention Act (SBCTEA) and how a small feature in the act allows Disney to stop paying the Slesinger family. The clause allows copyrights that had been sold, to be reclaimed by the natural heirs of the original author, if certain proceedings were filed in a short window after the act was passed. Very few people saw this and recognized it for what it was intended for. It was added for the benefit of Disney, to take the copyrights away from the Slesingers, since the heirs of Milne offered them for much lower royalties. Adding this clause to the SBCTEA will pay Disney back millions of dollars per year. The Mouse wins again!
Posted by: Peter at December 22, 2003 07:59 PMDwight:
I haven't seen the Toobin piece, but this litigation was the subject of another profile in Fortune (subscription required for full article) last year. I recall that it was, unsurprisingly, somewhat less sympathetic to the plaintiffs than you describe Toobin's piece as being.