Know the Potential for an Outlier Situation

Sometimes the other side knows something you don't

Obvious, right? Of course it is, but it is also something that is easily overlooked or forgotten.

We recently resolved a pre-litigation matter where I have no idea why the other side paid what it did - a not small amount either. Our case was marginally viable - and that is probably a generous assessment. When the potential defendant suggested we discuss settlement, we reassessed the case. It didn't look any better.

There was something about this situation that troubled the other side. Whatever it was, it troubled them a lot. I have no idea what that was, and I almost certainly never will.

When I was a defense lawyer, I had a case that was awful. The doctor's conduct was just gross - and he was an unappealing character, to put it diplomatically. Damages were significant and real. Plaintiff's counsel was among the best. The case easily had seven figure verdict potential. The carrier wisely concluded we should try to settle the case sooner rather than later. A demand was solicited, and it was far under what we expected. The ultimate settlement barely broke into six figures. From my perspective, the matter was almost given away. To this day, I have no idea why.

You don't see cases like the above every day. They are relatively rare, but not so rare that I am surprised when it occurs. Bear in mind, I am not talking about scenarios where I suspect deceit. That's a topic for another time.

Most of the time, both sides are looking at any given case roughly the same way. If the lawyers know what they are doing, there is usually a significant overlap in their evaluation of liability and damages. In a medical malpractice case, the facts are there in the medical record. Most credible experts are going to interpret those records similarly, even if they might come to differing conclusions.

In theory, there really shouldn't be many surprises in modern litigation. Reality differs from theory - as anyone with much life experience understands so well.

Knowing the potential for an outlier situation is why good lawyers test the other side's valuation in settlement negotiations. Good plaintiffs' lawyers start out high (but not so high as to be silly) to account for the possibility that the defense might value the case higher than they do. Likewise, good defense lawyers start low (but not so low as to be insulting).

In short, good trial lawyers always account for the possibility that there may be something about the other side's case which is off the radar screen. It happens.