Litigation – Radio Guesting May 2, 2022

Transcript

00:00

Welcome to Networking Arizona with host, Carol blonder. You’ll hear interviews with businesses located throughout the valley. Networking, it makes a difference. In fact, Shane,

00:19

Welcome to the show everyone and Happy May to everybody out there. We’re live on Facebook. So I want to say hi to everybody out there, like us and follow us. We’ll share the show a little bit later on. I’m gonna go in with Networking right away, because I’m excited about bringing on my first guest, who has been on with me quite a long time now, a busy been bringing in some of the other attorneys and I have with me now Troy Froderman, and he’s one of the principals of FR Law Group. Welcome back to the show. I have you in the off, in here live with me, and I’m so happy to have you back. Tell everybody a little bit about yourself what you all do.

00:52

Thank you, Carol. So FR Law Group is comprised of seven lawyers, and a couple of paralegals, mostly what we do is we represent businesses, we represent them before a lawsuit is initiated. And we also represent businesses when they are in court. And in the midst of litigation. Personally, I came from a different background, I was with international law firms for 28 years. And my partner, the other co-founder, was an in-house general counsel for a fortune 100 company. And both of us were on the road a lot, litigating cases throughout the country sometimes in the United Kingdom. And we’d had enough. So we were both at about the same point in our careers, that we decided that we would do something very radically different, which was to open up a small boutique for us is different. So what we do, which I think is unique, is that we bring very vast experience representing global corporations with all of the strategies and the litigation experiences that you’d normally don’t find with a boutique law firm. And so we’re able to bring that expertise and that experience to small and medium sized businesses.

02:10

Now you also work nationwide, we do you and you do free consultations for everybody. We

02:17

do. So mostly, I’d say. We do primarily business litigation, which falls into two different buckets, if you will. One is we write we do a lot of construction litigation, representing contractors. We also do a lot of insurance litigation. But we represent corporate policyholders against their insurance carriers, when there’s either a denial or reservation or difference of opinion in terms of whether something is a covered loss or not.

02:48

Now, today, you said you’ve been bringing up litigation a few times here, you wanted to talk about the cost of litigation. And I mean, there’s two ways to look about the cost as I tell everybody what you want to talk about today.

03:02

So litigation in and of itself can be very terrifying to businesses and individuals. It can be very harrowing, if you’re actually writing the checks to fund the litigation. So there are essentially six different areas that I want to cover quickly today, on the cost of litigation. One is obviously the amount of attorneys fees it will take to take you from the beginning of a case to either a bench trial or for a jury verdict. Secondly, is just the costs associated deposition, transcripts, things of that sort, resources. So just because you’ve hired a law firm, to handle the case, that law firm is going to be looking to you your business, to provide it with the documents and the information, which means that you’re going to have to take away some of your staff from what they’re doing, which is to generate revenue for you to assist the lawyers in handling the case. So

03:57

We’ll stop there because I want to go. I’m gonna take them one by one. Okay. Obviously, it’s cost we know what you try to do. And I think I want to make this clear for the people out there as you try and make it so it is you’re on top of it beforehand, obviously, so that you don’t maybe have to go to litigation. Right? Right. So

04:17

Something that we express to our younger lawyers. One thing clients do not like is a surprise. They don’t like getting something in the mail, which is a very large attorney’s fees bill, without having any understanding as to why this time was spent, why you needed to do it, why you had so many people doing it. So one of the acronyms that we follow is FSB fully show your budget to the client and then another FSB is fully support that budget. So if you’re told the client is going to cost, I’ve just got to come up with a number of $100,000 to litigate the case. There are certain benchmarks throughout the case that had to be met either because they’re rules of civil procedure, or just something that the other side and you have agreed on, you have to have a very detailed budget, so that you’re keeping within those constraints. Now, just like everything else, not everything is predictable, things change, surprises, he may learn that your client said that they didn’t have any documents. And in fact, they have eight terabytes of documents. So you need to go back to the client. And this is what we do is kind of think of it as a change order with a construction contract, be transparent with the client, because at some point, it may not be worth the client. For them to continue the case. Well, I

05:39

was going to ask you, because I’m not sure how it works. And that’s what you’re here to do is explain it, which I think is really neat that we’re taking it down like this. We’re talking about a bill, you take care of those things first, is that how they did? And then you build them? Or do they? Or does it? Or do they choose to have them on top of it so that they’re, let’s say, paying along as they go? How does that work?

06:01

It really, it’s, it’s different for every matter, it can be different for every matter. Some clients want to give a large retainer, and then you just build off of the retainer. Some clients want to just be billed monthly. And depending on the nature of the case, which is usually on a personal injury side, but sometimes we do it on the insurance side, you may do it on a contingency fee basis.

06:25

I understand that. One of the last things that you said was number three was also when you said cost, and I got it in my head right away. I was kind of thinking, okay, there’s cost meaning the money is out of pocket. There’s also , it’s costly because it costs you time. Right. Away from your business? I’m assuming.

06:46

So the cost? Let me touch on that real quickly. I think what is shocking to laypeople is when they get that first bill, and they see that it costs $1,500 just to serve the complaint with a process server? Because that’s you know.

07:04

I know, I understand why people have to understand there’s a cost to this. Right, and

07:09

Deposition transcripts are, I think most people that are accustomed to litigation, are staggered by how much it costs. A simple deposition transcript to have it printed for you can usually be anywhere from $2,500 to $3,000. And that’s not if it’s, you know, that’s not really a very involved deposition. Plus, today, obviously, there’s a lot of remote depositions taking place either by zoom or teams. And the cost for that just for the video production can equal or be greater than the deposition transcript, but to your point, so there is the time element as well, you know, opportunity costs. One thing that we try to express to our client is that we’re going to need somebody at the company who we can go to, and you know, not overwhelm them. But seek information from them. Because, you know, we don’t have it yet. We have to have the information. This isn’t the Old West, where you wait until trial, and then you spring the impeachment evidence on the other side, which was fun to do. But that’s not the case anymore. Everything has to be disclosed upfront, which means you need to start doing your homework immediately. Sometimes clients will say, well, why are we spending this much money? Now, we haven’t even gotten a trial date. Well, all of these things add up. Preparation.

08:30

Right. Preparation, and it costs money. But what I do know about them is that you try and make it, so that it is as affordable as possible. But you gotta make sure it’s all spelled out about the case. Each case is different.

08:44

And one thing I learned as a younger lawyer from older lawyers is that a small case can take as much time as a large case. You just never know. No, and so oftentimes, unfortunately, for small businesses, it’s cost prohibitive, unless you have some type of alternative arrangement with a law firm. That’s

09:02

where you come in, though, to have that consultation to find out where what kind of cases is, what are we looking at? Is it worth it to do it in the first place? We’re gonna go for a break. When we come back. I want to talk a little bit further, obviously about this. Write the number down. You never know when you’re going to need it and put it in the phone. It’s 602-566-7425. They do free consultations. They do work nationwide, and you could check them out on their website. It’s frlawgroup.com. Hang tight, we’ll be back in just a minute.

12:41

Welcome back. You know, I love what we’re talking about here, because you really, when you talk about transparent, you’ve been very transparent right now. And I think it’s important for people to hear that you are willing as a lawyer because everybody thinks about lawyers the same way, right?

13:01

Mostly yes. So, you know, I’ve been doing this long enough Carol, that I enjoy practicing law. But what I really don’t enjoy is disappointing a client. So I’d rather be upfront at the beginning, and let them know that you’ve made your case has merit. But unfortunately, you’re up against ABC Corporation, they will spend, outspend you to two or three to one. So let’s see if we can’t reach some quick resolution, you’re not going to be happy with it necessarily. But you’re really not going to be happy with me, if I let you go down this path. And then at the end of the day, he spent, you know, $300,000 to collect $50,000. Sometimes it doesn’t make sense. It doesn’t. And so the other two things that really I think are a cost one is stress on the client. So not most people do not get involved in lawsuits. And if they do they only do it once. Unless you’re a large transportation company and you’re used to getting sued, or something like that. The stress of a lawsuit. I cannot be overstated. So I always have that conversation with the client upfront. Are you ready for this? And sometimes they are, so we proceed. Other times. They’re like, wow, I hadn’t thought about that. You know, is there a way we can do this short of actually having to go to court?

14:30

Well, I would think a lot of people right away it’s, I want to go to court. I want to get them you know because they think their case everybody thinks their case is a good case. Sure. Right. But then let’s say somebody’s you’re working with them and just out of curiosity because I want to know the other three that appointed you want to bring up but let’s say somebody is going along with you and right now that they’re saying yes, I want to do it, but then they find out maybe you’re right.

14:55

So I think two things on that. One, it’s very important for the Law Firm & for the relationship lawyer to be very communicative with the client. And what I mean by that is, pick up the phone, let them know what’s going on, send emails, have regular meetings, where you’re not charging the client to meet with them all so that they can understand what’s going on again, they should not be surprised, they should be aware of what’s going on. Really, the other thing that I was going to touch on is, so fortunately, it doesn’t happen that often. But they’re, you know, any lawyer who tells you that they’ve never lost a case, don’t hire that lawyer because your odds aren’t good. Because you’re gonna be the loser. So what happens in a lawsuit, if it’s a breach of contract, and you go to jury or just a bench trial, the prevailing party under Arizona law gets to recover its attorneys fees. So here it is, you’ve paid $100,000 to sue them, you’ve paid all these costs, you’ve lost all of this time, you’ve had all this stress. Now on top of that, you’re paying their attorneys fees, and it could be as much if not more than what you’ve done. Now, that’s a sad day. And that’s not going to be something that’s pretty. And so, you know, ultimately, you should most cases settle because of all of the things that we’ve just been discussing. That doesn’t mean that cases don’t go to trial, because they do. It’s a little different in the world today, just because everything got logjam like everything else in life. Right. But if we do one thing well, which I know is this, we have relationships with our clients. There, we get invested in their business, we understand their needs, we understand the goal. And the goal isn’t to line the pockets of the law firm. It’s to make right why the client came to you in the first place. Right.

17:06

I think it’s important for people to understand that you’re all about servicing your clients making sure that they understand you talked about transparency as saying it again. But that’s what it’s all about communication, communication, being upfront and talking. Let’s see what we can do. Even if you don’t make as much as you thought you might, it’s better to get something than nothing, right?

17:30

Well, maybe I’m old school in this way, that the practice of law is just that it’s the practice of law, you don’t go into the practice of law to become rich. Sometimes that happens to lawyers, a lot of lawyers who don’t make any money at all. Depends on what kind of attorney it is. But nonetheless, the goal is, is to practice law in an ethical way, that you’re bringing justice to whatever system you’re in

17:58

their phone number to call, write it down and put it in your phone, this it to be everybody really should always especially if you own a business, you’re in a business that you might need an attorney like this is it, you have it, and you can have that consultation with you beforehand, again, even before anything happens.

18:15

We do that all the time. I probably had a half a dozen free consultations last week. I got one today at three o’clock. And, again, we have the experience to be able to be completely candid with you in terms of not every case that comes to us do we say, “Oh, you got a great case” No. That more often than not, they don’t. And that’s and that’s not because they’re coming across in some way that you know, they’re trying to get one over on somebody. It’s just, you have to take the facts, then take the law and apply them to the facts. And sometimes you may have a good factual situation, but the law doesn’t support you. Their

19:01

phone number is 602-566-7425. They do free consultations. We’ve got a couple of just this afternoon that he’s doing. It’s frlawgroup.com. Go ahead. Was there any more of the points that you wanted to bring out? No.

19:17

Again, I’ll just here’s another example in terms of we don’t do personal injury, but I had a client ask me when I talk with one of his relatives who had been injured on the job. So it sounds like workers compensation. So they say sure, I’ll talk to them, see if I can at least point something out to them. And their objective. And there was there’s not attorney client privilege here because we didn’t engage in that their objective really was to find out was there a way that we can sue the employer directly? And again, that’s another situation where the facts don’t fit the law because for and being a corporate lawyer, I don’t do workers comp but I know that in order for the employee to sue the employer, there has to either be gross negligence, or some type of intentional conduct.

20:05

I know somebody who tried to do that. And I’m sorry. You know, sometimes it’s just best to turn away and walk away, right? Because in those cases, and I say I didn’t want to say to her, but really the truth is, is that you’re not going to win, you’re not going to win, especially when they have the, I’m not saying you don’t have big guns but big money, that that your your client may not have that be able to even you know, how to how do they stand? How do they stand a chance? Unless they got a fantastic case?

20:35

Yeah, well, in that context, there was no evidence of gross negligence or intentional conduct. So the only remedy available to that individual was through the Industrial Commission.

20:46

So you see, but you, this is where you come in to be able to talk to people you love that about, that’s what some of you like to get into somebody’s business and talk to them. And how could this relate to almost, let’s say, some of the other I know, we talk a lot about, you know, Construction Law. And insurance law, though, this is big time for almost anyone that has insurance like that.

21:08

Right? Everybody has insurance. And so having done this for so long, I’ve probably consulted litigated on every personal on every property line that’s available. You think about the insurance that a company purchases, and we’ve dealt with that. And again, not all claims have a valid claim. Under the terms of the policy. The policy, as we’ve discussed, is a written contract. And unfortunately, the insurance company writes the contract. And most times the business’s vast majority of the time, the business when they buy the policy, they never ask for a copy of the policy until there’s a loss. Right.

21:51

And so you’ve talked about it a lot. It’s all about knowing what your policy says. And that’s where you come in, to help them to understand it.

22:00

Right. And we do that a lot. We do that a lot with probably every industry that you can think of because every again, everybody needs insurance. And either it’s required by statutory requirements, or it’s just the nature of doing business.

22:15

What’s your final words for today?

22:18

Even though you may have a claim that you want to pursue. I think getting a second opinion is very worthwhile. If you’re coming to FR Law Group for the first opinion, you should go get another opinion. If you’re going to go to some other firm, come to us for a second opinion. Because it’s just like you wouldn’t have surgery performed on you without having two opinions from doctors. The same should be true with a lawsuit because the one thing we haven’t talked about, I know we have to go. It takes a long time. If you filed a lawsuit today in Superior Court, the trial probably would be in early 2024

22:57

Especially now things have been backed up so.

23:00

Yes, and the Federal Court forget about it. Forget about. Now, which you

23:03

want to do is you want to make sure you have that consultation with them because you’ll be able to tell them where they’re at right now. And by the way, even if it takes that long and you’re really going to go to litigation, you need that time to make sure that you have everything that you need to make that when. Their number again is 602-566-7425. It’s frlawgroup.com.