The importance of having a business lawyer on your business’ side – Radio Guesting Sept 10, 2020

The importance of having a business lawyer on your business’ side – Radio Guesting Sept 10, 2020

| Blog News & Updates Outside General Counsel



Welcome to the show everyone. We’ve been having fun in here talking already just before the show. Now we’re having fun networking with everyone out there. We’re live on Facebook. So hi to everybody out there like us and follow us. We’re going to be sharing the show in just a little bit. I cannot wait to bring on my first guest because I know he loves talking about what we’re talking about. I have with me, Troy Froderman. And he is one of the principals of the FR Law Group. Welcome to the show. Tell everybody a little bit about yourself, what you do, and what ,what we’re going to talk about and why you love talking about it so much. Thank you, Carol. So I’ve been practicing law here in Phoenix for over 30 years. And for many years, I was with a large international law firm responsible for hundreds of lawyers. And it’s better than any drama then you could probably watch on television.


So after 28 years, a neighbor and I decided that we would start a small litigation practice, and give us an opportunity to hone our skills in the areas of law that we really enjoy it.


Kind of like a golfer when they get into their 30s. That’s the prime of their career. And for a lawyer, anywhere from the early 50s, to the late 60s is the prime of our careers. So I wanted to spend that Prime Time, if you will, doing what I really have a passion for. Well, I got an email from me today and you said you really wanted to talk about a subject and I love it, it mean when we say this, because I’m not saying that I’m happy when that happens, but I love the way you did it. It’s oh no, I got sued. I’m getting sued. Tell everybody a little bit about your, where you know, the area of practice of the law that you like to work with, right? And what people should do because you know, you know, a lot of


People don’t realize that when they get sued, they really got to make sure that they have somebody on their side like you. So there are very few things other than being sued that freak people, loss of the loved one, the loss of a pet, loss of your home.


The IRS getting sued is right there. Sure along with all of that, it’s an emotional toll that takes place and that’s a monetary toll that takes place. So there really if you want to think about it in terms of what we do, we’re any litigation boutique. And what we do is we represent businesses. And we both sue other businesses, as well as defend our clients who get sued by other businesses. And more to the point what I do, mostly, is I represent policyholders when they get sideways with their insurance carrier, so just like individuals


Companies, businesses have their own insurance. And when they suffer a loss, and that loss could either be there’s a large litigation that’s taking place and they’re a defendant. And they think that they have coverage under their policy for their attorneys fees and costs, and potentially the judgment that might have been a web settlement. And it could either be through a property loss, it could be through a mass tort action, whatever the case is. So I get retained to try to get the insurance company to come in and step up and defend


the client and get the client indemnified should there be a settlement or a judgment. The other area of the law that we practice that FR Law Group is construction litigation. My partner was a general counsel for a very large construction company. And so, and he’s also a construction engineer by trade. So we do a lot of work with construction companies.


Just as you might imagine their day to day issues that they come across, as well as oftentimes we deal with their insurance carriers as well. So that’s really where we come into play. And in terms of the subject of “Oh boy, I’ve been sued, what happens now”. So there are some times when you can manage your risk and expect that there might be a dispute down the road. And that usually happens when there’s a contract in place. Or there’s a purchase order that is in place, things that you can anticipate and you can kind of manage the risks. Other times things just happen. And you can’t avoid that. You know, an example is COVID-19. Not to dwell into that subject that day, a great extent, but there are a lot of lawsuits that are stemming from the pandemic, between landlords and tenants, between customers for supply chains. You know, the list is endless. So what happens generally is when somebody has either been sued or they’re about to be sued, then that really calls into question, Are you prepared to fight it? And because like I said at the beginning, it’s not just a fiscal issue, but it’s also an emotional issue. And it’s also time.


If you’re in the business of breaking of making bread, and you get sued, do you want to spend 20% of your time dealing with lawyers? Or do you want to spend as much time as possible making your product. Meeting you gotta need the bread. So I’m talking about this, that what I know about you, too, is that what you’ve done is you’ve brought the big guns, the big gun lawyer to the smaller person that you know, business owner, that can work with you, right, you know, because you have you brought that experience is what you’ve done. Let’s talk a little bit about that. Yeah, that’s how I would phrase it. So the experience that we bring.


So we’ve had the good fortune of working with a lot of large clients who can afford much more than a smaller company to find cases and to spend money to throw lawyers at various issues. And so through that, you get a lot of training and you had a lot of experience. You get to know the judges, you get to know the back staff in the courthouse, which is always very helpful. And one thing that my mentor taught me and my father did at an early age is the person who is holding the door open for the jury is just as important as the judge, treat everybody as if you’d want to be treated with respect. And so we bring that type of experience insight to our clients. And we’re, you know, we’re not in the position where most of our clients are not 3M they’re not GM, right? They have a tight budget that they can afford to either prosecute or defend the lawsuit. And the, the number one thing that people don’t really appreciate is a small case can take as much time as a large case. And so you need to be very upfront with your clients at the very beginning. Here’s what to expect.


If I were the client, I would not want to be surprised at the end of the day and find out that a case that I thought was gonna cost $20,000 to prosecute turns out to be $200,000. That’s not a happy discussion at the end of that engagement. Right, you would want to make sure that you talk to everybody and have it laid out beforehand. One of the questions that I wanted to ask you is let’s see, somebody right now has just started a business and a lot of people have, and they can’t they hearing this and they’re saying, My gosh, I don’t even know what to do to protect myself. Okay. Can they come to you to talk to you, so that you can help them form what they need?


To so that nothing down the line. I mean, it could happen no matter what, but that they are protected and make sure that they are. Yes. In fact, we do that all the time, especially with the startup construction companies, because my partner’s got Ryan, he has that experience where he knows what needs to be in, in place at the very beginning of a project, and at the end of the project, and so we’re able to advise the clients, you know, have you considered X, Y and Z? Well, let me say this, and this is the kind of thing when you’re listening to this information here. And I love the show for that reason, because it is information for everybody out there, whether it’s you or someone that you know, that might need this right now, you might have gotten into something you’ve just gotten sued. Oh boy, what do I do, right? Or maybe you want to make sure that you already are protected. You can call them direct their number is 602-566-7425. You can check them out on their website.


It’s But they’re rated with the Better Business Bureau, they also work nationwide. So this is not just for us here but nationwide as well. And check them out on their website. It’s They do free consultations, and you can call them at 602-566-7425. Hang tight, we’ll be back in just a minute.


We’re going to continue kind of talking for you, one of the when you’re working with a smaller company, let’s say for those smaller businesses out there, what do you want to maybe have a story that you might have because those are always you know, kind of interesting too, as to who you might have worked with so maybe before we go to back to my that we’ve been talking to Facebook a little bit about maybe something that you have dealt with that where people just, you know, all of a sudden maybe they didn’t even realize they were getting going to get sued, and it came in to them. Well, there are various different examples, but one of the things that we, I’ve noticed over the last 30 years is just the general spin that keeps increasing with technology. So you would think technology would make things a little bit more streamlined. That’s not the case. So for example, when I first started practicing, there was no electronic storage of anything. It was, you know, in a box behind our desk or at the client’s office, it was pretty easy to figure out what needed to be reviewed and what needed to be produced. Now, text messages, emails, everything. So what happens is, if, if a client gets sued, the complaint comes along with a letter. That’s called a document preservation letter that says, You’ve been sued. You are under an obligation to not destroy any documents, whether they’re hardcopy, electronic text messages, etc. And if you do, then there’s a doctrine called spoliation and you’ll get a jury instruction read by the judge that says to the jury, they had a, they were told to keep these documents, and they destroyed them, because they destroyed them or they didn’t maintain them. You know, if they get overwritten by the software, you are allowed to presume that the information was harmful to


Wow. And so oftentimes we’ll have a client will come to us and they did something back in 2019. And they get sued in September of 2020. They didn’t know that they needed to keep it especially if it’s a new client. We had, we only keep the emails for 30 days. That’s our policy. So you know, that’s something to talk about too when we get back because giving them that information as to now first of all, everything’s all about covering, you know, your whatever. Right. And talking about to give them the information or do you know you’ve got to keep this stuff for X amount of time? And how, how do we do that? I mean, it’s, I mean, you’d have to have every little email every little text.

 12:12  It’s crazy out there. But let’s talk about that when we get back. Okay.

 12:22  I recognize.


So welcome back, everyone. We’re talking with Troy Froderman, and he is one of the principals of FR Law Group. And with the break, we’re talking, you know, when we talk live on Facebook, when we’re not on live air, and you were talking a little bit about how technology has changed so much, and some people don’t realize what they have to say what they don’t. So let’s talk a bit about some of that. Sure. So, again, not to sound like a grandfather here. 30 years ago, when I started practicing law, you were not obligated to really produce what’s called impeachment evidence, you can hold on to it. And you show up at trial, the witnesses on the stand, and you may not have anything in the impeachment envelope, you just want to mess with the witness. And so the witnesses on the stand, you’d say, bailiff, will you please pass the impeachment?


Then the witness will just melt in the chair? Well, we can’t do that. There is no hiding of anything. In fact, it’s just the contrary, you have to produce everything. So you would think that with technology that, that might streamline some of the process, it is not completely, completely the opposite. Because you, you, you’ll receive a lawsuit in the mail, and most times with the lawsuit, the complaint, there’ll be a letter from the opposing counsel, and it says, You are instructed not to destroy any documentation related to this particular subject. And even if you have a doubt that


Whether it’s related to the subject you have to maintain. And that includes hard copies, emails, texts, whatever’s on your server, your backup tapes, you got to save all of that. So, if, the here’s what happens. So a new client comes to FR Law Group or to a law firm, and says, Hey, I just got sued. I’d like to interview to see if you’d be the right fit for us. I want to talk about right fit. So


have that meeting, and you say to the potential client, did you maintain all of your documents, what’s your document retention policy? And sometimes they’ll say, well, we don’t destroy them, keep everything where we’ve got a seven year document retention policy, or we have no policy we just throw everything away. So what happens is, is that if documents or data more to the point is not preserved, and you end up going to try, the judge will


Not just the lawyer, but the judge will read to the jury an instruction that says they didn’t maintain the data. And because they did not maintain it, you can presume they did it because it wasn’t going to help them, that it was bad for them. And that’s a terrible instruction, especially when it’s your client, the instructions. Right. So it’s very important that you, as soon as you even think that you might be sued, if you have a lawyer on retainer, contact them and say, Hey,


this particular job didn’t go as well as we thought it did. And, you know, is there anything that we need to do? I think you’re right, absolutely. Because, you know, um, anything can happen to anybody at any time, even if you’re just a sole proprietor like me, because you never know, when somebody else you know, doesn’t have to be just did business with somebody or what have you and somebody else might come to you and do something and


You got to document everything right now. And, and he’s saying in every aspect, whether it’s your text, email, what have you. You also talked a little bit about how you wanted to talk about the right fit. And let’s talk a bit about what that is. So, one of the things that we pride ourselves on at FR Law Group is that we’re a very small shop. We have four lawyers. We do not advertise ourselves as being experts in everything.


We specialize in insurance, and in construction. And if you have an issue related to one of those two subjects, we will be the right people for you because we know the industry. We listen to our clients, we participate in both industries and associations. And so if you came to me with some type of I need a tax bond, I wouldn’t know even where to begin. And I would tell you, you do not want to come to our shop for a textbook. Right.


But if you have an insurance or construction claim, we are, we are right there for you. Give an example of an insurance claim construction kind of say like an insurance claim with a small business. With a small business, so I have one that we wrapped up relatively recently, where the client had a waterline rupture. And it was a fairly small warehouse here in the valley. And as a result of the waterline rupture, a huge slab came up, concrete slab, and they needed to go back and backfill it and do more work on it. And that was about $110,000.


The insurance so they contacted me and said, We have insurance for this and I said well, let me see what you have. And they did have property insurance that covered it. The insurance company, paid for most of it and then started pushing back on exclusion


Very familiar with that policy.


I contacted the insurance carrier in writing and said, I think if you look at the factual situation here versus your exclusion, think you’ll see where it really is not applicable to this loss, and sign a case log, eventually, actually pretty quickly was able to get the carrier to see to the request, and the client is fully compensated for the loss. And I mean, that happens all the time. Right? I was gonna say, you know, that, that, obviously, if something happens like that in your business, you’ve got to make sure that you’re, they read the policy, because it’s all about the policy, right? I’m also thinking about and right now with COVID. And I know we’ve talked about this once before, but I want to bring it up again, because, you know, there are so many businesses out there that did get affected by COVID. Right. And can you help in there and sure, like, you know, let’s say they’re a restaurant and they can, they haven’t been able to, you know, reclaim their business back.


Yeah, this is about a six hour radio program.


So, In real short terms, almost every business has a property policy and the property policy, among other things provides insurance for direct physical loss or damage to property. And those, those are the key words. So if you have, you can make a claim for physical or direct physical loss or damage to your property. Part of your coverage is the business income interruption.


There’s a world of fight going on in the courts right now and amongst the insurers and the policyholders and the insurance brokers as to why does that really mean. There is also a virus exclusion that you have to deal with, but each policy kind of stands on its own that we missed


This earlier, insurance policy is nothing more, nothing less than a written contract. So the contract terms guide to how you should follow the contract. A lot of the policies have endorsements. Not all policies have the same endorsements. So it’s not one size fits the same. So each individual client has reviewed their individual policy and see, do they have the coverage for this? What are the exclusions and what endorsements do they have that might override the exclusion? Or might tack on further? Well, you can call them directly and they’ll do a free consultation with you because that’s really what it’s all about, is having that conversation with you first off to see, you know, do they have a claim in the first place, right? Whether or not it’s a big one, like you just mentioned, where you know you have water damage or what have you, but also to something small, so it isn’t small. It’s not small to that personally.


And as I’ve mentioned before, and I am passionate about representing policyholders, but not all losses are covered. And so, you know, one of the things that we pride ourselves on is if we feel that it’s not covered, I’ll tell you, if I think it’s questionable, and you’re going to end up having a dogfight on your hands, we tell you that too, because again,


clients don’t like surprises, right? No, nobody would. But I love the way that you work, but you want to make sure that they understand step by step, what they’re getting into, you know, what could happen? And at the end, hopefully what that, that is going to be. Right. Yes. And I love that about you. Okay, so now they work nationwide. Their website is They do free consultations. They’re rated with the Better Business Bureau, 31 years of experience, and that’s what you bring to the smaller person to not just the big people, but the small guys out there that need that representation.


Their phone number to call directly is 6025667425, what would be your final words for today?


If you think that if you get involved in a piece of litigation and you think it’s going to be easy or quick, that’s not reality. So you need a reality check. And make sure that whoever you hire to assist you in terms of the law firm, that they know your business and that you and the lawyer have a clear and transparent communication as to expectations. Yeah, that connection fit the right fit. It’s really important to understand what everything is. Also I want to remind everybody to if you are dealing with anything right now and you see that fire happening, you know, because we all know when you get that email if somebody’s upset with you or you’re sad, something, keep everything. Make sure that you keep everything because in the long run it as hard as it is


It’ll make that just a little bit easier for everybody involved. You can call them direct their phone number 602-566-7425, it’s