Litigation Best Practices—Lessons from Risk Manager of the Year
August 2008
Ah, summertime—when a young person's fancy
turns to … best practices in litigation management. Really? Well, maybe that's
not exactly how the saying goes.
by Kevin M. Quinley,
edited by Michael Boutot
Council on Litigation
Management
Springtime of each year reveals to us the identity of
Business Insurance's annual "Risk Manager
of the Year," an award conferred at the annual RIMS Conference, this year held
in lovely San Diego. The announcement and its subsequent coverage in
BI also gives us a sneak peek at best
practices in a number of realms. One of those is litigation management.
Scott Beckman, Risk Manager of Advocate Health Care Network, is this year's
recipient of the "Risk Manager of the Year" award. A profile of his Chicago-area
operation (Business Insurance, 4/28/08)
reveals some interesting facets of an innovative litigation management program.
These may offer an inside glimpse at best practices for you or your organization
to consider.
Six Key Yardsticks
For starters, Advocate's risk management department has developed written
guidelines for outside counsel. Okay, this by itself is not so groundbreaking.
These guidelines, however, include six yardsticks by which outside law firms
are judged:
- Communication
- Management
- Timely responses to information requests
- Competency
- Billing practices
- Compliance with operations guidelines
Advocate does not weigh these categories evenly. The Big Three C's are: Communication,
Competency, and Guideline Compliance. These carry the most heft.
Communication
Communication from outside counsel is key. The best outside counsel epitomize
the old Holiday Inn ad tag-line, "No surprises." Litigation management is a
dynamic setting, with circumstances constantly changing. New facts come to light—some
helpful to your case, others detrimental. A defense expert craters under withering
deposition questioning. A bad document comes to light that nukes your defense.
The plaintiff and her attorney have a falling out and she fires her counsel.
The judge rules that a key expert's opinions are limited in an unexpected way.
To paraphrase a popular bumper sticker, "Stuff Happens" in managing litigation.
Sometimes it's good stuff; sometimes it's bad stuff. Bad stuff is not necessarily
your counsel's fault, but suppressing or delaying communication of it may be.
Competency
Competency is a bedrock requirement for outside counsel. At the hiring stage—if
not before—the litigation manager must verify that the chosen counsel has deep
expertise in the area of law that the case involves. This includes the number
of prior similar cases, references in that field, having written articles or
speeches in that niche, whether it be trucking accidents, insurance agent errors
and omissions (E&O), or slip-and-fall claims.
The judging process doesn't end there, though, in assessing outside counsel.
Advocate goes a step further by giving each law firm an overall score, putting
it in a chart, and tracking performance for all 12 of its outside firms. It
shares this chart with those firms.
There is little use in going to the trouble of rating firms unless the litigation
manager shares those results with the lawyers being assessed. Of course, this
is no problem when the report card is favorable. It is awkward, tough, when
the results are sub-par.
No one enjoys giving critical feedback. For many clients—whether insurers
or self-insureds—it is easier to quietly transition case referrals to another
firm and "drop" the incumbent without the latter ever being aware of its de
facto "firing." This may not be best practice, however. Holding firms accountable
by sharing (constructively) critical feedback and perceptions is an awkward
but occasionally necessary aspect of litigation management. How else can they
hope to improve?
If a firm takes the feedback in stride and promises to improve, perhaps you
can get by with simply firing up outside counsel in lieu of just firing them.
If the firm blows off the feedback, that speaks volumes and clears the way for
the litigation manager to find alternate firms for future assignments. How a
firm responds to critical feedback can be the fork in the road that tells you
whether the relationship is salvageable or not.
Compliance
The third C is compliance—guideline compliance. At the courtship stage, virtually
all lawyers and firms will assure you that your guidelines pose no trouble.
In practice, real assignments often expose these assurances as empty promises.
Firms that do not comply with your litigation guidelines are on thin ice. At
the interview and selection stage, share your guidelines with prospective counsel.
A threshold issue is whether or not the attorney or firm will commit, preferably
in writing, to adhering to such guidelines. Getting buy-in up front can avert
haggling down the road. If the firm cannot commit to guideline compliance, that
does not make them a bad firm—or attorney—just not a good match for you.
Five Takeaways for Better Litigation Management
This feedback mechanism to outside counsel creates its own Hawthorne Effect,
where lawyer awareness of these metrics has had a positive impact on service
and outcomes. Five take-aways for litigation managers (those who have this responsibility,
regardless of one's job title) include:
- Decide what you think is important
in evaluating outside counsel
- Periodically grade outside counsel according to these criteria
- Track and graph trends
- Share this data periodically with counsel
- Don't be afraid of blending hard data (e.g., average billings per case)
with "softer" subjective data (e.g., competence within a certain area of
law)
Conclusion
Not everyone can be Risk Manager of the Year. (In fact, not all of us could
make it to San Diego to attend RIMS!) All of us, though, involved in litigation
management can ponder the approaches used by Advocate and consider adapting
to our own operations to improve litigation management processes and outcomes!
Kevin Quinley
is vice president, Advisory Board for the Council on Litigation Management
http://www.litmgmt.org.
He lives in Fairfax, Virginia. He is the author of
Litigation Management, published
by IRMI and available at www.IRMI.com.
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