Complex business litigation — not just for big firms

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Handling complex business litigation can be difficult — especially for lawyers at small firms. This does not mean that only large firms should take these cases. While complex business litigation can be challenging, the hurdles to taking such cases can be overcome.

Several local attorneys skilled in complex business litigation recently offered practitioners advice about how to handle such cases at a continuing legal education seminar sponsored by the Minnesota Institute of Legal Education.

Smaller firms can and do handle complex business litigation suits just as effectively as larger firms, according to Minneapolis attorney Barbara Podlucky Berens, one of the presenters at the CLE.

Berens, who works at a 12-attorney firm, observed that it is sometimes necessary to utilize outside reviewers or contractors when it comes to document inspection, but with the advent of the Internet and the current ease of communication, it is now much easier for small-firm practitioners to take on complex cases.

LaVern A. Pritchard — a Minneapolis solo practitioner — maintained that small firms can be successful handling complex business litigation matters “if they use the proper technology and explicitly focus on litigation as knowledge management.”

Pritchard said that technology has eliminated any relationship between the size of a firm and the sophistication with which it can provide its services. “You can substitute good techniques and good technology for people,” Pritchard said.

Litigation types

Practitioners said that cases are labeled “complex” for a variety of reasons, including:

• their subject matter,

• the number of claims asserted,

• the number of parties or attorneys involved, and

• the amount of damages concerned.

Complex business litigation encompasses areas such as antitrust and securities litigation, large class action lawsuits and intellectual property matters such as trademark infringement, according to Berens.

Minneapolis attorney Robert P. Thavis, who was also a presenter at the seminar, said that the term indicates a “fairly high level of litigation” either between business competitors or between a company and a group of customers, consumers or shareholders.

“These sorts of cases tend to call into question how a company is managed,” Thavis explained. Such cases often consist of challenges to management decisions and questions over whether management is running the company properly, he said.

Complex business litigation differs from other types of litigation in a variety of ways.

Thavis said the difference is primarily in the “size and magnitude of what’s at stake.” It is not unusual in these types of cases to have teams of attorneys, reams of documents and cases that last five years or more, he observed.

Because complex cases often involve high-priced experts and millions of pages of documents that must be reviewed, analyzed and summarized, these cases tend to be much costlier than other types of litigation, according to Thavis.

Berens observed that complex cases are normally more time-consuming than other types of litigation because they often involve multiple parties and lawyers, numerous witnesses, lots of documents and various types of electronic evidence.

Berens noted that a recent law review article estimated that one-third of all business or technical data exists in electronic form right now and that percentage is expected to increase. Therefore, attorneys who practice in the complex business litigation arena must begin thinking about how to manage electronic data, she said.

According to Berens, attorneys are grappling with electronic-evidence-related questions, including:

• whether to ask for it,

• how to ask for it,

• whether it is relevant, and

• whether it is worth the cost of retrieving.

Documents produced in electronic format are important because they often provide a great deal more information than documents produced in paper form, Berens said, noting that an electronic file may reveal who created the document, who edited it and who received it. Electronic files may also make it possible to obtain drafts of the documents, which is almost impossible to do when receiving only paper copies, she stated.

Setting a strategy

For lawyers interested in practicing in the complex business litigation arena, or who have recently taken on such cases, attorneys experienced in the area offered some advice.

“Setting a strategy in the beginning of the case is essential,” Thavis said. He also advised attorneys to formulate a plan to obtain and handle documents so that they are not overrun by them.

Thavis said attorneys should stay focused and not get trapped in side battles, like discovery disputes. These disputes “divert attention from the main focus of the litigation,” he said.

Berens said that it is important to ascertain what your clients really want and then determine if their expectations are realistic. She said that it is often necessary to provide the client with some perspective and sometimes even serve as a sounding board.

Berens also recommended evaluating the strengths and weaknesses of a case early on, specifically advising attorneys to “do [their] homework.” She suggested talking to key witnesses, formulating a chronology of the events that took place and determining what really happened before delving headfirst into the discovery process. She views it as her job to “tell the client if it is not a strong case.”

Expert witnesses

The use of experts is an extremely important issue in complex business litigation, according to practitioners.

Minneapolis attorney Jeffrey D. Hedlund, who has extensive experience in securities litigation, observed that it is very common to have several expert witnesses on both sides of a complex business litigation matter.

“The plaintiff will present an expert to calculate its loss, and the defendant will present a rival expert to show why the plaintiff’s expert is wrong,” Hedlund explained.

Both sides typically present experts on the issue of liability as well, who specifically testify as to what a “reasonable professional” should do under the specific circumstances of the case, Hedlund noted.

Hedlund told Minnesota Lawyer that over the past eight years or so, courts have been implementing new standards regarding the admissibility of expert testimony, requiring attorneys to satisfactorily demonstrate that the experts’ testimony is reliable enough to present to a jury.

Hedlund advised attorneys to think about experts early on in the case, especially consulting experts. He believes that talking with consulting experts, as opposed to testifying experts, is helpful in assisting attorneys with understanding the various technical principles applicable to the litigation at hand.

Resolving the case

Since the costs involved in complex business litigation matters can be staggering, settlement can be a very attractive option.

Berens’ philosophy is that “with complex business litiga
tion, you are looking for a business solution.” She added that in some cases the parties have to continue in a business relationship, so the goal is to “try to get the parties to reach a business resolution that makes sense.”

For those complex business litigation cases that do not settle and wind up in trial, there are a variety of techniques attorneys may employ to assist the jury in understanding the issues involved and delivering an informed verdict, according to practitioners.

Thavis acknowledged that it can be difficult for a jury to fully understand all the issues involved in a complex business litigation suit. Juries do their best, Thavis said, “but it is up to the attorney to help them understand.” The attorney must prioritize the points to be made and then streamline and simplify the case for the jury, he explained.

Thavis suggested using visual aids at trial — either computer generated or computer enhanced — and introducing summary documents in lieu of the hoards of papers that are likely to be produced during discovery.

If any of the witnesses will not be available to testify at trial, Thavis suggested videotaping the testimony beforehand and replaying it for the jury rather than simply introducing a written transcript. Another alternative is to use actors to read the witnesses’ answers into the record, he said.

Hedlund cautioned lawyers to present the case in an “appealing and understandable way.”

He also recommended adopting a simple theme and sticking with it throughout the trial.

“Craft your opening and closing arguments, as well as your witness and expert testimony, around that theme,” he said.