Denver Bar Association
October 1999
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Outlandish Lawsuits

by Dennis Walker

Early this year, our Chief Justice delivered the State of the Judiciary. She described the need for more judges, better pay, more support staff and other ways to improve a burdened system, such as accommodating litigants and jurors. The next day the Denver Post carried a photograph, which captured expressions of several elected officials near the Chief Justice. Their faces revealed bemused impatience.

A few weeks earlier, the Assembly heard our new Governor urge action against "outlandish" lawsuits. He complained of litigious elements in our society. His remarks did not call for more resources.

Lawyers know outlandish lawsuits. What makes claims outlandish will vary, but one thing remains constant. Such claims usually originate from the opposition. I will offer an illustration.

A large business gets sued for wrongful discharge and sexual harassment. The plaintiff worked as office staff in middle management. She accuses her boss of assaulting her. The company’s reputation is placed at risk. She claims emotional distress and the aggravation of depression. Her charge mentions sexual innuendo, unwelcome touching and humiliation. She says she was so intimidated that she has temporarily lost the ability to function in the workplace. Post-traumatic stress disorder appears later on a psychological report.

Current management did not hear about such conduct. The manager and co-workers are questioned. The employer does not see anything particularly incriminating. There were no formal complaints during the 18 months. This misconduct is alleged to have persisted. HR suspects the plaintiff has fabricated her charges due to her bitter disappointment at being terminated. Her performance was "inconsistent" at the end. While the workplace atmosphere was somewhat "adult" oriented, with teasing, gossip and vulgar jokes, current personnel cannot fathom that she was singled out for different treatment by her boss.

The charges must be defended. Two law firms become involved since allegations of negligent supervision trigger a question about liability coverage. The carrier expresses its "reservation of rights" because intentional conduct is involved. Officers wince over the litigation budget. Filing motions and an answer alone will cost $5,000. $20,000 is expected through disclosure and discovery. If trial is necessary, over $50,000 is likely.

Initially it doesn’t seem necessary for the manager to have separate counsel. He must be advised that his position is distinct, so the possibility of the expense of personal counsel looms.

The insurance company suggests getting rid of the lawsuit for less than the fees to be paid during the first phase. Management is shocked. "Why do we have to pay blackmail? She hasn’t worked for a year. She’s probably not paying her lawyer. He must be doing this on a contingency. How can lawyers take cases like this?"

The defense brainstorms on dismissal motions. The court jurisdiction is challenged because of the exclusive remedy of workers’ compensation. Also, because a civil rights claim is included, deficiencies are found in the administrative hurdles prior to suit. Perhaps the judge will sense from Rule 12 motions that the merits do not likely favor the plaintiff.

Solutions are sought in a strategy of attrition. With dismissals, courts may help avoid such litigation and allow time for other cases. If one portion of "these cases" is disposed of based on credible dismissal motions, the numbers quickly add up. Another portion of these cases could be cut with partial dismissals. Many are dispose of on summary judgment motions. Perhaps the employee failed to exhaust an employer’s remedial grievance procedure. Maybe there was a lack of substantial job detriment. If summary judgments are entered, only a few dismissed plaintiffs will push an appeal. Contingency fee counsel may tell them to drop out.

In this fashion, many such cases might be eliminated and the rest can be significantly trimmed back. Plaintiffs may give up due to the time and expense of proceeding. Some accept nominal settlements. Attrition may prove effective. Maybe only a few dismissals will be reversed because a court feels the facts deserve to be heard by a jury. Such a strategy of attrition has appeared in many cases lately.

Meanwhile, assume the harassment "victim" in my illustration chooses to persevere. She withstands the court’s trimming of claims. She endures depositions and document production. Her counsel has initially absorbed expenses. Can she take the emotional pain of revisiting tormenting events?

Later, in a spontaneous moment of commiseration, a former co-worker meets the plaintiff for lunch. They discover shared experiences about the manager. This later leads to fruitful questioning at the manager’s deposition. A pattern of conduct, not entirely consistent with the denials of months earlier, now unfolds.

The defense shifts. Now they say the plaintiff was hypersensitive to casual and ordinarily-accepted behavior. Perhaps there was consent. Where were the real complaints?

The plaintiff counters with the severe effect of humiliation and shame. Management asserts she didn’t go through "official" channels. She observes that this would have put her in a room with the manager. How could she face him and return to work under his supervision?

Then the manager confides in a colleague. He does not think his conduct was offensive. He opens up about his "exploits" with a male co-worker who seems sympathetic. The co-worker turns out to be sympathetic with the plaintiff because his wife had similar experiences.

The plaintiff hopes her doubters will be believers. If another employee accepts her story the nightmare of disbelief may fade.

Her discovery requests yield the name of the sympathetic co-worker. His deposition makes the employer start to face an ugly reality. However, summary judgment motions are pending. The court may still be favorably inclined toward dismissal. These are private matters and why should the court get involved? The issue becomes whether courts will get behind techniques to achieve "attrition" to defeat outlandish cases. Perhaps a historical perspective will help.

Every generation witnesses outcries over litigation. Weapons have been developed. Those wrongfully sued counter with claims of malicious prosecution and abuse of process. An exception to the rule, saying that each side should bear its own expenses, was developed for bad faith and obdurate litigation.

Rule 11 was adopted and expanded to allow more sanctions. Statutes and rules were passed to punish those advancing frivolous, groundless, or vexatious positions. New hurdles were placed in our rules to weed out the plaintiffs who are not financially able to proceed. Recently, mandatory attorney’s fees were allowed for defendants in the event of the dismissal of "tort" actions under rule 12(b). Are enough plaintiffs being scared away?

Can it be that we want courts involved, proactively, in a strategy of attrition with more dismissals? Wouldn’t that tilt the level of the adversary system? It is, of course, always the other party’s outlandish position which interferes with our client’s potential for justice.

In the illustration offered, assume the evidence shows the plaintiff did suffer wrongfully. Why should it take legal services valued in the range of $30,000-$60,000 to achieve some resolution where damages might be $50,000-$100,000? From the defendant’s perspective, there shouldn’t be a payout if there is no claim in the first place.

If courts make it more burdensome to resolve matters, this pre-judges people and their claims. Based on exceptions and occasional aberrations, should we load our system with more financial traps and hurdles? That would lead to more disrespect by all participants.

Trials help us because trials focus on the search for truth. Determining that "these" people should not be asserting "these" claims blindfolds us from the truth.



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