Yesterday, the American College of Trial Lawyers and the Institute for the Advancement of the American Legal released a report entitled “Interim Report on Problems Associated with Discovery”. Discovery is the pre-trial process where each side engaged in litigation gives and receives information about the case. This information can include written questions (interrogatories), production (transfer) of documents and other evidence, as well as deposing (interviewing under oath) various witnesses, experts and litigants. The purpose of discovery is to allow each side to assess how good a case they have (or not) and is guided by rules of court and evidence.
Discovery can be costly and disruptive. Imagine having to produce records for the other side (under subpoena and other rules of court) that might be extensive, hundreds of bankers boxes. Or having to spend days away from work in a deposition. So one can imagine that using this “cost” against the other side becomes a bit of leverage to be used. The study bears that out.
Nearly 1500 highly experienced lawyers (on a remarkable 42% return rate) answered the survey. Some of the findings:
- The civil justice system is in serious need of repair; it takes too long and costs too much. Deserving cases are not brought because the cost of pursuing them fails a rational cost-benefit test, while meritless cases, especially smaller cases, are being settled rather than being tried because it costs too much to litigate them.
- The discovery system is broken. Discovery costs far too much and has become an end in itself. One respondent noted: “The discovery rules in particular are impractical in that they promote full discovery as a value above almost everything else.”
- Electronic discovery (i.e. emails and other electronically stored datam which can be voluminous), in particular, needs a serious overhaul. It is described time and time again as a “morass.” Concerning electronic discovery, one respondent stated, “The new rules are a nightmare. The bigger the case, the more the abuse and the bigger the nightmare.”
- Local Rules (rules that are used by a single court or vicinage) are described as “traps for the unwary” and many think they should either be abolished entirely or made uniform.
- Nearly half of the respondents said that notice pleading (seeking judgment on the case without trial) has become a problem because extensive discovery is required to narrow the claims and defenses and 57 percent said that with notice pleading, motions to dismiss on the pleadings are not effective in limiting claims and narrowing litigation issues.
- More than 76 percent said that answers to complaints likewise do not accomplish the goal of narrowing issues. This suggests that a further look at notice pleading may be in order.
- Only 34 percent of the respondents thought that early discovery disclosure (rules intended to reduce discovery) reduces discovery and only 28 percent said that it lowered litigation costs.
- Ninety-two percent said that the longer a case goes on, the more it costs (this seems like a silly question to ask…what did the other 8% think, it gets cheaper) and 85 percent thought that litigation in general and discovery in particular are too expensive.
- Sixty-four percent said that the economic models of many law firms encourage more discovery than is necessary.
- Expert witness fees are a significant cost factor driving litigants to settle, ranking just slightly behind trial costs and attorneys fees in that respect.
- Forty-five percent believe that there is discovery abuse in almost every case (almost equal in amount between plaintiff and defense counsels)
- The survey respondents especially like judges to require ADR (55 percent said it has been a positive development in managing cases) and more than half thought arbitration is less expensive and faster than civil litigation.
- Fifty-three percent said that the cumulative effect of discovery-rule changes since 1976 has not reduced discovery abuse.
- 87 percent agree that electronic discovery is too costly, and 76 percent agree that electronic discovery issues are not well understood by judges.
- Nearly 86% of respondents say discovery sanctions are seldom imposed
- Nearly 71% believe counsel use discovery as a tool to force settlement
- 56% said that the time required to complete discovery is the primary cause of delay in the litigation process, and another 20% of respondents cited the primary cause of delay as attorney requests for extensions of time and continuances.
- 87% said discovery is too expensive and 85% said litigation is also too expensive
- Nearly 81% report that their firms turn away cases when it is not cost-effective to handle them
- 83% of respondents believed that litigation costs drive cases to settle that should not settle on the merits
- Over 94% believed trial costs are an important factor in driving cases to settle, and a nearly equal number believe the same about attorney fees
- Nearly 73% of respondents report that one-fourth or fewer of their cases are processed through ADR.
- Over 82% view cases settling without trial due to court-ordered ADR as a positive development.
Overall, the report is a pretty stinging indictment of the civil justice system.
One of the criticisms of mediation is that it is “cheap discovery”. What is so wrong with finding out early on what the other side has? Mediation serves a useful purpose in getting the issues on the table early and effectively. I’ve held mediations where attorneys learn new things from their clients (that were critical to their case). I’ve had others where attorneys can quickly see how poor a witness their client will make. New information presented in the mediation can change valuations of a case. I encourage informal information exchange between the parties prior to mediation.
Simply put, mediation is a major part of the cure for the ills of discovery and of civil justice. If you’re interested in saving time and money on your dispute, litigation or divorce, please feel free to contact me to discuss things further.
Knowing e-discovery is inevitable, I argue an enterprise can use technology proactively to make its e-records more benign. It can broadcast intent to be lawful and a request that adversaries come forward as early as possible. What do you think? –Ben