Almost everyone who appears in a commercial mediation I conduct thinks they are going to win their lawsuit — if they are among the 1.5% or so of cases that actually make it to trial. People understandably get caught up in the emotion of their case. Humans generally make poor decisions when guided by high emotions. That is one reason why litigants hire lawyers, who are disconnected from the emotional aspects of the case and can give clients solid advice.
When I tell litigants that they are unlikely to feel the heights of euphoria should they win at trial, they often look at me in disbelief.
In May 2017, a jury in Orange County, California awarded a verdict of $256 million to Mike Kahn. Kahn had owned Superior Automotive Group (SAC), an automotive dealership group consisting of four Nissan dealers, two Toyota dealers and a Jeep-Dodge-Chrysler dealership in the Los Angeles and San Francisco areas. In 2009, Nissan Motor Acceptance Corporation (NMAC, the financing arm of Nissan) sued SAC to recover some $30-40 million in loans made to SAC. Auto manufacturers often finance dealer’s inventory and capital improvements. SAC countersued, claiming that although they were delinquent on 30-40 vehicles that NMAC assured SAC of continued financing. Ultimately, Kahn’s SAC went under.
After 8 years of machinations in court, a jury ultimately found in Kahn’s favor, awarding him a judgment for $121.9 million in compensatory damages and $134.5 million in punitive damages.
Here’s what Kahn told Automotive News:
“I still lost. Nissan won, not me. They shut me down. And I’m still out of business.
“The jury agreed that I deserve to be compensated for fraud. But that doesn’t give me back the eight years I spent fighting for my reputation and my name.
“I had a net worth of $100 million at that time. Where would I be today if none of this had happened? Maybe I could have tripled that by now, as others in the business did.
“But I can’t make up that lost time.”
Nissan vows to appeal. They previously won a prior version of this lawsuit.
Settling has many advantages. This case has been in the courts for 8 years and is not finished. Even with a “big win,” Mr. Kahn is still not happy.
Contact me if you are involved in a lawsuit and would rather settle it on your own terms.