As product liability lawsuits continue to cut into slim margins of profit in recession based sales, many companies are looking for a solution. Repeated lawsuits, even those without merit, are frequently rewarded by settlements that encourage rather than discourage further litigation. Counsel for injured plaintiffs are well connected, effectively allowing them to spread news of settlements and judgments against particular companies, encourage other lawsuits, and share strengths and weaknesses of any case. Defending these lawsuits, even frivolous ones, drain important resources, requiring efforts in responding to discovery, ensuring consistency across lawsuits, and mandating repeated training of defense attorneys who are frequently unfamiliar with the both the products and the industry.
In an effort to avoid the pitfalls that result from product liability lawsuits, there is a growing trend throughout the United States for companies to hire national trial counsel to represent all product liability suits, regardless of jurisdictions. Aided by the allowance of case specific admissions allowing out of state counsel to defend product liability suits in each state, these companies have reaped the benefits of a consistent and orchestrated defense provided by attorneys experienced and specialized in a given field. By hiring attorneys to handle all such litigation, these companies foster a long standing and mutually beneficial relationship aimed at not only discouraging future lawsuits, but also in reducing costs.
The companies selecting national counsel have quickly learned the benefits of such a relationship. Not only do such programs provide a place to turn when legal questions arise, but they also provide company management with the peace of mind governed by trust that arises only through long term relationships. These programs additionally help to alleviate drains on company resources since the need for repeated training is reduced or eliminated. The programs also provide great benefits in the defense of cases. Knowledgeable attorneys handling claims from the onset, provide manufacturers significant advantages in early stages of litigation because the defense counsel know the products and issue and can cut off many avenues of recovery. In addition, the relationship ensures consistent responses to discovery nationwide, preventing sanctions from well connected plaintiff counsel who claim that the manufacturers have provided different answers to discovery in different jurisdictions.
National counsel can also discourage future claims. Plaintiffs’ counsel are less likely to file suits against counsel when they understand that they will face experienced trial counsel who will not hesitate to try the case, will reduce recovery, and will require heavy investment by the counsel themselves. Lower settlements and judgments, which usually coincide with national representation, also reduces the incentive to file or pursue claims.
Although some wonder at the costs, experience shows that long terms costs actually decrease. Experienced counsel generally spend less time in learning the product and industry, and less time in the promulgation of discovery materials. Experienced attorneys usually help to reduce drains on company resources, freeing time for more beneficial activities such as product development and sales. Experienced attorneys may also help to lower values of cases, and reduce overall settlement and judgment figures.
Although these programs were once used only by the largest companies, they are no longer limited to large, multi-national corporations. Smaller companies have found avenues for using the programs. These companies, which frequently rely upon insurance companies for protection, are usually able to negotiate claims control, or obtain self insured retentions that provide the ability to choose counsel. In some cases, insurance premiums are actually reduced due to the existence of a reliable and coordinated defense. Further, attorneys are generally agreeable to tailoring programs to meet the specific needs of any given company.
As the information becomes more readily available through the continued growth of computerized, internet and wireless based growth in the legal profession, the use of national counsel programs may be the right solution for any company.