The Costs of Litigation
I’m here to talk to you about the cost of litigation and the decision to settle a case or take a case of trial. Now as an attorney and every attorney has heard this, you hear it sometimes, they say it's about the principle and in the real-world principle costs money. Anytime a client usually comes in my office, they've been usually wronged in some way and you want the other side to pay and restore you to where you were prior to the wrong. But in making this decision you have to decide how much that will actually cost you because you want the other side to pay, but you're going to have to also pay. That's why we're going to go through it today.
The old saying for attorneys is, be careful of a client that comes in and says, "I don't care how much it costs", because that client never had any intention of paying you in the first place. The truth is most people don't have the funds to litigate a case 100% or to the death. I like to use an example here to explain to you something. You know, there's the famous Hulk Hogan vs. Gawker lawsuit which was an invasion of privacy lawsuit. Which eventually lead to Gawker’s demise. Gawker was a website that essentially published tabloid type information from the private lives of public people.
What people might not know is that lawsuit was actually secretly funded by PayPal billionaire Peter Thiel. Now Peter Thiel hated Gawker because he saw them as a website that ruins people’s lives for no good reason. They had published unflattering stories about him, so he secretly funded a team of lawyers to find and help victims of Gawker's coverage of them to mount cases against Gawker. Now most people don't have a Peter Thiel so therefore the settlement of the lawsuit might be in their best interest. The timing of that settlement is going to depend on various factors.
I just made up a little list here regarding the cost of litigation, some expenses that you're going to see here:
- Filing fees - it could range from $45 in Justice of the Peace Court to $400 filing fee in U.S. District Court.
- Request of records - a lot of times you are going to need to order medical records or other records. Sometime that goes about 50 cents a page but that's going to vary.
- The cost of depositions - that's when you ask questions to the other side or they ask questions of your party under oath with the court reporter. Sometimes it's recorded audio or visual, that's going to run from $200 to $900 each.
- Expert fees - in some cases where there's going to be some kind of allegation of negligence, you're going to have to have an expert. Or a lot of times in personal injury cases I find that it is about $3000 review the actual case, $3000 to write an expert report and it could be $8500 for trial testimonial. That is just an example of a recent case I had where that was the listing of this doctors fee agreement.
- Private Investigation - If you need a private investigator to sometimes interview people, sometimes to serve people or sometimes to look up information that could cost you $75 an hour.
- Attorney Fees - I find in this area a new attorney is going to be $250 an hour, a more experienced attorney can go up to $500 an hour in Delaware. Sometimes cases can be higher. Those are real cost, who pays for these costs? Almost anytime the client is going to pay the cost. Meaning it didn’t matter if it's going to be a contingency fee or an hourly fee. Contingency fee is win are you don't pay that attorney until the very end. They don't get paid until there's a settlement or there's a there some kind of trial and judgment versus hourly fee were paying hourly but the client almost always pays the costs. Where in some cases an attorney may advance the cost, meaning paying them up front and you pay him later on. Or in some cases the client pays the cost as they come in.
So, these are costs that are going to come out of you. Obviously, the earlier you settle the case, or resolve the case, the less costs there are going to be. You have to talk to your attorney about how much would the cost be for this case and will you end up getting less because of all the costs you paid in a case if it goes forward. There is also consideration for settlement because of cost of time versus any uncertainty when you go to trial. No matter what court you are in, whether it's Justice of the Peace Court, Family Court, Chancery Court, you're rolling the dice if you let a judge decide. Meaning that you're taking it out the hands of the two parties. Where if you settle a case, you're not going to get everything you want, but you're going to get something versus the uncertainty of letting a judge make a decision or a jury make a decision.
Ronald Reagan once said, “I rather get 80% of what I want rather than go over the cliff with my flag flying.” If somehow in settlement you're getting a lot of what you want, I would recommend that client accept the settlement rather than taking a risk further on an having more court cost to come forward with attorney’s fees. I had a recent Family Court case where I fully expected this case to go to a hearing. We had prepared to go to a hearing and I was prepared to go to the hearing. We had cost of depositions, we had other various costs, I'd put a lot of time in and the case got settled right before trial. The reason why it got settled is because my client got 80% of what they wanted. So yeah, they could've taken a risk and go to trial and got more perhaps, or they could get the risk of taking less. So, I recommended in that case for that person to take the 80% and not take the risk. I always say the best way to get a good settlement is litigate the case like it's going to trial. It's best to be prepared to go to trial and settle the case then just trying to settle a case and not being prepared to go to trial. I think that's the worst position you could be in.
This is Ron Poliquin, DoverLawOffice.com. You have an obligation to yourself to know your rights and your options to make the best decision for you. I don't decide for my client to go to trial or settle, they make this decision themselves based on the best information I have and the options they have. Thank you!
Give me a call today if you'd like to discuss your case.