By Don Keenan
How often have you found yourself having worked like a dog on getting a case to the steroid level, and then your client pulls the rug out from under you and wants to take a lowball offer?
We've all been there, so let me give you a couple of suggestions on how to empower your client:
- Remind them of their early words.
During the early meetings, when you ask your clients, “What do you really want?” virtually all of them will tell you, “All I want is to make sure this doesn’t happen to anyone else.” The majority of my clients have told me that verbatim, and it’s very Reptilian. It’s very honest and it’s the truth.
So as clearly as you can remind them of those early words, you want to tell them that if they accept the lowball offer not only will they not prevent this from happening again, they will encourage it because the forces of evil will know they got a pass in your client’s case; therefore, it will be destined to happen again (and again).
- Do a value-focused focus group.
I’ve said many times: Focus groups are wildly unreliable in predicting what the verdict will be. We rarely ask a focus group to give us a verdict number because, quite frankly, they know it's not real; it’s play money. They’ll usually offer up a sky high number and it’s of no value to how the case will play out in real life.
However, in the last couple years we’ve started approaching this in a different way. After the case is fully vetted by the focus group (and they think their job is done), we then ask them, “I want to tell you that the defendants have offered $[x amount] to settle the case. Would you advise the plaintiffs to take this amount?”
This question produces a real-time reality. The focus group knows their words will have an effect; therefore, their answer is far more reliable than what the actual verdict amount should be. In fact, in cases where we've asked for the verdict (and it’s sky high), when we then ask if they’d advise the plaintiff to take a settlement, the numbers shift dramatically. We've had verdict amounts in the $25,000+ category. Yet, when we ask whether the clients should take $5 million, the response is, “Take it and run.”
Now I'm sure this method can work as effectively in a lower case, so test it out. In fact, use the lowball offer with the focus group and you're probably going to get most folks (if it's truly lowball), say the plaintiff shouldn’t take it.
We videotape all our focus groups and with these types of focus groups, we simply show the end of it to the client so they can hear from the group that the consensus is not to take the lowball offer. You can try twisting the arm of your client all you want (which I do not recommend), but when they see average folks just like them sitting in a focus group telling them to turn it down, that has a big effect.
- Show the client the profit of the defendant.
In many cases, the Internet will provide ample information for this. Find out if the CEO makes $10 million a year, and see if the corporation has a box at every sporting event of the year. Perhaps the company’s annual advertising budget is 100 times greater than what they're offering your client. Show them these examples.
- Do a Buffett paradigm with four or five other lawyers.
Admittedly, you’ll need to have attended the Keenan Ball College (KBC) course on Mediation to understand how to use this valuable case evaluation procedure. Warren Buffett’s insurance companies have been using it for years (remember Buffett made billions in all types of industries, but his foundation has always been insurance companies). Those companies don't make the profits they do by paying more than the case value.
The value of having four or five lawyers doing the Buffett paradigm is that you can cushion the extreme of an unrealistic number and protect the process. Generally, puppy lawyers have a higher number and seasoned lawyers have a lower one and it's good to have several evaluations in the mix.
- Get a hedge fund involved.
Today you can swing a cat and get a hedge fund to do virtually anything in your case from financing overhead to case expenses. While I've never done it on one of my cocounseling cases I have advised it and done it in my consult cases.
Let me tell you about how it's done: Let's say defendant has offered $2.5 million and the client realizes in that number they will walk with little more than a million. Tell the hedge funders you’ve got $2.5 million on the table and you want to borrow $500,000 (or $750,000, or even $1 million) to pay the client now. The hedge fund accepts and the client gets the money right away with the understanding that even if the case goes south, the hedge fund payment has no recourse and doesn’t have to be repaid.
If the client is truly worried about losing the case or waiting a long time before the case is over, the hedge fund payment removes both problems.
- Use past verdicts and settlements.
We’ve used this method for many years but let me caution you not to use the old time settlement values pre-Reptile©. We have chronicled more than $7 billion in settlements and verdicts using the Reptile© and we are in the process of categorizing all of those outcomes for case type, venue and, of course, outcome. It’s a matter of pulling off half a dozen or more similar cases where the client can see the value of the case.
- Make the client sign off.
There is something about writing something down and affixing your signature that screams out the importance of it. So write all the clear reasons about why the settlement should not be accepted. Then ask your client to acknowledge it in writing. If they refuse to accept the reasons, have them sign off, illustrating that the reject the advice. You should even insist they take 48 hours of reflection before they sign. In my experience this last recommendation works in a high number of cases.
THE TWO EXTREMES
As I inferred above you should not be heavy-handed with the client. They will resist. Many will think that the only reason you are pushing for a higher amount is because of the contingency fee and therefore your arm twisting is because of your interests and not the client. Avoid this toxic condition by not arm twisting.
I can't help but talk about the other extreme: The lawyer who's afraid to try the case and who is a woozy and caves at every settlement opportunity. You know the type, the lawyer that does not have the financial security to hold out for a higher settlement in time; the lawyer who doesn't want to divert cash flow into trial expenses and then wait until the case is resolved.
Let me tell you about the lawyer who approached me in the bar at one of our early seminars… He told me a tale about not ever being able to try a case because his client always caved. Now obviously a client caving is going to happen occasionally – but not every time. So when the lawyer told me that his clients have been caving for the past years I was a little suspect. So I took a page out of my AA experience and decided to do an intervention (of course, with the lawyer’s permission).
The next day we had a small breakout with 20 lawyers per group. In the group I was moderating I told the audience we were going to do an intervention and we were going to slam the lawyer with every possible thing we could think of, in order to see whether or not he himself was a “caver.” We did it in true intervention form, and surrounded the lawyer with the whole 20 person group. Each took a turn accusing, with an aggressive in-your-face attitude. “You don’t deserve to be a trial lawyer. You don’t have the guts to try a case,” etc.
This went on for some time until a diminutive female lawyer decided to take her turn. Her words were on fire, accusing the lawyer of not having the balls to try a case – words that completely emasculated him. It wasn't pretty, but it worked. We extracted a promise from the lawyer, who said he’d tell us when he did finally try a case. He got his chance about three months later and it was a nice verdict. Since that time, I understand the lawyer has gotten several other good verdicts.
So the next time your client wants to cave, ask yourself whether or not you've done everything possible to enable your client to try the case.
I can clearly remember an obstetrical case I handled years ago in Jacksonville, Fla. The mother originally contacted the office simply to get a government-subsidized apartment on the first floor of her complex. Every day when her wheelchair-bound child was dropped off by the school bus she would have to throw her child over her shoulder and walk up two flights of stairs, and then after having her child safely in the apartment, she’d have to go back and drag the wheelchair up the flights of stairs.
All she wanted out of the case was a first floor apartment. I remember in the courthouse, out in the hallway on the first day of trial, the defense had slightly increased the lowball offer and the mother was ready to take it. I literally got down on my knees and begged her to turn it down. Then, I ultimately did something that I should not have done (and will never do again); that is, I guaranteed the mother a good verdict. I told her if the jury didn't give it to her, I would.
Thankfully we got a good verdict in the courtroom and I was cured of ever doing that again. Let me conclude by telling y’all a major realization that I should have mentioned before: Look at your client. Understand the unfairness of the devastation the defendant has caused on their life. No plaintiff deserves it and inside the process, I’ve learned they're never going to get justice. The clients are understandably scared (petrified and deathly afraid) of getting dumped and facing the rejection of a defense lawyer.
THE CLIENT MUST BELIEVE THEY DESERVE A HIGHER SETTLEMENT
You can start to enable your client to have a mindset of “I deserve justice.” If you’ll recall, during the Keenan Method of Witness Preparation DVD, I specifically cover the importance of getting your client to embrace their Major Truth. If you’ll remember the first client on that DVD, in the early part of the preparation, she clearly stated that her greatest concern was, “People will believe that I'm a bad mother and that this happened because of me.”
This of course is the infamous guilt period, and the DVD series teaches how to advise clients how to remove their quilt. For those of you who have seen the DVD, you’ll remember on the second day of preparation, we entered the “gut check” step, and this same mother – after having the guilt removed and the Major Truth embedded – says, “I dare them to say I’m a bad mother. I did everything a mother should do.”
This reminds all of us, my friends, you can’t wait until the eve of the mediation to start embedding your client’s power to turn down lowball offers. It starts in witness preparation and, together, with the other suggestions above you’ll stand a substantial likelihood of taking a scared little rabbit of a client and making them into a lion.
Bottom Line: It ain't easy, but you can empower your client with the multitude of techniques discussed above. The burden is on you to do it.