Noel S. Cohen and Amy Jane Longo Share Insights on Managing Litigation

This ‘Conversation with the Experts’ section featuring Litigation Management is produced by the LA Times Studios team in conjunction with Polsinelli and Ropes & Gray LLP.

After the many unprecedented operational changes that businesses in every sector have had to make over the last few years, a whole new landscape has emerged in terms of litigation issues. This has left even the most seasoned human resources leaders and C-suiters struggling to find answers to crucial questions. What should management be focusing on in terms of new standards, laws and protocols, and how can litigation be most effectively managed?

To address these issues and concerns, as well as many other topics pertaining to the world of litigation, the LA Times Studios team turned to two uniquely knowledgeable experts for their thoughts and expertise about the most important “need-to-know” insights and to get their assessments regarding the current state of trial law and the various trends that they have been observing.

Q: In what ways has the practice of trial law changed over the past five years?

Amy Jane Longo, Litigation & Enforcement Partner, Ropes & Gray LLP: In 2020, COVID all but halted trial practice for around one year. Courts shut down, incentivizing many parties to resolve disputes without court intervention by, for example, setting accelerated discovery deadlines, which pushed parties toward settlement. Much of litigation moved online, enabling parties to save significant sums on travel and other costs. When the courts reopened, trials were reset at a record pace, causing a frenzy of activity. The pendulum is just starting to swing back now, as trial calendars normalize. But the ability to litigate remotely - whether for depositions, hearings, mediations or otherwise – has had a lasting effect on the practice and is here to stay.

Q: What are some of the most common causes for litigation today?

Noel S. Cohen, Office Managing Partner and Commercial Litigation Chair, Polsinelli: I have seen a significant uptick in partnership disputes and “business divorces.” When starting a business, founders are on good terms and looking to build something together with a shared vision. They often do not think of the possibility that their relationship could go sideways at some point in the future. I am finding that in many instances, the corporate governing documents for the business are often incomplete or do not even exist at all. When it is time for a breakup, the lack of sophisticated documents becomes a problem. When we work with new businesses, we recommend they spend the time and money upfront to put proper procedures in place in case issues arise down the road, as the cost and time it takes later to deal with the dispute is exponentially higher without appropriate governance documents.

Q: How should companies handle disputes internally to avoid them escalating into lawsuits?

Longo: Depending on the nature of the dispute, companies may want to engage outside counsel early to assist with either an internal investigation or to take over dispute correspondence. Sending a well-drafted letter from the right attorney is frequently effective in staving off legal action. For issues regarding contracts, companies will also often include clauses that require the parties to engage in informal dispute resolution prior to initiating court or arbitration proceedings. These informal proceedings provide a forum for representatives from each party to approach the dispute with a cooler head than they might if one party threatens litigation.

Q: What impact does the rise of alternative dispute resolution (ADR) methods, such as mediation and arbitration, have on traditional litigation?

Cohen: Arbitration has become more commonplace over the last several years as cases will typically be adjudicated quicker and cheaper, and the proceedings remain private. As to mediation, we see clients more interested in going that route in a post-COVID world due to the length of time it can take to get from initiation of an action through trial (and the appellate process) in court. While mediation usually results in compromise, it does allow businesses to put the dispute behind them and spend their time and resources in a more productive fashion. Many litigation attorneys, me included, represent clients in arbitration and mediation, and part of our job involves advising clients on the pros and cons of choosing ADR over traditional litigation.

Q: When is it more strategic for a business to settle a dispute rather than pursuing litigation?

Longo: There are many strategic considerations to pursuing a lawsuit, and the calculus is an important one for any business dispute. While the expected costs of litigation in relation to the potential outcome is a chief concern, there are many additional aspects. These include considerations such as how strong the company’s factual and legal positions are; whether litigation may expose the business to potential counterclaims; the parties’ potential future business relationship; the time and resources that litigation will consume; and how key the dispute is to the company’s business as a whole. Other factors such as the availability of necessary evidence and the state of the applicable law are also important. And as to whether to initiate a lawsuit, there is the perennial consideration of whether to sue first or risk being sued – a decision that can determine the forum where the dispute is heard.

Q: How can businesses best manage the financial and reputational risks associated with high-profile lawsuits?

Cohen: The first thing businesses can do when faced with a high-profile lawsuit is utilize the arbitration provisions in the contract so that the action proceeds in private arbitration rather than a public forum. There are, of course, pros and cons to arbitration, but that is the best way to keep harmful information out of the public eye. If the action proceeds in court, some of our clients have effectively utilized public relations firms to attempt to control the narrative or at least get ahead of potentially harmful publicity.

Q: What are some common pitfalls businesses encounter during litigation, and how can they be avoided?

Longo: Paying attention to document preservation early in a litigation, particularly the retention of email and text messages, can save businesses significant costs down the line. This is particularly true for businesses that do not have policies in place preventing employees from using personal devices for business communications. Employees may not realize that text messages are “discoverable” in a litigation and may have their phones set to auto-delete messages. Businesses can run up costs battling discovery fights when key employees don’t properly preserve their text messages even after they receive a preservation notice. To get ahead of this, businesses can implement robust policies concerning the use of personal devices for business purposes and make sure that counsel works directly with employees on preserving information on personal devices once a complaint has been filed.

Q: In the current climate, what is the typical amount of wait time from filing a case to actually going to trial?

Cohen: The wait time largely depends on the venue. In arbitration, you can typically proceed through a hearing in one year. In federal court, it is closer to two years, and in state court, it can often take up to three years in the larger metropolitan areas. With respect to state court, that timeframe is further dependent on the judge assigned, as some have busier dockets than others.

Longo: There is no uniform answer to this question. The amount of time it takes to try a case from the filing of a complaint through trial depends on (1) the judge; (2) the court; and (3) the type of case. While state court dockets tend to move more slowly than federal dockets and more complex matters may consume more time moving through discovery, that is not true in all instances. Individual judges have significant influence over case timelines, and they frequently have enormous caseloads. Some judges expect to see a case tried within six months of filing no matter the subject matter, while before other judges, it may take years before a simple breach of contract matter goes to trial. There is invariably a bit of a “luck of the draw” when it comes to wait time.

Q: How does a business go about finding the right litigation attorney or advisor for their particular situation?

Cohen: Fit is key. The business’ leadership will want to find an attorney that is on the same page and understands their goals, not just for the specific litigation, but for the broader business. The attorney-client relationship is long-term. Even if it is just one action, that action may remain pending for many years, and with appeals, that could be even longer. As such, while it may sound simple, the personality fit of the attorney sometimes can be just as important as their skillset.