Success in high-stakes disputes: 9 tips from litigation experts
- Paul Rand
- Managing Director and Chief Investment Officer - Canada
Litigation is a serious undertaking. Whether bringing or defending a claim, a company’s executives, board members, and their inside and outside counsel must ensure they are prepared for the rigors of litigation. They must set an effective strategy and execute on the plan, make the right decisions and adjustments at critical junctures, manage internal and external stakeholders, and engage in lateral thinking to minimize risk and maximize opportunities.
In a recent webinar, “9 Tips for Success in High-Stakes Litigation,” Omni Bridgeway brought together a panel of experts to share insights on these business-critical litigation issues from three key perspectives:
- that of a sophisticated client, represented by Amanda Klein, executive vice president, public and regulatory affairs and chief legal officer at Toronto Hydro
- that of a leading litigation counsel, represented by Eliot Kolers, head of the Toronto Litigation & Dispute Resolution Group and partner at Stikeman Elliott
- and that of a litigation funder, represented by Paul Rand, Omni Bridgeway’s chief investment officer in Canada.
The Client Perspective
Toronto Hydro’s Klein provided three tips for understanding larger corporate clients engaged in high-stakes litigation. She advised external counsel to:
1) Understand how litigation affects external stakeholders. From the corporate perspective, it’s critical to align the messages communicated in litigation with public relations and stakeholder strategies. “No high-stakes dispute can be viewed from a purely legal perspective, no matter how strong that legal perspective may be,” Klein said. Legal advice must be coupled with an understanding of how external stakeholders will react to litigation activities.
2) Understand the company’s internal dynamics. This entails not only understanding the company’s business, but also how things are run. External litigation teams should know: what kind of lawyers are working internally; how the legal department relates to the rest of the company; details about the GC or chief legal officer’s role; how the executive team operates and how they relate to each other; the board’s structure and influence inside the company; and what kind of process management structure the company has and how litigation fits into it.
3) Understand that high-stakes litigation isn’t always big. A case may be critical even if on the surface it does not have bet-the-company stakes. The company may be interested in maintaining a legal precedent or obtaining a finding that can be used for other purposes. “On their face, these cases may not be huge,” Klein said. “But over time they end up being huge financially and huge precedents for the company.” For outside counsel, such cases also present an opportunity to develop a relationship with a company, and can put a lawyer or firm at the top of a call list when large-scale litigation does occur, Klein said.
The Outside Counsel View
Stikeman Elliott’s Kolers provided practical advice for litigators and clients who are engaging in high-stakes disputes. He advised them to:
1) Remember the importance of telling the story. An important role for litigators—particularly in high-stakes cases—is to provide judges with a story they can relate to and that helps them see the fairness of the outcome a litigant is seeking. “If you focus too much on the technical, you may lose the decision-maker in the weeds,” Kolers said. “Don’t lose the thread of the bigger story that you are trying to tell.”
2) Remember the importance of industry experts. Lawyers and clients may be inclined to hire professional or academic experts who write and present well, have strong pedigrees and who are likely to withstand a withering cross-examination. But litigators may find that having a witness who has lived in and can explain an industry can be a highly effective tool in telling a story. An industry expert may be able to provide explanations for a client’s decision-making in ways that other types of experts may not be able to provide.
3) Remember the importance of communicating with your client. In high-stakes cases, the stakeholders may include more than just the parties the lawyers are dealing with on a daily basis. They may include shareholders, media, industry analysts, opinion writers, and others. To avoid surprises and to ensure that clients and other stakeholders are well prepared for potential questions, the legal team should ensure that the company is aware of case developments and alert them to issues that may attract attention and warrant the involvement of the communications team.
The Funder Perspective
Omni Bridgeway’s Rand proposed a trio of recommendations for claimants and counsel alike. He advised them to:
1) Seek a second (or third) opinion feedback on claims. A piece of high-stakes litigation will always benefit from more input and different perspectives on the issues. Seeking these opinions can be informal or formal, “but it is always the right thing to do,” Rand said. Outside opinions will allow claimants to validate their strategy or modify their approach. While a client may hesitate to pursue additional opinions because of cost, Rand suggested speaking to a sophisticated litigation funder to evaluate a case. Funders like Omni Bridgeway are staffed with litigators who are in the business of assessing litigation risk and opportunity. If a claimant is considering funding, Omni Bridgeway can provide a view of the case at no additional expense to the client. And if the funding company decides to finance the case, “it’s a ringing endorsement about the strength of the case from people who know what they are doing,” Rand said.
2) Avoid assuming that your client will not be interested in dispute funding. Even if they have substantial resources to pursue litigation, a client may seek to partner with a funder to ensure greater budgeting certainty and to obtain capital to advance a claim where financial resources have not been allocated, or where such resources may be better used on other corporate objectives. Funding can also provide opportunities to monetize claims or portfolios of claims to provide large tranches of working capital to help cover the budget of an internal legal function. Inevitably, on a large piece of litigation, counsel will need to have a difficult conversation with the client about the proposed budget. Funding allows them to offer a strategy which solves for cost sensitivity by moving those costs (as well as any risk of adverse costs) to the funder.
3) Reverse engineer your litigation strategy. A successful litigation strategy should have the endpoint in mind, “and you should work your litigation strategy back from there,” Rand said. “I’m not suggesting that you won’t have to recalibrate as you go. But for external counsel, internal counsel and frankly, for clients, you have to have a clear idea of what you want.” If, for example, the end goal is a monetary recovery, it is critical to ensure the opposing party has the resources to pay, and that the claimant has considered a path to recovery if a judgment is not paid. “We often find ourselves in conversations with corporate clients who are interested in discussing our enforcement funding activities…because they have lingering doubts about whether a defendant will be able to pay or will be unwilling to pay,” Rand said.
The panel discussion is one of a series of Omni Bridgeway webinars on dispute finance and litigation-related topics hosted by Chambers Events. Each is available for free, on-demand viewing. To learn more about Omni Bridgeway’s litigation funding capabilities, visit our Company Insights. While there, explore our recent podcasts, blog posts, and videos. Or contact us for a consultation to learn more about the ways we can help you pursue meritorious claims.