Taking An Important Case To Trial

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Steven Molo and Sara Margolis | MoloLamken

MoloLamken LLP partners Steven Molo and Sara Margolis discuss how a party in a high-stakes trial might improve its chances of success, or, at least avoid disaster

It’s the rare businessperson who wants to have an important issue or, worse, a company’s fate decided by a judge or jury. The vast majority of lawsuits are settled before it comes to that. But trial happens, sometimes with billions or hundreds of millions of dollars at stake.

Given how unfamiliar this territory can be, we spoke with MoloLamken LLP partners Steven Molo, one of America’s leading trial lawyers, and Sara Margolis, a rising courtroom star, to learn how a party in a high-stakes trial might improve its chances of success, or, at least avoid disaster.

The overwhelming number of civil lawsuits in America, including high-stakes business disputes, settle given the risk and the expense. What is it that causes a party – plaintiff or defendant – to say we understand all that, but we’re going to trial?

Steven:Usually, it’s when the parties have fundamentally different views on the value of a case. A variety of factors influence those views. Certainly, the evidence developed in fact and expert discovery is important. But also important are the party’s financial circumstances, its view of what type of trial – and possibly decision – it will get from this judge, and if it’s a jury trial, what the jury research has shown.

Sara: Sometimes, too, a party will have great confidence in its position on a key legal issue it lost earlier in the case. It might be something decided on summary judgment or on a motion to dismiss. Or it could be on how the judge has said she will instruct the jury. A party might believe the risk of a trial loss is substantially mitigated by the likelihood of an appellate victory or at least a favourable settlement after trial in light of the appellate issue. It can be a big bet. But some clients are willing to make it.

Is there a type of case – in terms of the underlying dispute – that’s more likely to go to trial?

Sara: Not really. It can be an antitrust case, a fraud case, a contract dispute, shareholder or bondholder disputes, an IP dispute. You don’t see many class actions tried, but recently we won a nice jury verdict for the plaintiff class in a securities fraud suit.

I know sometimes you are brought in very late in a case, maybe after it’s been litigated for years, to represent a client at trial. How does that come about?

Steven: Sometimes a client will recognise that a case that’s been plodding along for three or four years with discovery and motions is actually going to be tried and there’s a lot at stake. They can look at their lead lawyer, who may have done a fine job up to that point, and realise this is not someone with much, if any, experience trying cases before a jury or a judge. That can be a sobering moment.

When you think about it, that makes sense. Not many cases get tried so not many lawyers have tried many cases.

Clients sometimes find us and say, can you come in and work with our existing lawyers who we love, but who just aren’t that experienced with trials. We do that regularly.

Sometimes the firm itself will approach us and say, we’ve gotten it this far but adding your firepower can make a real difference. Once in a while, a client will want to replace its law firm over a disagreement concerning trial strategy or whether the case should be settled.

Ultimately, a client has to feel comfortable and believe it’s got an experienced fighter leading the charge and a competent well-structured team that can take the case from where it is to a win.

You say a ‘competent well-structured team’. What do you mean?

Sara: You can have a great lead trial lawyer but in a complex, high-stakes case, there’s too much going on for that person to be effective without other strong players focusing on discrete aspects of the trial. For example, we might have a lawyer focused on damages, another focused on liability experts, another focused on legal issues and jury instructions. They need to go deep in their assigned areas but also have in mind the broad strategy and be aware of what’s going on in other aspects of the case.

Steven: And the team should be diverse.

Sara: Right. Diversity broadens your perspective and provides strength. Not everyone looks at the world, or the issues you are dealing with, the same way. Diversity isn’t some catchphrase. It leads to better outcomes.

What you describe sounds like a highly-structured, almost military approach. Can you provide a sense of what that actually looks like at a trial?

Steven: We believe the case should be tried before we ever set foot in the courtroom. By that I mean, we’ve mapped out the testimony of our witnesses and the cross-examination of opposing witnesses, including the exhibits we’ll use with each. We’ve thought through the evidentiary issues. And we do this collaboratively to capture the best thinking.

Sara: We have our own system for organising that. The same system carries over from trial to trial, so expectations of team members are clear. We’re not re-inventing the wheel with each case. We’re big on white boarding as a tool to spark creativity and collaboration but bring discussions to a concrete point.

Steven: We have dinner as a team in a conference room at 7 p.m. every day after court. There’s an agenda covering what needs to be done based on our plan and the day’s developments.

Wow. That sounds rather rigid. Aren’t trials supposed to be dynamic?

Steven: They are dynamic. But having an experience-based system and a plan, we can better address courtroom twists and issues as they arise.

You mentioned jury research. What exactly do you mean by that?

Sara: There are consultants who, under the confidentiality protections of the attorney-client privilege and work-product doctrine, run various exercises – surveys, focus groups, mock trials – and help develop themes and assess likely juror reactions. We’ve worked with many of the top people throughout the country.

Do you do that with bench trials?

Sara: Sometimes, in a fashion. We might bring in one or more retired judges to have a look and get their thoughts.

What about graphics? They seem to be used extensively at trials and hearings?

Steven: Good graphics are essential. There are studies showing 85% of communication is non-verbal. And we live in a smart phone/Twitter world. People’s brains are trained to receive and process information and form beliefs quickly – through displays of information, not just the spoken word. We account for that. We work with outstanding graphics consultants who we’ve known for years to hone our messaging.

Sara: Graphics are something most lawyers get wrong.
They use too many. They are jammed with too much information. They don’t understand color. It’s usually death by PowerPoint.

How important is subject matter expertise?

Sara: At this stage, advocacy skills are far more important than subject matter expertise. The legal issues have been fleshed out. We usually have a subject matter expert as part of the trial team. But the lawyers’ job now is to persuasively present the important evidence within the framework of the applicable law.

Are there aspects of a trial that lawyers without a lot of courtroom experience tend to struggle most with?

Steven: Cross-examination is probably the most difficult skill to develop. Preparation is critical, but an effective cross-examiner must respond and adjust in the moment. It takes lots of experience with inevitable failures along the way to excel at it. People think success as a prosecutor equates to success as a private lawyer. It helps, but prosecutors often are not required to cross-examine many witnesses, so that’s not necessarily true.

Another common struggle is seeing the forest for the trees. People become so immersed in facts developed over the years that they won’t focus on the few that matter most. Often, it’s a lack of confidence or a ‘cover-your-backside’ mentality – two documents can prove the point but let’s introduce 15, so we won’t be criticised. What’s lost is the 15 can confuse or bore the judge or jury. Less is often more.

Persuasion is about striking an empathetic chord with your audience and telling a simple story that has the equities as well as the facts favouring your side.

What about working with witnesses?

Sara: Many litigators are experienced in preparing witnesses for depositions. But depositions, at least those taken in discovery and not for the purpose of presenting trial testimony, are quite different from trial testimony. A trial witness will affirmatively tell the client’s story, or part of it, and different communication skills are required. An experienced courtroom advocate shapes the witness preparation to account for that.

Also, there’s a tendency among less experienced lawyers to want to tell the whole story – or at least a good part of it – with each witness. They fail to recognise that a well-presented case at trial is like a mosaic, with various pieces fitting together to form the big picture.

Other than the obvious benefit of courtroom expertise, are there advantages to using a litigation specialist firm like yours to try a major case?

Steven: Certainly, when we are hired it sends a message to the other side that the client is ratcheting things up and ready to do battle from the trial court all the way to the Supreme Court, if necessary. That can be one factor in reaching a favourable settlement.

Additionally, we are independent. A large percentage of our clients come to us to deal with a specific serious matter. Without a corporate practice, we lack the institutional ties that can sometimes – consciously or unconsciously – influence advice and strategy. Our advice about whether to proceed to trial or settle in a given range is based on our studied view of that case and the client’s articulated goals.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email experts@adviseandconsult.net.

Robots on Construction Sites Are Raising Legal Questions

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Peter Sheridan | Construction Executive

Mark Twain said that “good decisions come from experience. Experience comes from making bad decisions.” Aesop warns “be careful what you wish for….” But is there a good decision to be made now to employ robots on your next project? There is not a lot of experience to help us make that decision, and the robotic laborer that does not tire or need breaks or desire a raise or promotion looks like an option we might all wish for when planning our next project.

Are there pitfalls, traps for the unwary? Always. Spotting them is the trick. After a brief glimpse into the past for appropriate context, there are a few traps that need to be considered.

REVOLUTION IS EVOLUTION

Three prior industrial revolutions, illustrated by the ages of the steam engine, mass production and electricity, and the emergence of digital technology, ushered in change at an ever-accelerating pace. Robotics is included by many observers as part of the Fourth Industrial Revolution.  

The integrated circuit (IC) is what makes robotics possible (as it does for all modern computing). Gordon Moore, who in 1975 predicted the doubling each year of the number of transistors in an IC, might not have thought that today, in 2023, a single IC contains 58 billion transistors. 

Technology entered our industry long ago. For example, at a basic level, camera drones started inspecting bridges in 1995. Now, large projects typically have several drones flying each day to capture what progress they can of the job.  

Keep in mind that there is no race against these machines that can be won, as Kevin Kelly, the founder of Wired magazine, has said, “If we race against them, we lose. This is a race with the machines. You’ll be paid in the future based on how well you work with robots.” Money is pouring into construction robotics as well, an indicator as to where our industry is headed.  

While the industry is still catching up to other industries in the sophistication of its robots, there are already many useful robots on the market and in daily use, including those used for repetitive work by programmable, mobile, strong, workhorse robots or data-gathering devices that can resemble small tanks or dogs.  

Giving the complexity and ever-changing nature of a construction site, with cluttered worksites, unforeseen conditions and revisions happening in real time, adding robots to the mix may make it easier, or harder, to control the project. Ask these questions: How do you integrate the robot into your team? How does the robot learn the experience your team already has? A few ideas on how to establish control and plan to use robots effectively are out there, and executives and counsel need to consider them not in five years, but now, as robots become more advanced with every passing day.

THREE LEGAL SCENARIOS TO CONSIDER

1. Suppose a data-gathering autonomous LiDAR robot (Doxel) crawls around your project on rubber tracks, goes upstairs on its own and knows the AUTO-CAD layout. It records the progress and tolerance compliance, or lack thereof, of your overhead MEP (mechanical, electrical, plumbing). That robot can be required in your MEP specs, triggering the duty of the design-build MEP subcontractor to use that robot and gather data and supply it to the general contractor and owner. In that vein, if the architect does not include the robot requirement in its draft specs, some may argue that not including it reflects the lack of the requisite professional skill and care ordinarily provided by architects working on modern, large and complex projects.

Now apply a similar standard to a general contractor looking for the right MEP design-build sub(s). The “good-and-workmanlike-manner” standard requires a quality of work performed “by one who has the knowledge, training or experience necessary” performing  in a manner “that is generally considered proficient…” Proficient in a world of robots means using robots, some might argue, so be prepared. Perhaps include in your contract that such robots are required or that not using them is considered for this project to nonetheless be proficient.

2. Your paper plan days are over, and a layout robot (Dusty) you required in the specs uploads the AUTO-CADs and then prints a digital full-size floorplan on the concrete deck of levels eight through 45 of your high rise hotel project. It even prints that plan on the dangerous edges of that project, which workers must avoid. Safety improves, but the operator of the robot has not properly programmed it or a bug in the processing arises, and floors nine through 15 are laid out incorrectly and delays in build-out and fit-out ensue.

The architect included use of this robot in the specs but did not include a verification protocol. The general reviewed the work on the eighth floor where it was first used, but not after, and the vendor/sub actually using and operating the robot blames the AUTO-CAD upload. Not your normal dispute, your counsel encourages hiring a programmer expert to come to the DRB during the project to help resolve this issue and ascribe blame. The DRB for your project has now become a venue for forensic review of robot programming, use and timely verification of accurate layout. Does the robot-using sub have insurance, or the general contractor, the architect, the owner, for this cause of loss? Is this form of loss a covered loss under your insuring requirements in the governing contracts or arguably excluded?

3. Your specified site-inspection robot (Rover) on a cast-in-place structure, programmed to avoid damaging in-place concrete shoring and to avoid workers, nonetheless runs into several initial shores, and wet concrete from above falls and injures workers on the floor below.

Or your scaffolding robotic assistant (Atlas) throws a bag of tools to a worker and hits the worker, injuring him.

Robotics providers may not have the financial wherewithal to respond to these injuries. The owner and general contractor need to know all the contractual arrangements that bring the robots to the site and control for the risks created. Keep in mind that there are currently no OSHA standards for the robotics industry (according to the OSHA website). ANSI (R15.06), however, does set forth safety requirements; thus, your contracts might reference the correct safety requirements.

IF YOU CAN’T BEAT THEM, JOIN THEM

Robots will replace a certain amount of construction workers, like they have in other industries—a recent MIT Sloan Business School study says so, and it may come just before or alongside the heightening skills crisis in the key trades that nine of 10 construction businesses (studied in Europe) predict to occur by 2030. 

Think of it like this—after 2030, will there ever be another drywall apprentice? McKinsey thinks that by 2065 up to 44% of all construction jobs will be automated. Worldwide, that means 82 million jobs in construction lost to automation. 

So, trades companies, start training your apprentices in automation and programming. All responsible persons in this industry need to start adapting their contracts, their insurance and their mindsets to the present and increasing future use of robots on your projects. The Fourth Industrial Revolution is here, so race with or ahead of the machines, not against them.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email experts@adviseandconsult.net.

False Claims Act Investigation Is Covered Under Insured’s D&O Policy, Court Says

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Lilit Asadourian and Alice Kyureghian | Barnes & Thornburg

Highlights

The Delaware Supreme Court affirmed a summary judgment ruling against ACE, finding that the professional services exclusion in ACE’s management liability insurance policy does not apply to bar coverage for a False Claims Act (FCA) investigation against Guaranteed Rate. This landmark case carries substantial precedential significance for policyholders facing FCA investigations and related qui tam lawsuits

In a unanimous decision, the court held that “[t]here is ‘no causal connection’ between the failure to perform professional services and the damages alleged by the government”

Policyholders should be aware of positions previously taken by insurers involving similar policies and similar circumstances, which could provide insight into how the insurers have interpreted key policy provisions

The Delaware Supreme Court on Sept. 14 affirmed a summary judgment ruling against ACE (a Chubb unit), finding that the professional services exclusion in ACE’s management liability (D&O) insurance policy does not apply to bar coverage for a False Claims Act (FCA) investigation by the government against mortgage lender, Guaranteed Rate (GRI). This landmark case carries substantial precedential significance for policyholders across the nation facing False Claims Act investigations and related qui tam lawsuits, which are costly to defend and settle.

In a 23-page opinion, the Supreme Court comprehensively analyzed whether FCA allegations “arise out of” professional services and determined that they do not, finding instead that the certifications GRI made to the government about its quality control and compliance with the Federal Housing Administration (FHA) and the Veterans Administration (VA) program rules were a separate act that broke the causal chain.

By way of background, ACE sold GRI a primary D&O insurance policy that agreed to pay for loss that GRI becomes legally obligated to pay by reason of a claim for “any error, misstatement, misleading statement, act, omission, negligent, or breach of duty actually or allegedly committed by” GRI. As relevant here, the policy contained what is commonly known as a “professional services” exclusion, which excluded coverage for loss “arising out of” GRI’s rendering or failure to render professional services.

GRI is a mortgage lender whose professional services include originating and underwriting loans for borrowers. GRI is also an approved lender in the federal government’s Direct Endorsement mortgage insurance program, which requires GRI to certify to the government that loans meet FHA and VA program rules.

In 2019, the federal government initiated an investigation against GRI for alleged FCA violations after a whistleblower alleged that GRI originated and underwrote federally insured loans that did not meet program guidelines. GRI tendered the claim to ACE, which denied coverage under the professional services exclusion. ACE argued that the FCA claim “arose out of” GRI’s professional services and was therefore excluded under the policy. Relying on Delaware courts’ liberal interpretation of the term “arising out of,” ACE argued that “but for” GRI’s professional services, the FCA claims would not exist. The Delaware Superior Court ruled in GRI’s favor on both a motion for judgment on the pleadings and again on summary judgment. ACE appealed the rulings to the Delaware Supreme Court.

The Delaware Supreme Court disagreed with ACE and affirmed the trial court rulings. In a unanimous decision, the court held that “[t]here is ‘no causal connection’ between the failure to perform professional services and the damages alleged by the government.” The court emphasized that the term “arising out of” requires a meaningful linkage – not just a tangential one. A meaningful linkage was missing here because the FCA allegations were not based on any failure to perform professional services, but rather on false certifications – which interrupted the “but for” causal chain.

In reaching its decision, the Supreme Court adopted the of reasoning of other courts, including Iberiabank Corp. v. Illinois Union Insurance Co., 2019 WL 585288 (E.D. La. Feb. 13, 2019), aff’d, 953 F.3d 339 (5th Cir. 2020), in which Chubb successfully argued that FCA claims involving false loan compliance certifications did not qualify as professional services. In Iberiabank, Chubb had issued a professional services (E&O) policy agreeing to cover loss for any claims arising out of Iberiabank’s rendering or failure to render professional services. Thus, taking a contradictory position in Iberiabank meant Chubb again avoided coverage.

The court noted that while Iberiabank was not pertinent as a matter of judicial estoppel, it did bear on how Chubb (ACE) has interpreted “professional services” under similar policies in similar circumstances.

This decision has several implications for policyholders across all industries. First, policyholders facing FCA claims should consider closely analyzing both their D&O and E&O policies to evaluate whether coverage may be available under either or both policy types. Second, regardless of the type of claim or policy at issue, this case may serve as precedential authority for interpreting the term “arising out of” – a common term used across all policy types. Third, policyholders should be aware of positions previously taken by insurers involving similar policies and similar circumstances – as such positions could provide great insight into how the insurers have interpreted key policy provisions.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email experts@adviseandconsult.net.

Are Standard Form Construction Contracts Fit for the ‘Smart Infrastructure’ of the Future?

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Mark Crossley, Annie Lund and Rupert Sydenham | Hogan Lovells

Infrastructure projects increasingly involve constructing both physical infrastructure and digital infrastructure works. But the current standard form construction contracts have not been designed to address the risks particular to these kinds of projects. What are the risks particular to projects involving both physical and digital infrastructure? And how might standard form construction contracts need to adapt to address them?

We recently published an article in the July 2023 edition of the International Bar Association’s journal Construction Law International titled ‘Are standard form construction contracts fit for the ‘Smart Infrastructure’ of the future?’1.

Here, we summarise the key points of the article. To read the full-length article on the IBA’s website, please click here.

In our article we have posed the question whether current standard form construction contracts are fit for the ‘Smart Infrastructure’ of the future, that is, projects combining both physical infrastructure and digital infrastructure. This is because the current standard forms have not been specifically designed to address the risks particular to projects delivering both these types of infrastructure works under a single contract.

In this article, we identify some of the risks particular to these projects. We then go onto explain the changes to standard forms that might be contemplated to address them. The matters identified are intended to provoke discussion about how the standard forms might be developed.

What are the risks particular to projects involving both physical and digital infrastructure?

Enhanced collaboration risk

While employers, consultants and contractors have to collaborate a lot during physical infrastructure-only projects, they are likely to have to collaborate even more during projects involving both physical and digital infrastructure.

Developing digital infrastructure tends to be a more iterative process than developing physical infrastructure. This means the design phase of a project involving both physical and digital infrastructure is likely to involve more back-and-forth communication between the employer’s end users and the contractor’s development team than during a physical infrastructure-only project and this extended collaboration phase can be hard to manage.

Enhanced cost/time risk

Employers, consultants and contractors may have a good feel for estimating the cost and time risks associated with scope changes on physical infrastructure-only projects. But estimating the cost and time impacts of making changes to software is notoriously difficult, so they may therefore have less feel for the cost and time effects of scope changes on a project deploying technology within physical infrastructure. This in turn heightens the risk of unanticipated cost and time overruns.

Enhanced project continuity risk

There are potentially more threats to the completion of a physical and digital infrastructure project than a physical infrastructure-only project. After terminating its contract for a physical infrastructure-only project, an employer often struggles to find a replacement contractor to pick up where the previous contractor left off. But it might be even harder to find a replacement contractor for a physical and digital infrastructure project due to the candidates being unable and/or unwilling to continue developing a rival’s technology.

How should standard form construction contracts be adapted?

To identify how standard form construction contracts should be adapted to mitigate these risks, we compared the relevant provisions of FIDIC Yellow, also known as the Plant and Design-Build Contract 2017, to equivalent clauses commonly found in IT outsourcing and systems implementation contracts. As a result of our analysis, we recommend considering the following initial adaptations for construction contracts with a digital infrastructure element:

The role of the Engineer

The iterative nature of digital technology development and the potential for mismatch between the employer’s expectations and the contractor’s work mean IT contracts tend to take a more complex and collaborative approach to managing a project as compared to FIDIC Yellow’s approach.

Rather than giving ultimate authority to a third party engineer, IT contracts often concentrate on parties discussing and making decisions together via a hierarchy of boards and committees, each comprising party representatives and split into different sub-committees according to the project’s needs.

Seasoned employers are unlikely to forgo the role of the engineer entirely. However, parties could provide for a system of management boards to facilitate collaborative working between the parties in the areas where it is required, while maintaining the role of the engineer. They could also appoint a panel of engineers of different technical disciplines or specify that the engineer have particular IT qualifications.

Change control mechanisms

In FIDIC Yellow, the engineer holds the key role in the change control mechanism, determining the scope of any instructed change and the associated time and cost adjustments. By contrast, IT contracts tend have more flexible and balanced change control provisions, with the effect that the parties are more likely to share the cost and time risk of any unanticipated scope changes.

Employers will be uncomfortable about weakening their position when it comes to change management. However, employers may need to revise their views because contractors may be commercially reasonable in arguing that the parties should share novel technology risk. Where the contractors are specialist suppliers, they may have the bargaining power to insist on a more balanced approach to change control too.

The use of IP

FIDIC Yellow’s IP clauses are brief whereas IT contracts’ provisions are more nuanced. They distinguish between different forms of IP: between that held pre-contract and that developed for the project; and between contractor-owned IP and third party IP licensed in. They also contemplate infringement action, open source software, assignment, transfer and sublicensing comprehensively. IP control following termination is also addressed in “deliver-up” provisions. These compel the supplier to pass its source code to the customer when leaving the project, enabling progress to continue.

Projects involving the delivery of both physical and digital infrastructure works surely require the more detailed and nuanced IP provisions found in IT contracts to be incorporated into construction contracts, given the increased chance of disputes stemming from the blurred lines of IP ownership between employer and contractor.

Join the discussion

These proposed changes to standard form construction contracts are just the starting point of the discussion. Performance standards, payment, termination and warranty clauses, for example, also deserve similar analysis.

References

Construction Law International Vol 18 No 2, July 2023, 22-28

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email experts@adviseandconsult.net.

OPINION: Stop Requiring Exhibit Lists!

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Todd Heffner | The Dispute Resolver

You are conducting the final hearing of a high-dollar construction arbitration. Opposing counsel hands you the next document that counsel plans to use in questioning the witness on the stand. You notice that the document is bates stamped but has no exhibit number. So, you quickly consult opposing counsel’s exhibit list and – gasp – you find that the document is not on the list. What do you do? Do you object?

Assuming this is not your first construction arbitration hearing, you do not object. Why? Because your objection would be futile. Construction arbitrators simply do not exclude evidence on the basis that it does not appear on an exhibit list. (Evidence not produced in discovery or otherwise previously provided might be a different case.) In an informal poll of a dozen construction lawyers conducted by this author, not one reported evidence being excluded solely because it did not appear on an exhibit list. This remained true even when the applicable case management order purported to prohibit the introduction of evidence not on an exhibit list. Thus, to be used in an arbitration hearing, documents must appear on an exhibit list, unless they don’t, in which case you can use them anyway. So far, so pointless.

The scope of the average exhibit list only compounds this inanity. Exhibit lists are typically due several weeks in advance of the hearing. In an ideal world, both parties would have complete witness outlines, including exhibits, ready by this deadline. In this fantasy, both parties would then provide each other reasonably short exhibit lists that would allow for review of each exhibit on the list prior to the hearing. Both parties would then proceed to the hearing secure in the knowledge that they will not be subject to attack by the use of any document excluded from these tidy lists. This, to put it mildly, is not how things play out.

Perhaps the most organized and diligent among us know the exhibits they will use by the time the lists are due and can populate them with just those two- to three-hundred exhibits. Everyone else simply plays it safe and includes every document that could conceivably be relevant. The shortest list this author has received included at least 600 exhibits; the longest approached five figures. Of what conceivable use is an exhibit list that includes essentially every relevant document, and isn’t even binding in the unlikely event one has been omitted?

We have now established that arbitration exhibit lists are typically pointless, excessively voluminous, and largely unenforceable. They are also expensive. An enormous amount of time and money is spent creating exhibit lists. Based on the largely unfounded fear that a document left off will not be allowed into evidence, lawyers pore over the production database, adding and re-adding countless documents.

And yet, even given that (1) there is practically no consequence for failure to include a document on an exhibit list; (2) exhibit lists are almost always too lengthy to serve their intended purpose of previewing a party’s evidentiary showing; and (3) exhibit lists require a tremendous expenditure of time, effort, and money, almost everyone still insists on exhibit lists as a pre-hearing requirement, and almost no one insists that the lists be limited in any way. (There’s no real incentive to push for a strictly limited exhibit list that could come back to bite you in the event you forget to include a crucial document.) Thinking too much on this foolishness compels me to propose this obvious and remarkably simple solution: stop requiring exhibit lists!

I recognize this is a break from tradition. Arbitration, however, is remarkably easy without exhibit lists. I hope you’re sitting down for this: you can just handle the exhibits at the final hearing like you would handle the exhibits at a deposition. Let that sink in. You already know how to proceed without an exhibit list, you just didn’t know it. When an exhibit is introduced, it is assigned the next available number. It is as simple as that.

The logistics largely resolve themselves. Regardless of whether you are using hard copy or electronic documents, there are ways to make their introduction seamless. When using hard copies, you can employ the classic exhibit stickers. When using electronic documents, you can employ one of the multiple tools that exist for on-the-fly branding and sharing of exhibits. Even if your arbitrators request exhibit books, there are any number of practical options. (Consider giving them binders with tabs that are added to as you go, for example.)

Exhibit lists do nothing but incentivize waste. Wasted time, wasted effort, wasted money, and wasted paper—banker’s boxes full of wasted paper. So break the cycle, and embrace this most obvious reform: don’t include a requirement for an exhibit list in your next case management order.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email experts@adviseandconsult.net.