Maryland Injury Lawyer Blog

Normally, when the Pop Tort writes a post, I'm sitting in the amen chorus. Today's post is a little different.

The post talks about excessive salaries of hospital executives, particularly at hospitals that are struggling financially. In the abstract, I do not mind hospital executives making a great deal of money. Money attracts talent and hospitals are complex enterprises that need quality executive talent. We want the talented people working at hospitals instead of running widget manufacturers.

Are some hospital administrators woefully overpaid? Of course, there are a lot of hospital executives making a great deal of money at struggling hospitals. How do they justify that? Some can't. But the ultimate question is what shape would the hospital be in if not for the quality leadership at the top? If the answer is "millions of dollars worse," then you have someone who ought to be paid very well.

Baseball has a way to measure this statistically for hitters: value over replacement player (VORP). This statistic determines how much a hitter contributes in comparison to a fictitious "replacement player," who is the statistical average for his position. How many more runs do you score with Derek Jeter compared to Joe Average shortstop?

Of course, in real life, it is much more difficult to value talent because there are so many variables at play and it requires so many judgment calls. Accordingly, the only people who can begin to value the worth of a hospital administrator are the Board of Directors of the hospital or whoever is evaluating the top hospital administrators. If they neutrally and objectively believe their top guy is worth millions of dollars to their hospital because of the administrator's unique skills and talents, I say pay the woman (or man).

Nora Freeman Engstrom writes an amazing article for the Georgetown Journal of Legal Ethics titled Run-of-the-Mill Justice. She writes about settlement mill law firms, writing with a 60 Minutes investigative journalism style that names names, calling out a few law firms she has labeled as settlement mill firms. Engstrom characterizes these firms as "characterized by their high claim volume, aggressive advertising, significant delegation to non-attorneys, entrepreneurial focus, and quick resolution of claims, typically without initiation of suit."

There are about 10 different facets of the article I find interesting. I found of particular interest the idea that settlement mills create a "one size fits all" (my words, not hers) kind of justice. Under this system, individualized pain and suffering does not exist for settlement purposes.

What matters, then, for car accident settlement purposes in non-serious injury cases is the amount of the medical bills, what the injuries are, and how much damage was done to the vehicles. Plaintiffs' car accident lawyers have blamed this on a paradigm shift in the thinking of insurance companies in the 90s, This article argues, quite convincingly, that many plaintiffs' lawyers are unindicted co-conspirators in this system.

The author overlooks that settlement mill auto accident law firms are just one contributing cause. The opposite extreme is equally to blame, lawyers who have very small practices and no real marketing presence that do that exact same thing. Take the case, send in the medical records and bills, and settle the case for whatever you can. There are tons of local lawyers parading as lawyers suited to handle car accident claims. The bigger problem? These same lawyers get serious injury accident cases, typically car accidents, where the victim's financial future is at stake. These lawyers take the case because they can't resist and the results are often disastrous. Settlement mill law firms often have the good sense to refer these cases out, realizing they are asking for a legal malpractice lawsuit. Often, the guy with the office on the corner that does wills, criminal, domestic, and everything else under the sun does not have this same sense.

Of course, it is a mistake to label every solo general practitioner as incompetent to handle large auto accident cases just as it is a mistake to assume every firm that runs massive amounts of television commercials as settlement mills.

What is a good plaintiffs' auto accident lawyer to do if he does not want to get caught up in this mess that has been created? If you have a client who wants to settle their auto accident claim quickly and at any price, you are going to be a victim of this system. There is no way out. But if you have a client that wants to maximize the value of their case, there is a simple answer: file suit and request a jury trial. The insurance company is either going to pay at least a reasonable value on the claim or it is going to go to trial where a jury is going to give you the fair value of the case. Because a jury is the ultimate definer of the fair value of a case.

Gauging the next “move” based solely upon how much the other side has budged- “tit for tat” negotiations with no bearing on one’s own case evaluation is another common mediation mistake. It is understandable that negotiators and mediation participants desire proportionality and reciprocity in adjusting demands and counteroffers. The problem is that many adjusters think that plaintiffs have no ceiling on the amount that they can demand, whereas defendants can never offer anything less than zero. For this reason, arguments that, “We’ve come down by $100,000 so you need to come up by $100,000” often fall on deaf (adjuster or defense lawyer) ears.

Defense lawyers often set up mediations better than personal injury lawyers. The defendant's lawyer will call you and ask for a demand. You decide to be reasonable. So when you show up at the mediation, the range is between reasonable and zero. That is the wrong psychology to settle a case.

The best way to address this problem: if defendant puts you in this game, don't be above the game with your reasonableness. Your opening demand under this dynamic should mirror the defendants’ maximum exposure. Most states now have caps on non-economic damages. Add up your economic damages: past and future medical expenses, past and future lost wages, loss of earning capacity, vocational training and/or rehabilitation. Add that number to the amount allowed under the applicable non-economic damages cap. This should be a good approximation of the maximum exposure on the claim. With any luck you will be right around the amount of the reserve the insurance carrier has set for the claim. This should help in estimating the settlement value of the case on the continuum between maximum value and zero. This will let you calibrate your demands to where you want to end up on a case, not necessarily to match the other side amount for amount.

This tactic only works in a case where it is possible a jury would give such an award. Not likely but "best day possible." If you are demanding the cap in a soft tissue injury claim, you are also sending the wrong message. Similarly, when you demand $5 million in a case where your cap is $2 million, you are sending the same "I'm not exactly sure what I'm doing" message.

I am going to be speaking to the North Carolina Advocates for Justice in Greensboro on Friday, December 11th on maximizing the value of personal injury claims and the related issue of dealing with insurance companies.

John Bratt's Baltimore Injury Lawyer Blog offers advice on defending motions for summary judgment.

You can find sample oppositions to motions for summary judgment here.

The article that John Bratt and I wrote for Trial that offers advice to plaintiffs' personal injury lawyers on the mediation of catastrophic injury cases is is now available online for American Association of Justice members. If you get the magazine, you should be getting it any day now. Email me at ronmiller@millerandzois.com with any questions or comments that you may have.

The Maryland Court of Special Appeals decided Romero v. Brenes yesterday. This case involved a single car accident that killed both passenger and driver. A Montgomery County trial court granted the Defendant's attorney's motion for judgment at the close of the passenger's wrongful death case because the trial judge found that the evidence was insufficient to establish that the negligence of the driver was a proximate cause of the fatal crash.

Defendant's argument was essentially "hey, no one saw this accident so no one knows what happened." The majority of the Maryland Court of Special Appeals found a jury could have found that the unexplained loss of control by driver and the driver's excessive speed was the proximate cause of this fatal car accident.

Continue reading "Single Car Accident Opinion from Maryland Court of Special Appeals" »