We've all heard the adage that "the best defense is a good offense." The thought is that by being proactive, rather than passive or merely reactive, you will gain a strategic advantage over your opponent by forcing the opponent to be on the defense. This idea certainly rings true in all litigation, especially in mass tort, multijurisdictional, or serial litigation. For large companies subject to litigation in a variety of jurisdictions, whether or not the litigation is a class action or numerous individual lawsuits, the best offense is indisputably created by coordinating a unified defense strategy as soon as possible. Oftentimes this is done by hiring national counsel that can coordinate a defense strategy to be implemented by local counsel in the various jurisdictions where the company is subject to litigation.
Imagine this common scenario. A consumer in Georgia purchases a product at a national retailer's store and is injured while using it. The injured plaintiff files a lawsuit against the national retailer that sold the product, the manufacturer of the product, and the supplier of the product. Somehow others get wind of the Georgia lawsuit, and soon the national retailer finds that it is named as a defendant in numerous lawsuits filed by individual plaintiffs throughout the United States. While the national retailer could most certainly rely solely on its individual defense counsel located in the various states where it is subject to litigation, not taking control of the litigation from the start and presenting a unified front in each state could cause catastrophic results that increase the value of each individual claim. Rather than having numerous, individual defense plans that may be inconsistent with one another and that may be detrimental to the company's overall business interests, a law firm or firms should be hired to serve as national counsel for the purpose of creating, coordinating, and implementing the best defense strategy possible.
Of course, facilitating this relationship can be challenging and frustrating for all parties involved if care is not taken to define each player's role clearly and if key information is not provided to local counsel in a timely manner. While the role of in-house counsel, national counsel, and local counsel will vary depending on the type of litigation, the business interests at stake, and the individual talent, experience, and resources available to local counsel, the company's interests will be best served if an effective working relationship is established among everyone involved in the defense. To ensure that all parties effectively work together for the benefit of the company, national counsel must take charge of the defense, provide consistent information to all local counsel, identify ways to minimize duplication of efforts and costs, and maintain and encourage open communication among all local counsel.
National Counsel Must Take Charge as Soon as Possible
The most important step that a company will take to manage mass litigation or multijurisdictional litigation effectively is to engage national counsel to develop, in partnership with local counsel wherever lawsuits are being filed, a unified defense strategy. Whether one law firm or several law firms are hired to act as national counsel, the company hiring national counsel should consider whether the law firm has (1) experience defending civil litigation, including complex civil litigation, in the specific area that the company is being sued (i.e., product liability, premises liability); (2) experience acting as national counsel to large companies named as defendants in mass or multidistrict litigation; (3) an ability to coordinate, control, and manage the defense and local counsel; (4) the technology and IT support necessary to maintain a large database of documents for use by in-house, national, and local counsel; (5) the ability to manage defense costs and expenses; and (6) any preexisting relationship with the company or in-house counsel. Identifying and hiring a reputable, reliable, and strong national counsel is essential to the long-term success of the defense and to ensure that the company's business interests are adequately protected from the outset.
Develop a Defense Strategy
Once hired, national counsel must develop expertise in the business and inner-workings of the company, including its corporate structure, how it functions on a day-to-day basis.Understanding the roles of the various departments, and personnel relevant to the company's litigation, is crucial, too. National counsel must also be knowledgeable about the company's sensitive and confidential information and its business needs and goals to work with local counsel to protect those interests to the best of their ability. In-house counsel, or when appropriate, company executives, need to ensure that national counsel is fully aware of how the litigation fits into the company's future goals and risk management. The company needs to make sure that national counsel understands how the litigation affects the company's image and business as well.
The most important role of national counsel is arguably the development and implementation of a unified defense strategy. To do this, national counsel and in-house counsel should work together as early as possible to identify common legal issues and defenses, key facts that can be used to defend against the claims asserted by individual plaintiffs, facts that are detrimental to the defense, and the strategies that can be implemented in each jurisdiction to narrow each individual plaintiff's case and limit the overall exposure to the client. To identify key facts and defenses, in-house and national counsel should closely investigate each claim of wrongdoing and each potential defense by gathering and reviewing all relevant documents, speaking with key witnesses, employees, or third parties with relevant knowledge, and attempting to poke holes in the various arguments asserted by the individual plaintiffs. Among other things, national and in-house counsel should explore and fully understand the corporate structure and whether any other entities, related or unrelated to the company, were involved in any act relevant to the pending litigation; the company's decision-making process; the key players involved in the particular issues involved in all pending litigation, including current and former employees and third parties; and any other information that could prove useful to a plaintiff in inflating the value of the plaintiff's case. In-house and national counsel should also identify the information that other co-defendants or third parties may have that can be used by a plaintiff to prove or establish wrongdoing on the part of the company or its employees, or that could aid the company in its defense of the various claims. Knowledge is power, and having the wrong information or incomplete information could significantly harm your client, especially in mass or multidistrict litigation. Gathering as much information and documentation as possible before the start of formal discovery puts national counsel in a much better position to analyze fully which defense strategies will better protect the company and its interests.
Developing a unified defense strategy early on is critical to ensuring that all information provided by the company in lawsuits pending in various states is consistent. However, national counsel must be open and amenable to changing the overall defense strategy as litigation continues and as newly discovered information requires. It is essential to the protection of the company's overall interests that national counsel maintains an open mind and allows the defense strategy to morph and change as required.
While each individual case cannot be handled identically, to protect the company's interests it is essential that national counsel creates and implements a unified defense strategy to be communicated to all local counsel. It is important that national counsel fully explain the reasoning behind the proposed defense strategy and that local counsel understands how the case that it is handling in its state fits into the overall strategy.
Issue a Comprehensive Litigation Hold
While engaging in the initial fact investigation, it is vital that national counsel understands the company's current document retention policy and whether the policy was being followed and enforced before the filing of the initial lawsuits. National counsel should work together with in-house counsel, company executives and the company's IT personnel early on in the litigation to identify the various sources where relevant information and documents are maintained. Sources include company and private e-mail accounts, servers, databases, file or storage rooms, employee cell phones, or other third-party locations. Once national counsel has an idea of how the company maintains its documents, a comprehensive litigation hold should be prepared that encompasses the various sources of documents and data that will undoubtedly be discoverable in future litigation.
The litigation hold should be directed to the people in possession of relevant or potentially relevant information and documents and should instruct those people on how to protect the various categories of documents from destruction. In addition to identifying the types of documents and information that should be protected from destruction, the litigation hold should specifically identify each employee's responsibility to preserve such information from that point forward and the legal consequences of failing to do so. The litigation hold should be communicated by national counsel or in-house counsel, or both, to all company employees and executives by formal letter and in person so that the people responsible for ensuring that documents are preserved fully understand their duty and can ask any questions that they have about how to comply with their duty. National counsel should work with in-house counsel or other company employees to revisit the issue of document preservation on a quarterly basis and to identify and protect additional categories of documents that are later identified as relevant and discoverable. Additionally, in-house counsel should track employee compliance with the litigation hold and address any concerns regarding intentional or unintentional destruction of relevant documents and information.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.