Thirteen Unlucky Litigation Myths by Nigel Parker

January 20, 2014

Thirteen unlucky litigation myths…

 

1. “Offering to negotiate is a sign of weakness” – This relies on guessing how the other side will respond to an offer of negotiation. The only reliable indicator of weakness is weakness itself. The purpose of litigation is not to appear strong, but to resolve a commercial dispute. If the other side offered to negotiate, would that be a sign of weakness, or self-confidence?

Example: A highwayman approaches you armed with a revolver. “Your money or your life!” he says. Does this offer to negotiate indicate weakness? He could shoot you first, and then take your money anyway.

 

2. “The longer we pursue our case, the better the outcome will be” – This assumes your opponent will pay more to get out of the case, after it has been going some time. What if the other side is proceeding on exactly the same basis? You can’t both improve your chances of success by pursuing litigation. Knowing when to settle, and when to press on, is the hardest job in litigation, and there are no easy answers.

 

3. “We would lose too much face if we backed down”– How much more face might you lose after spending a fortune fighting a flawed case and losing in the end? Sometimes it’s wiser to cut your losses.

 

4. “Never show the other side your evidence, because that will allow them to prepare an answer to it” – If the evidence is strong enough to win the case, it may be strong enough to convince the other side to settle, or abandon their claim altogether – but only if you let them see it.

 

5. “If we throw enough money at it, we can create a really strong case” – Only if there is a strong case to start with. How much is “enough”? Is your spending really just papering over the cracks in a hopeless case, in the hope of coaxing a settlement out of the other side before they become aware of its weaknesses?

 

6. “But it’s a point of principle” – This is a sign that rational thought has been abandoned. Lawyers should probably be banned from acting for clients who want to fight cases on a point of principle – it would certainly save a lot of heartache later on.

 

7. “It will set a precedent”– Yes, but… only if it goes to the Court of Appeal, and precedents are not much help if you lose.

 

8. “Litigation will discourage others” – Yes, but… usually only if you win. If you lose, it may be a positive encouragement to other litigants. Litigation only works as a deterrent if it becomes a matter of routine policy, and is widely publicised.

 

9. “If we win we will get our costs paid by the other side” – Yes, but…you will only get a small proportion of your costs. You may have to fight lengthy proceedings, arguing over how much of your costs were reasonable. You may lose, in which case you will have to pay a lot of the other side’s costs.

 

10. “If we get an award of damages, it’s free money” – Yes, but…what does it cost you in irrecoverable costs and management time to get the damages?

 

11. “If we write enough correspondence they will realise their case is hopeless and give in”

– Parker’s Law of litigation correspondence: After the first letter, the usefulness of litigation correspondence is in inverse proportion to its length.

Lengthy correspondence is expensive and rarely makes progress. A settlement proposal beats a legal argument. If the correspondence is not moving towards settlement, it is a complete waste of time and money.

 

12. “A court decision will be final”- Yes, but…bear in mind the possibility of an appeal, the problems of enforcement of the court’s orders, and arguments over costs.

 

13. “We are going to win” – The biggest myth of all – remember, that’s what the other side is thinking.

 

A version of this article appeared in Nigel Parker’s book “Music Business” published by Thomson Sweet and Maxwell

 

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