Better Litigating Through Pre-Trial Agreements
Clients and commentators often criticize the pace, burden, and expense of litigation, principally discovery. They are right. Many lawyers seem to engage in discovery for the sake of engaging in discovery. Opposing counsel fight bitter fights over discovery issues that have no bearing on the results of the case. All too often, the fruits of discovery turn out to be wasted – unused or unusable at trial.
Too often, at the beginning of a new case, lead counsel will turn over discovery and other pretrial work to junior attorneys who do not have the judgment to know what is important, or who are afraid of not turning over every rock. The junior attorneys will mechanically go about the task of asking for every document, noticing the deposition of every witness, and asking every conceivable question at the depositions. They will get cross-wise with their opposing counsel, and silly discovery disputes will abound.
This is a problem for everyone involved in litigation.
For the client which is paying its attorneys by the hour, the cost of inefficient discovery comes right out of its pocket. For corporate defendants, the burden and cost of discovery can contribute to the desire to settle, even when settlement is not warranted.
The cost of inefficient discovery can be an enormous burden for contingent-fee attorneys. Time-consuming discovery disputes are – or at least should be – anathema to the contingent-fee lawyer who profits from handling cases efficiently.
For the hourly lawyer, protracted and costly pre-trial proceedings may seem like a boon. But it’s not. Hourly clients first and foremost look for attorneys who can efficiently handle their cases. They are not likely to rehire the lawyer who bills hundreds of hours towards taking dozens of depositions which are left on the cutting room floor when trial arrives.
Some commentators have suggested that discovery is inherently burdensome under the rules as they exist in American courts. They assert that the court system can be “fixed” only by radical alteration of the rules which permit “runaway discovery.” That’s wrong. The Rules of Civil Procedure do not require attorneys to take dozens of depositions or to file motions to compel over every document. And lawyers can make their own rules – pre-trial agreements – which enhance the efficiency of each case.
Lead counsel (not junior associates) should discuss pre-trial agreements at the very beginning of the case, before discovery picks up steam. At Susman Godfrey, we have fifteen discovery agreements which we propose at the beginning of most cases, as well as a few agreements relating to pre-trial motion practice and trial. Our experience has shown that these agreements work to reduce the cost and burden of litigation while keeping the focus on the eventual trial of the case. The key has always been to attempt to reach agreement on as many of these items before discovery begins. Once you are in the heat of battle, what appears to be good for one side is often deemed to be bad for the other – making it hard to reach an agreement.
1. Discovery Disputes Will Be Resolved with a Phone Call Between Lead Counsel.
One of the most counter-productive litigation activities is the discovery dispute letter. Lawyers write these multi-page, single-spaced tomes not for the purpose of working out discovery disputes, but to create a record for an eventual motion to compel. Such a letter typically generates a response in kind from opposing counsel, and then a reply, then a sur-reply. In short, the parties draw battle lines instead of working toward an agreement.
Counsel should not engage in discovery disputes for the purpose of engaging in discovery disputes. Instead, counsel should raise a discovery issue with the other side only when it involves documents or testimony which are really needed for trial of the case. It is always more efficient to obtain such evidence by agreement than by motion. An agreement is also a quicker and more certain method of obtaining evidence.
If your goal is to get evidence quickly and efficiently, then you should eschew letter-writing and the posturing that goes with it. A phone call typically will bring much better communication, more civility, and better results than an exchange of letters.
The phone call should be between lead counsel. More experienced lawyers are simply more capable of quickly sorting out what’s important from what is not.
2. Depositions Will Be Taken by Agreement and Will Be Limited in Number and Length.
Some counsel try to gain an advantage by unilaterally noticing depositions or by overstrategizing the issue of whose witnesses will be deposed first. These issues tend to waste time while having no impact on the outcome of a case.
The parties should agree at the beginning of the case that depositions will be taken by agreement, with no unilateral deposition notices. Moreover, the parties should agree to alternate witnesses – plaintiffs’ witness first, defendants’ second, plaintiffs’ third, defendants’ fourth etc.
Lawyers tend to take too many depositions and spend too long with each witness. In a typical commercial case, 99% of deposition testimony ends up on the cutting room floor by the time of trial. There rarely are more than a handful of truly important witnesses in any case. And there is almost never a need to spend more than six hours questioning a witness. So, we typically propose at the beginning of the case that the parties agree to limit themselves to ten depositions each, with each deposition no more than three hours in length.
Many jurisdictions are moving towards limiting deposition length. In the late 1990’s, Texas changed its rules to adopt a limit of six hours of questioning per side. The result has been more efficient and more focused litigation. But even six hours is unnecessarily long for most witnesses. For most witnesses, there simply is no reason to question them for more than half a day.
3. No Objections at Depositions.
Many jurisdictions are moving towards rules that prohibit counsel from asserting deposition objections other than privilege objections and “objection, form.” These rules have had the very positive effect of cutting down on speaking objections. Speaking objections waste time, frustrate the questioner, make litigation more contentious, and make the witness and his counsel look bad.
We like to go one step beyond the limitations in the rules. At the beginning of the case, the parties should agree that at depositions, all objections to relevance, lack of foundation, non-responsiveness, speculation, or to the form of the question will be reserved until trial. There will be no reason for the defending lawyer to say anything other than to advise the client to assert a privilege or to adjourn the deposition because the questioner is improperly harassing the witness. If counsel violate this agreement, the other side can play counsel’s comments or objections to the jury at trial.
4. The Parties Will Share the Same Court Reporter and Videographer.
Counsel often fail to cooperate on the selection and negotiations with a court reporting firm. This is a mistake. The parties can easily cooperate to choose a court reporting firm at the beginning of the litigation. If counsel can promise the firm that it will handle court reporting and videography for every deposition in the case, the firm should be willing to provide a discount in return for the right to transcribe all depositions. Counsel can also cooperate to solicit competitive bids from multiple court reporting firms. This cooperation at the beginning of the lawsuit can save considerable money for clients.
5. Papers Will Be Served by E-Mail on All Counsel.
Some lawyers still do not serve papers by e-mail unless required by the rules. Their reluctance may in some circumstances be motivated by misguided tactical considerations; they want their opposing counsel to go a few days without realizing that an important motion has been filed. This is particularly a problem in state-court jurisdictions where there is no e-filing.
Such tactical maneuvering does not yield a better outcome at trial. It is unnecessary and counter-productive. The parties should agree at the beginning of every case that all papers will be served by e-mail as soon as they are filed.
It also is a good idea to agree at the beginning of the case that all filings will be served by e-mail on all counsel and legal assistants. It is more efficient for everyone on the trial team to learn immediately of any filings. Moreover, if the parties agree at the beginning to send all emails to all members of the other side’s team, lead counsel can spot a fight brewing and intervene to resolve it before it gets out of hand.
6. Documents Will be Produced on a Rolling Basis.
There is no real advantage to be gained for either side in posturing over when documents will be produced. And delays in document production can only lead to inefficiencies and fights about collateral issues.
The parties should agree to produce documents on a rolling basis as soon as they have been located and copied. If copies are produced, the originals should be made available for inspection upon request.
One commendable procedure is used in the United States District Court for the Eastern District of Texas. In that district, judges expect the parties to produce all relevant documents at the beginning of the case as part of initial disclosures. The parties can of course exchange additional requests and produce additional documents as the case moves along, but this early production of the key documents in the case helps the parties to focus on the important issues and conduct more efficient discovery.
7. Each Side Will Pick Five Custodians for Production of Electronically-Stored Records.
Electronic discovery has become the most expensive and time-consuming part of the pre-trial practice in most cases. But pre-trial agreements can help to reduce the burden.
Electronic discovery is so burdensome because requesting parties seek overbroad production of electronic documents, and because producing parties try to conduct a relevance and privilege review of every single electronic document. In some large cases, each side will end up having several young lawyers spend weeks on end conducting relevance reviews of dozens of custodians’ electronic files. This is extremely expensive, and not terribly useful.
Parties can greatly reduce the burden and hassle of producing electronically stored information by focusing only on those custodians who really matter. Moreover, the parties can agree not to conduct a time-consuming relevance review prior to production.
In our cases, we like to propose that each side must initially produce electronically stored information from the files of five custodians selected by the other side during an agreed period of time. Only documents which have a lawyer’s name on them can be withheld from production, and only then if they are actually privileged. Production does not waive any privilege, and documents can be snapped back whenever the producing party recognizes that they are privileged. After analyzing the initial production, each side can request electronic files from five other custodians. Beyond that, good cause must be demonstrated.
This procedure gives both sides the assurance that, in all likelihood, they will not have to gather electronic documents from more than ten custodians. It also gives both sides the assurance that the other side cannot withhold documents because of obscure or unfounded relevance objections. The parties will simply screen out electronic documents that list lawyer names, determine whether the screened-out documents are actually privileged, then produce what is not privileged.
One objection we sometimes hear is that some cases have more than ten relevant custodians per side. The parties can always ask the Court for electronically stored documents from more custodians. But from our experience, that rarely is necessary. When is the last time that the key email in your case was neither sent to nor received by one of the top ten most important witnesses on either side of the case? In our experience, ten custodians will usually be more than enough to capture the relevant documents.
8. Production Does Not Waive the Privilege.
One of the major hindrances to quick and efficient production of documents is most attorneys’ fear of producing privileged documents. This fear can lead to overly long and detailed privilege reviews and production of massive privilege logs.
The case law on waiver of privilege can be an obstacle to efficient document production. Counsel fear that if they let one potentially privileged document slip into their document production, they will then be faced with an argument for a very broad waiver.
Some jurisdictions permit snap back of privileged documents, but snap back rules sometimes are structured in a way that limits protection against waiver arguments. For example, in some jurisdictions, privileged documents can be snapped back only if their production is “inadvertent.” Sometimes counsel are over-inclusive when claiming privilege, because they do not want to later bear the burden of showing that production was inadvertent.
To deal with these concerns, the parties can agree at the beginning of a lawsuit that the production of a privileged document does not waive the privilege as to other privileged documents, and that documents can be snapped back as soon as it is discovered they were produced without any need to show that the production was inadvertent.
For additional protection, if the case is in federal court, the parties can request an order at the beginning of the case under Fed. R. Evid. 502(d), which provides that “a Federal court may order that the privilege or protection is not waived by disclosure connected with the litigation pending before the court – in which event the disclosure is also not a waiver in any other Federal or State proceeding.”
9. Each Side May Select up to 20 Documents from the Other Side’s Privilege Log for In Camera Inspection.
As document productions have gotten larger in complex cases, so have privilege logs. It is not all that unusual anymore to see privilege logs in excess of 100 pages. When faced with such a log, we have found that the best practice is to select 20 documents which, based on the log descriptions, appear to be the most relevant documents to which there potentially is not an applicable privilege, and request the Court to determine whether there is an applicable privilege. Therefore, we suggest agreeing at the beginning of the case that each side has the right to select 20 documents from the other side’s privilege log for submission to the Court for in camera inspection.
10. The Parties Will Produce Electronically Stored Information in Native, Searchable Form.
The parties should work in good faith to make sure that their electronically stored information (ESI) is useable by the other side. To that end, the parties should agree at the beginning of the case that, whether in federal court or not, they will produce ESI in the native format kept by the producing party, or in a common interchange format, such as Outlook / PST, Concordance, or Summation, so that it can be searched by the other side. If any special software is required to conduct a search in native format and is regularly used by the producing party, it must be made available to the other side. The parties will produce a Bates-numbered file listing of the file names and directory structure of what is on any CDs or DVDs exchanged. Either side may use an e-mail or an attachment to an e-mail that came from one of these previously produced disks by printing out the entire e-mail (and the attachment if they are using a file that came with an e-mail) and marking it at the deposition or trial, and either side may use application data (which was not an attachment to e-mail – so it’s stand-alone on a CD or DVD) as long as the footer on the pages or a cover sheet indicates (1) the CD or DVD from which it came, (2) the director or subdirectory where the file was located on the CD or DVD, and (3) the name of the file itself including the file extension.
11. The Parties Will Ask the Court to Choose a Protective Order.
Sometimes discovery is bogged down from the very beginning when the parties cannot agree on the form of a protective order. This is particularly a problem in patent infringement cases and other big-stakes matters involving sensitive business information.
Sometimes the parties will negotiate a month or two trying to reach agreement on the language of a protective order, to no avail. When that occurs, the parties have wasted several weeks and their clients’, or their own, time and money.
Most judges have a good sense of what they think should and should not be in a protective order. Rather than negotiate for weeks then submitting the dispute to the judge, the parties should put a 48-hour limit on protective order negotiations.
The parties should exchange protective order proposals. Then, they should negotiate. If agreement cannot be reached on the form of a protective order within 48 hours of the time when the proposals are exchanged, both sides will write a letter to the Court including each side’s preferred version and, without argument, ask the Court to select one or the other as soon as possible.
Agreed protective orders, like most agreements, tend to get done if there is some pressure to get them done. The 48-hour deadline puts maximum pressure on the parties to reach an agreement and begin the real work of putting together their case. If the parties fail to reach such an agreement, the Court can quickly decide which form of order is best without enduring tedious argument from counsel.
Each court can reduce the time spent on protective orders if it will have a standard protective order which it presumptively enters in each case. The Court can make it clear that there is a very high burden on anyone wants something different.
12. Exhibits Will Be Numbered Sequentially.
It becomes apparent that many litigators are not thinking about trial when they start numbering deposition exhibits. It is a particularly annoying practice to number exhibits separately for each deposition. When this is done, the same document can end up being Smith-1, Jones-4, and Johnson-14 once the parties get to trial. Alternatively, the plaintiffs and defendants can continue the numbering from deposition to deposition but have a separate set of plaintiffs’ exhibits and defendants’ exhibits. Plaintiffs-14 and defendants-14 then will be different documents.
Exhibits should be numbered at deposition with the ultimate goal in mind – trial. Each exhibit should have one and only one number, which it will carry through trial. This practice greatly reduces confusion over exhibit numbering. It also allows the parties to more easily play at trial the deposition excerpts in which exhibit numbers are referenced.
13. The Parties Will Share the Expense of Imaging Deposition Exhibits.
Just as the parties should cooperate in selecting a court reporting firm, they should cooperate and share the cost of imaging all deposition exhibits. There is no advantage to anyone – except perhaps companies which image documents – of the parties failing to share costs in this manner.
14. Neither Side Will Be Entitled to Discovery of Communications with Counsel or Draft Expert Reports.
The parties can greatly reduce the cost of expert work and discovery by agreeing that communications between experts and counsel, as well as draft expert reports, are not discoverable. The preparation of expert reports is not nearly as time-consuming when experts and attorneys can freely communicate in writing.
We have been proposing this agreement for years, and the federal rules are now catching up. Under new Fed. R. Civ. P. 26(b)(4)(B), effective December 1, 2010, draft reports are protected as work product unless they are otherwise discoverable under the catch-all discovery “scope” provision of Rule 26(b)(1) or, under Rule 26(b)(3)(A)(ii), the party seeking production shows that it has “substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means.” And under new Rule 26(b)(4)(C), attorney-expert communications are protected except to the extent that they (i) relate to compensation for the expert’s study or testimony; (ii) identify facts or data that the party’s attorney provided and that the expert considered in forming the opinions to be expressed; or (iii) identify assumptions that the party’s attorney provided and that the expert relied on in forming the opinions to be expressed.
Many state court systems do not yet have equivalent rules, but in the few months since the new federal rule became effective, we have found that state-court litigants often are willing to agree by stipulation to apply the common-sense federal rule to their cases.
Even with the federal rule in place, it may make sense in some cases to get a broad stipulation that draft reports and attorney-expert communications are not discoverable. Such a stipulation can give the parties more assurance that the opposing side will not prevail with an argument of “substantial need” to see communications or drafts, and that the opposing side will not seek production based on a broad reading of the exception for communications that identify facts or data that the party’s attorney provided and that the expert considered in forming the opinions to be expressed.
15. The Parties Will Agree to Limited Rights to Take Expert Depositions.
If a case is in federal court, and parties provide expert reports in the manner that is required by FRCP 26(a)(2)(B), there should be no need to depose experts. It is more efficient to use the opinions and other information provided in the report to prepare to cross-examine the experts once – at trial. Moreover, it is often strategically advantageous to save the questioning for trial. Depositions often serve only to alert experts and opposing counsel to problems which can then be fixed prior to trial.
Sometimes parties do not comply with FRCP 26(a)(2)(B). The rule requires detailed and complete reports, including (among other things) “a complete statement of all opinions the witness will express and the basis and reasons for them,” “the facts or data considered by the witness in forming them,” and “any exhibits that will be used to summarize or support them.” If a report is incomprehensible or incomplete, the parties should reserve the right to depose the expert. However, the parties should agree that the party seeking clarification is required to establish its entitlement to a deposition through a motion filed with the Court.
In many state-court jurisdictions, it is the norm to provide expert disclosures rather than expert reports. Expert disclosures often are incomprehensible or incomplete. Therefore, in jurisdictions where the rules do not require expert reports, we often propose that the parties agree at the beginning of the case that the parties will provide expert reports, rather than disclosures.
In negotiating the pre-trial agreements at the beginning of the case, counsel should of course be thinking about pre-trial motion practice and trial, not just discovery. The start of discovery is not too early to begin discussing and trying to reach agreement on many of these items.
1. The Parties Should Agree upon a Briefing Schedule and Page Limits for All Pre-Trial Motions.
When it is not otherwise set by rule or court order, the parties should agree in advance for a pre-trial motion schedule and page limits. Most consequential pre-trial issues can be resolved with short briefs filed in a timely way that set out the key arguments. It is typically a waste of time to bury the Court in paper, especially with motions filed shortly before trial.
2. Demonstrative Exhibits Need Only to be Shown to the Other Side Before They Are Shown to the Jury.
A trial is a teaching process. The parties should be given maximum latitude to use whatever permissible techniques are available to teach the jurors the facts of the case. For maximum effectiveness, demonstratives typically need to be re-worked and honed up until the day they are used in trial. Therefore, the parties should agree in advance that demonstratives need only to be shown to the other side before they are shown to the jury, and need not be listed in any pretrial order.
3. The Parties Should Agree Upon a Jury Questionnaire.
In order to streamline jury selection, the parties should agree up front on a jury questionnaire to be filled out by potential jurors.
4. The Parties Will Ask the Court to Allow the Jury to Ask Questions and Keep Notes.
Imagine a class in college where you were not allowed to ask questions or take notes. The very idea is ridiculous. For obscure and unconvincing reasons, many courts continue to enforce rules which affirmatively hinder the jurors’ ability to learn and retain information about a dispute. Our court system works much better when jurors are well-informed and engaged. Therefore, the parties should agree before-hand to ask the Court to allow jurors to take notes and ask questions.
5. The Parties Will Provide the Jurors with an Agreed-Upon Notebook.
In order to further educate the jurors, the parties should agree ahead of time to prepare an agreed-upon juror notebook. The notebook can contain a cast of characters, a list of witnesses (including their photos), a neutral time line, a glossary of special terms which will be heard at trial, any crucial or dispositive documents, and other information which the parties agree will help the jurors follow the trial and deliberate in a reasoned, informed way.
Litigants, judges, juries, and lawyers all win when counsel can work together and agree on some simple rules at the beginning of a case to streamline discovery and trial. These agreements can reduce expense, stress, and many of the uncertainties that are associated with pretrial rulings and jury trials. We hope that these agreements can prove to be as beneficial in your cases as they have been in ours.