Colorado Business Litigation Lawyer Blog

More and more Denver businesses are recognizing the opportunities for hiring a plaintiff’s injury lawyer on a contingency fee basis for their business litigation needs. These high risk/high reward cases are being handled by injury lawyers because Colorado businesses understand that their recoveries will be maximized by seasoned litigators.

Business litigation in Colorado follows a national trend. The following are examples of decisions by corporate counsel to hire injury lawyers for high risk/high reward litigation:

A personal injury lawyer in Florida was used in a securities fraud suit against an investment bank. The injury lawyer obtained a $1.4 billion dollar verdict.

A New York personal injury lawyer is representing an insurance company in litigation arising out of the September 11, 2001 destruction of the World Trade Center. Suit is against an airline and airport security to recoup costs paid out for losses covered by insurance.

A plaintiff’s injury lawyer in Illinois has formed a business-to-business relationship with a commercial litigation firm. The relationship will represent businesses on a contingency fee basis.

One of the early stories of this trend was reported in an excellent article published in the National Law Journal, July 12, 2005. The reporter cited a number of examples of businesses who make the switch from commercial litigators to injury lawyers.

Traditionally, most business-to-business lawsuits were handled by full service law firms charging by the hour. Hiring an injury lawyer was considered taboo. The injury lawyer just didn’t have the accounting, tax, patent or commercial background needed. This is a myopic decision by businesses who think that a trial is nothing but discussion of technology. These businesses have overlooked the fact that jurors themselves have no background at all in the technology. However, the jurors and the injury lawyer all understand the importance of a good story.

Rising legal fees have caused businesses to examine their litigation strategies. They are now looking to lawyers to share some of the risks.

Businesses also know that a courtroom savvy plaintiff’s injury lawyer knows how to try cases. The plaintiff’s injury courtroom lawyer is experienced in simplifying complicated issues. For example, the courtroom injury lawyer may never have been to medical school or mechanical engineering school, but certainly knows how to tell a medical malpractice story or auto defect story.

One prominent injury lawyer is of the opinion that businesses are chasing injury lawyers to handle their litigation and that tort reform has nothing to do with those decisions. That attorney repeats what corporate counsel in Colorado and nationally are saying, “All of a sudden, the negative connotations that have been directed to contingent fee lawyers over the last decade seem to have been overcome.”

A New York aviation and personal injury lawyer says, “Contingency fees are very attractive for companies that are trying to control their litigation costs. A contingent fee lawyer only gets money if he wins.”

At least one defense attorney feels that plaintiff injury attorneys are winning businesses over because of the lucrative verdicts they get, which are often impressive.

Some businesses form relationships with injury lawyers for a specific case based upon a mix of contingency fee and hourly fee. Additional arrangements require the business to cover the costs of litigation. However, a Colorado business seeking an attorney to share the risk never chooses to pay the attorney a straight hourly fee. There is at least a mix of hourly and contingency.

Corporate counsel knows that the plaintiff’s injury lawyer has a certain mindset – one that optimizes time and money, as opposed to the reactive posture a traditional commercial litigation firm takes.

I have devoted my career to winning high risk and complex litigation. I would be pleased to talk to you about how I may be able to assist your business with its litigation needs. Please contact me to setup a free initial consultation.

When someone mentions “insider trading”, Colorado residents may think of Joe Nacchio and Jeff Skilling. These gentlemen are examples of highly paid and high powered corporate executives who don’t need to guess at how the shares of their company will be valued. They do not need to guess whether the value of shares will go up or down. They know things the rest of us do not know. For example, they know whether their companies can expect substantial losses in the next quarter. If the forecast is gloomy, they sell their stock now (high) rather than wait (low). They trade stock on the basis of information known to the company insiders.

Last week, though, CBS News reported the story of stock regulators who used confidential and secret information gleaned from their regulation duties to profit and advise family and friends to profit from insider information. Kind of like putting Dracula in charge of the blood bank.

According to CBS, two SEC attorneys are under active criminal investigation by the FBI for trading stocks based upon insider information. The accusations against these attorneys are contained in a report by the SEC Inspector General. It is based upon a review and analysis of e-mail and brokerage records. Ironically, the SEC’s Inspector General uncovered a possible fraud with its own employees but failed to detect the $60 billion dollar Bernie Madoff Ponzi scheme.

One attorney under investigation works in the office of the SEC’s chief counsel and has access to a substantial amount of non-public information. In other words, information known only to the regulators and not the general public. Of course, the dupes in all of this are the average investors.

The other attorney under investigation works in the SEC enforcement division. Each of these attorneys traded in the stock of a large financial services company despite being told by another SEC employee of ongoing investigations of that company.

These two attorneys acted like they were entitled to use this non-public information at the expense of the taxpayers who were paying them. One attorney sent e-mails from his SEC account to his brother and sister-in-law recommending particular stocks. His stock portfolio at one point was valued at $200,000.

As to the other attorney, two months before an investigation of a large health care company, she sold all her stock in the company. Shrewd financial decision or thievery? Also, two days before an inquiry was opened by a colleague in the office next to hers, she sold stock in the oil company subject of the inquiry. Shrewd investment strategy or pure thievery?

The female attorney traded stocks 247 times between January 2006 and January 2008. Her stock portfolio at one time was valued more than $170,000.

One of the sources of information was another SEC employee who told investigators that these two attorneys told her to buy stock in a company, despite their knowledge of multiple ongoing investigations of that company. That was a blatant violation of SEC rules.

Guess what? Both attorneys are still employed at the SEC earning healthy six figure salaries. Of course they deny wrongdoing and may suggest that they were just smart investors. Some court will ultimately determine whether they are smart investors or smart thieves.

Small comfort that the SEC has now hired a compliance officer and has strengthened rules governing the reporting of trades by SEC employees. How can we trust the regulators to uncover criminal frauds like Bernie Madoff when the regulators are busy feathering their own nests with profits from their criminal activities?

Two years ago, a fire at the Georgetown Library in Washington, D.C. destroyed historical documents and expensive artwork. The fire occurred while the building was being renovated. Library employees arriving at work the morning of the fire remember seeing fire in the middle of the roof and assumed that’s where the fire began. Later, the fire pattern led investigators to conclude that the “origin” of the fire was actually in the area of some second floor exterior windows.

Like many other repositories of historical materials and expensive paintings, the Georgetown Library chose not to have a fire suppression system such as sprinklers. The chief librarian said it was not uncommon for buildings holding delicate documents and art to forego sprinkler systems because the water from such systems causes more damage to the expensive materials than smoke does. In crowded public buildings, such as nightclubs, theaters and restaurants, fire suppression systems are essential to protect against death and injuries.

However, the library did have smoke detectors that were operable the morning of the fire. Because the building was unoccupied, though, the efficacy of any warnings from the smoke detectors depended upon how quickly the fire department responded to the alarm. Smoke detectors are critical warning devices for buildings that are occupied such as residential and public assembly buildings. They are needed to protect against loss of life and serious injury.

Because of the lack of sprinklers in the library itself, the responding firefighters had to rely on the city’s fire hydrants for the water needed to put out the fire. It turns out that precious minutes were wasted because the two closest hydrants were inoperable. Firefighters tried hooking hoses to those hydrants including one just across the street from the blaze, but were unable to draw water. They ended up using hydrants about two blocks from the burning library. The extra time for this distant hookup prevented a more efficient fire suppression. A later investigation report identified 53 hydrants in the city in need of repair or replacement. Some leaked; some had defective parts, some had no water.

After the delayed suppression of the fire due to inoperable fire hydrants, the investigators were able to enter the fire scene and begin their investigation. They noticed fire patterns along the exterior of the second floor consistent with origin of the fire in that area. As they began to collect evidence in the area of origin, they noticed charred electric heating guns and cans of flammable chemicals. Based upon this evidence, the fire investigators doubted the general contractors’ claims that no heating guns were being used to remove paint from the windows. The general contractor said wire brushes were being used.

The District of Columbia, owner of the library, sued the general contractor for its negligence in removing lead paint from the second floor windows with faulty heating guns in the presence of highly flammable materials.

During a typical fire investigation, investigators seek to identify the origin of the fire, and then its cause. After origin and cause are determined, the investigators then assign responsibility.

For example, responsibility for the substantial destruction of the Georgetown Library focused on the following:

Fire Hydrants
International Fire Code, App. C101-App. C105
NFPA 921

Smoke detectors
International Fire Code
International Residential Code for One and Two family dwellings
NFPA 921

Sprinkler systems
International Building Code
International Fire Code
International Residential Code for One and Two family dwellings
NFPA 921

Wiring
International Building Code
International Fire Code
National Electrical Code
NFPA 921

Electric heating devices
International Fire Code
International Building Code
Underwriters Laboratories Standard UL 499

Combustible materials
International Fire Code
NFPA 921
National Electrical Code
International Residential Code for One and Two family dwellings

Flammable chemicals
International Building Code

Continue reading " Anatomy of a Fire investigation: Georgetown Library Fire (April 30, 2007) " »

In my blog a few days ago, I explained why fires are among the most destructive – and deadly – man-made catastrophes; how, in a few minutes, a building can go from a few flickers of flame to a total fire-charred rubble. I also provided some examples of public assembly buildings burned to the ground killing and injuring hundreds. In my next blog, I will take you through a typical “origin and cause” investigation designed to help expose those who are potentially responsible for the fire-caused destruction of buildings and loss of life.

For now, though, let’s look at the steps we can take to protect ourselves if our home catches on fire. How do we increase our chances of survival?

Step 1. Make sure your family has a plan. Because fires develop so quickly, you may only have a few minutes before your family is surrounded and overcome by smoke and flames. For each room in your house, know the best escape route, and have as many escape routes from each room as you can. If the escape route is through a window, made sure it is not stuck shut. Also, make sure escape is not prevented by security bars.

Step 2. Discuss with your family and practice your escape. This may require more than one escape route. Make sure everyone is comfortable feeling their way around each room in the dark. You must not only see the escape exit, but must be able to feel your way along to the exit.

Step 3. Don’t waste precious time by trying to retrieve personal property. You can replace the jewelry but not a family member.

Step 4. If a door is too hot to touch, don’t open it. There is a reason it’s hot and its spelled F-I-R-E. Go to another exit. If you open a door and flame and smoke pour in, close the door immediately.

Step 5. Once everyone is out of the house, never go back in. There are many examples where the loss of life was because someone successfully escaped only to return inside to grab a piece of personal property or a pet.

If you’re in a public building where a fire starts, things can get a little dicier, mainly because you are not as familiar with the escape routes. The main thing is not to panic. Remain claim. Know where the exits are and get to one of them quickly, but avoid a stampede. In a hotel, if there is smoke in the hallway, return to your room. That means you must grab your key before you leave the room.

When perusing fire litigation claims (such as wrongful death, catastrophic burn injury, property damage, or business interruption claims), it is crucial to hire an attorney who is experienced in this area. Whether you are seeking superior legal representation, or you are not even sure if you have a case, I would be pleased to hear from you. I will gladly evaluate all possible cases at a complimentary consultation and I am always happy to answer any questions you might have. If you would like more information on how I can assist you, please contact me.

Sources:
National Fire Protection Association,” Fire Loss in the U.S. 2007 and USFA's Firefighter Fatalities in the United States in 2007.”
“Get Out Safely! A Factsheet on Fire Escape Planning,” The U.S. Fire Administration, March 2006