Colorado Business Litigation Lawyer Blog

Lead lawyers in the class actions filed against Toyota in Colorado and across the country are adding claims that the vehicle manufacturer is guilty of racketeering under the Racketeer Influenced and Corrupt Organization Act (RICO).

Plaintiffs in the initial class actions claim that the resale value of their Toyotas has decreased because of problems of unintended acceleration that prompted the recall of millions of Toyota vehicles. If successful, this theory of damages could cost Toyota as much as $2 billion.

The lawsuits allege that Toyota knew of the unintended acceleration problems-- possibly as far back as 2002-- but Toyota nevertheless continued to advertise its vehicles as safe and reliable and concealed the problems from the public. If the RICO claims are proved, damages could approach $10 billion.

Support for the RICO claims is allegedly based upon Toyota documents and the congressional testimony of Toyota officials. Toyota has declined to comment on the litigation to date.

Continue reading "Toyota Guilty of Racketeering?" »

A December study by the legal consultancy firm of Altman Weil showed that the recession notwithstanding, some large law firms are raising their fees to corporations by an average of four per cent in 2010. It is unknown whether or not Colorado law firms were included in the study.

The hourly rate charged by senior partners in these large firms has gone as high as $700-$900 per hour. A local survey by Boston-based BTI Consulting in October disclosed that 15% of Boston’s law firms are raising their rates for 2010, while the remainder is keeping their fees the same as last year.

As I have written before, a corporation that is cost- conscious and result- oriented should look at the advantages of hiring a plaintiff’s firm that charges on a contingent fee basis, whereby legal fees are based upon a percentage of the amount recovered in a lawsuit. If the lawsuit is lost, the lawyer receives no fee. Of course, this type of fee arrangement is normally confined to instances where the corporation is suing another person or legal entity for monetary damages. If the corporation is the defendant in the case (the one being sued), contingent fees are usually not appropriate, although some plaintiff’s firms will fashion a fee agreement whereby the lawyer is paid based upon results in the case.

A corporation or other entity that is considering filing a suit for money damages should feel free to contact this firm for additional information on the various types of legal fee agreements available.

Related postings:

Why You Need a Contingent Fee Lawyer for Your Colorado Business Litigation

Why You Need a Contingent Fee Lawyer for your Colorado Business Litigation, Part II

On January 29, 2010, a Boulder County, Colorado jury awarded $37 million to Jennifer Latham of Lafayette, Colorado, whose health insurance was canceled after the woman sustained severe injuries in an auto accident, including multiple fractures and a brain injury.

Latham had purchased a health insurance policy from Assurant Health just five months before the 2005 accident. After she spent a month in the hospital and another month in rehabilitation at a cost of about $185,000, Assurant Health canceled her policy and refused to pay her medical bills, claiming that Latham had failed to disclose in her application an emergency room visit for shortness of breath and treatment for a uterine prolapse. Latham claimed her insurance company acted in bad faith. The jury agreed with Latham.

Assurant Health was one of the companies investigated by the House Subcommittee on Oversight and Investigations for its policy cancellation practices.

It is not known if Assurant Health will appeal the verdict.

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.