How to Manage Litigation, Select Defense Counsel and Establish Litigation Budget

Managing Your Litigation

Sometimes despite the adjuster’s best effort to control the claim and to settle the claim fairly, the employee and/or the employee’s attorney is motivated by greed to pursue a settlement higher than is properly justifiable. If your insurance carrier or TPA is large enough, they should have a litigation specialist who takes over the file when it moves into litigation, If not, the adjuster will continue to handle the file. Either way, your Risk Management Department workers’ compensation coordinator or your in-house counsel needs to oversee the activity of the litigation specialist or adjuster. It’s YOUR money, so YOU should set standard protocol for how you want your litigation handled. Don’t be shy about putting your protocol in writing.

Selection of Defense Counsel

Proper selection of defense counsel is critical. The attorney selected must be an expert in workers’ compensation. The adjuster’s office probably has a list of preferred defense counsel. While all the attorney’s on the adjuster’s list are probably qualified attorneys, many of them are on the adjusters list due to the business relationship they have built with the adjuster’s office over the years. You need a defense attorney who obtains the best results, not the attorney who hosts best golf outings or the best Christmas party.

To find the best workers’ compensation defense counsel, look for attorney selected and listed by Super Lawyers.com. The lawyers listed are recommended by their peers as the best in their specialty. Only the top five percent of each specialty are selected for listing.

Other ways to find an excellent attorney is to find out who is on the state bar association’s committee on workers’ compensation and identify those attorney’s who are published authors on workers’ compensation. Also ask others in your field. The claims representative at your insurance broker or agent may be able to recommend defense counsel. Make sure you are in the position to select your own defense counsel. Make sure this is in your account handling instructions.

Going to Trial: Litigation Budget

Too often the adjuster becomes so focused on not settling the claim for the plaintiff attorney’s demand focus on the big picture is lost. If you save $10,000 on the settlement cost by aggressively defending the claim, but spend $25,000 in defense costs doing so, you may have won the battle but lost the war. To minimize the potential for this mistake, the adjuster should require the defense attorney to provide a litigation budget. (workersxzcompxzkit) HOWEVER, many companies have policies against settling litigation for defense costs unless the claims are legitimate because it sets them up for future frivolous claims. They become an easy target for claimants who know how to scam the system.

The initial referral letter requests the defense counsel to provide recommendations on any issues in dispute and requires defense counsel to provide a budget for handling of the case. With the litigation budget provided by defense counsel the adjuster is able to estimate and compare the cost of going forward with the defense of the claim to the cost of paying of an additional amount to settle the claim.

WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
TD Calculator: www.ReduceYourWorkersComp.com/transitional-duty-cost-calculator.php

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers’ comp issues.