1. M ANAGING C ATASTROPHIC C LAIM L ITIGATION Richard Vincelette, President Stephen Dzury, Senior Vice President, Claims Berkley Public Entity Managers A Berkley Company

2. Catastrophic / Large Claims Litigation Management Incident Investigation Pre Suit Work Suit Response Litigation Mediation Trial Resolution O UTLINE 2

3. S ET THE TONE 3

4. Man made in origin (not Natural Cats in the Property Sense) Large Dollars Reputational Risk High Exposure Challenging Legal Issues Emerging Trends C ATASTROPHIC / L ARGE C LAIMS 4

5. L ITIGATION M ANAGEMENT Litigation management does NOT start when suit is filed, or even when an incident takes place! It starts TODAY – Panel Counsel – Guidelines – Experts – Structure Brokers – Litigation Support Vendors – Jury consultants What is your litigation philosophy? Who is your team? 5

6. T ODAY ? Who is your Heavy Hitter? Think outside the box What makes counsel a Heavy Hitter? – Political Connections? – Support Team / Staff? – Reputation? – Ability and Willingness to Try a Case! 6

7. B ETTER CALL S AUL 7

8. T HE V ALUE OF R EPUTATION 8

9. T HE I NCIDENT As soon as you are aware of an incident, action needs to be taken If there is any question, call the experts – Counsel – Engineers – Accident Reconstructionist – State Police – Crisis Management Experts Any and all physical / time sensitive evidence should be preserved as quickly as possible NOTIFY YOUR BROKER AND CARRIER 9

10. I MMEDIATE R ESPONSE Is a public response needed? Would it be beneficial? Is there a crisis management plan in place? – If so, does it involve retaining a crisis management response expert? What is said and done in the immediate aftermath will be something you will live with for the length of the case, if not longer 10

11. On July 6, 2013, an unattended 74 car freight train carrying crude oil derailed in the center of Lac-Mégantic, Quebec Destroyed 30 buildings, killed 42 people, with 5 still missing and presumed dead Montreal, Maine and Atlantic Railway owns the rail line and cars 11 M ONTREAL, M AINE AND A TLANTIC R AILWAY E XAMPLE

12. E XAMPLE ( CON T ) 12 Before: After:

13. E XAMPLE ( CON T ) CEO did not go to the site for 4 days Before an investigation started, he blamed a local volunteer fire company He then blamed the engineer (his employee) and suspended him Did not issue press releases in French (local language) Did not retain an interpreter for press conferences, appears to have used an on-line translation service Half jokingly requested a bullet proof vest when he did appear at the site Complained that this accident would likely bankrupt his company Factually misrepresented his companys safety record Promised to assist with cleanup and then refused to contribute anything Has instructed employees to not cooperate with any police investigation without first consulting in-house lawyers 13 What not to do:

14. E XAMPLE ( CON T ) After his first press conference upon arrival, these were the (nicest) responses: 14

15. I NVESTIGATION Who is going to conduct your investigation? – Should counsel be retained to create privilege? – Should other experts be brought in? What internal reports will be generated? – How will they be distributed? What is the purpose of your investigation? – To determine what happened? – To address and potentially punish the at-fault party? – To create a document to be used in defending the case? 15

16. I NVESTIGATION ( CON T ) How long will it last, and who will be involved? A timely and thorough investigation needs to be considered an investment in the outcome of the case, not an expense A failure to investigate and properly preserve all findings as soon as an incident has taken place can create significant, expensive problems that may not be fixed 16

17. P RE -S UIT W ORK What are the results of your investigation? Has counsel been assigned? What liability picture has emerged? – Is liability clear and adverse? If so, should settlement discussions be considered? Should an amount of money be offered in good faith? Should medical management be introduced on a BI case? What other items can be done to reduce ultimate exposure? If liability is not clear and adverse, play some games! 17

18. P RE -S UIT W ORK ( CON T ) Not Scrabble or Words with Friends – Utilize game theory If suit is filed, where will it possibly be filed? How will you respond? – Answer the complaint? – File a motion to remove to a different court? – File a motion to dismiss? – Tender retentions / deductibles / limits? What other variables can be gamed so that you have a plan in place when suit is filed? 18

19. S UIT R ESPONSE Now that you have game theoried most potential responses, put strategy into action – Who is plaintiffs counsel? – Whats their background? If you need an extension, ask for it The responsive pleading does not have to be automatically be an answer – Removal – Dismissal 19

20. S UIT R ESPONSE ( CON T ) The goal for discovery should be twofold: – Hold plaintiff to their proof by being aggressive in discovery – Constantly work to reduce plaintiffs case through motion practice 20

21. A NSWERING THE C OMPLAINT Analyze the Complaint – Where are they looking to drive the case? – What are the Causes of Action? Affirmative defenses can be tricky As a public entity, in a large case, the answer filed may receive significant scrutiny – How will it be received by the public, or in the media? – If filing controversial responses, do you need a media management strategy? – Is your Heavy Hitter media trained? If not, who? 21

22. L ITIGATION Responsive pleading to the complaint filed: Affirmative defenses: Discovery – where the Defense can become the Offense Interrogatories – Who will answer them for the defendant? – Will they make a good deposition witness? – Be thorough and deliberate when crafting them and propounding them on the plaintiff 22

23. Will the depositions be videotaped? Who will be the defendant deponents? – Think and put together a plan for who will likely be deposed on your side – No such thing as too much preparation – Preparation is more than having counsel spend 30-45 minutes with them prior to the depositions – Mock depositions L ITIGATION - D EPOSITIONS 23

24. L ITIGATION - D EPOSITIONS What are their backgrounds? – Know what skeletons exist before the deposition – Plan to deal with them as early as possible Deposing plaintiffs – Conduct ethical, legal background checks on those that you may be deposing Employ what you know about plaintiff Conversational approach, as opposed to adversarial, can often provide additional information 24

25. L ITIGATION – M OTION P RACTICE As discovery progresses, keep in mind plaintiffs causes of action What can be done to knock various Causes of Action out? Ideally, through discovery, the Causes of Action can continue to be whittled down, and disposed of either through: – Motion for Summary Judgment – Motions in Limine 25

26. L ITIGATION – E XPERTS Who will your experts be? How are you selecting them? What is their background? – Are there skeletons to be worried about? – Are there billing issues you will need to deal with? – What accreditations do your experts have? Industry Educational How do they relate to people? Will they relate to a jury? 26

27. L ITIGATION – J URY C ONSULTANTS Jury Consultants are best brought in early in a case Assist with Mock Trials and Focus Groups Provide helpful feedback on trial exhibits, graphics, animations Can provide an overall textural feel to a case, which is beneficial for both the mediation, and trial 27

28. F OCUS G ROUP A moderator presents a narrative to a group of people, and will then ask questions as to the groups thoughts Marketed as helping value a case Can help with trends, evaluate arguments Least expensive method of reviewing a case Highly dependent on the moderator Does not always provide most reliable data Can be subjected to too many variables 28

29. M OCK T RIALS Mini trial, usually conducted in front of more than one group of people More expensive than focus groups, but can provide better quality data May conduct 1-2 per day, so that a number of theories can be tried out Consider having defense counsel act as plaintiffs counsel – Think like a bug Use a quality opponent 29

30. M EDIATION This is where the investment will pay off Almost some form of ADR / Mediation is required, and this is a good thing What is the goal of your mediation? Who is your mediator, and how were they picked? What do you know about the mediator and their style? How do you put this to use and generate value? 30

31. M EDIATION ( CON T ) Whats the plan? – Who will participate in the opening session? – What will the structure of the day be? – Will each side do a short presentation? – Authority Make sure your structure broker is there, and engaged – Good faith – Written offers 31

32. M EDIATION ( CON T ) Who will participate in the opening session? Keep in mind that you likely have done this a bunch of times before, where the plaintiff has not It will be emotional for the plaintiff Make sure you are prepared for the day – It is emotional for all parties – There is significant down time, and small bursts of intense activity – Get as much sleep as you can the night before – Plan your meals for the day 32

33. T RIAL Appellate Counsel – Retain them – Involve them in the drafting of all motions – They should attend each day of trial, and work with defense counsel – They should review the daily transcripts independently, highlight and act on any appellate matters – Build a case, if necessary, for an appeal Motions in Limine to be argued 33

34. T RIAL ( CON T ) Have a strategy to address a pre-trial settlement conference – Do you want to request one? – Is the judge forcing one? – Has plaintiffs counsel requested one? – Do you have authority? Are you using the jury consultant at trial? 34

35. T RIAL ( CON T ) Trial attendance – Who will be sitting at the defense table? – Who else will be attending (adjuster, other interested parties) – Shadow jury Address with judge and bailiff early on Voir Dire – Do you get the list of potential jurors ahead of time? – Are there questionnaires to review? – What do you know about the juror panel that can be put to use? – Political affiliation is not the best predictor of a jurors vote – Are you using the jury consultant to assist with voir dire 35

36. T RIAL ( CON T ) As the trial progresses, let trial counsel work – No status reports – Have him or her focus on the days activities – Division of labor between trial counsel and appellate counsel Appellate counsel should be handling all motions and protecting the record – Appellate counsel needs to work with trial counsel 36

37. T RIAL ( CON T ) Plaintiff has finished their case – has plaintiff met their burden? – Motion to dismiss? – Protect the record Settlement discussions can continue through trial – As the adjuster, or representative for the defendant, engage plaintiffs counsel in settlement discussions where appropriate – Keep defense counsel out of it – let them continue to prepare and try the case 37

38. T RIAL ( CON T ) Be careful with the trash talk Act as though there is a camera on you – Jury sees and hears things – Plaintiff sees and hears things – Can have a significant outcome on how the jury ultimately responds 38

39. R ESOLUTION Youve won – Great! Will plaintiff appeal? Do you have an Offer of Judgment to collect? Use appellate counsel to handle any potential appeals Thank your team – celebrate your successes Conduct a post mortem with the team – what worked, what didnt work, what can be learned 39

40. R ESOLUTION Youve lost – My Condolences Post-trial motions – JNOV – Remititur – Do you have an offer of judgment to deal with? Appeals – Appellate counsel Post-trial settlement discussions Thank your team – the sun will rise tomorrow Conduct a post mortem with the team – what worked, what didnt work, what can be learned 40

41. F INAL T HOUGHTS The best defense is a strong offense Information has significant power The media has a powerful effect on cases in litigation Litigation Management starts today, and takes place every day, not just during a claim Win as a team, or die as individuals 41

42. T HANK Y OU Richard Vincelette, President Rvincelette@wrberkley.com +1 (215) 553-7366 Stephen Dzury Sdzury@wrberkley.com +1 (215) 553-7382 42