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Reports from the Field on Offers of Judgment



Fellow Atlantan Ken Shigley has a blog for his motor carrier liability practice and has made some interesting comments on Georgia's offer of judgment rule.

He writes:

I have begun to hear anecdotal reports of insurance companies using low offers of judgment effectively in small soft tissue injury cases. In those small cases and particularly with lawyers who handle high volumes of small cases, the intimidation factor provided by the new OCGA Section 9-11-68 can be substantial.
At the same time, I am not seeing or hearing of much use of offers of judgment by insurers in larger cases or in dealing with well established trial lawyers. In meaty cases with serious injuries or wrongful death, I am hearing rumblings that insurers and defense firms are concerned that the offer of judgment statute could cost them money, so they aren't using it much at this point.
At the same time, I am beginning to hear reports of strong, well-established plaintiffs' lawyers making well-reasoned offers of judgment early in cases, and coupling them with demands for prejudgment interest under the Unliquidated Damages Interest Act.

What makes this especially interesting is that it undercuts the doom-and-gloom claims of the plaintiffs' bar in Georgia that came out during the debate over S.B.3.

Opponents of reform went so far as to say that the passage of the tort reform bill was the "darkest day in the history of Georgia", prompting others to quip that certainly the darkest day must have been somewhere in the mid-1860s.

Even after the bill passed, the Fulton County Daily Report carried a column from a trial lawyer bemoaning an insurance company defendant's use of the offer of judgment rule to coerce his client into a settlement of a $100,000 case for only $80,000.

Claiming that "strong, well-established plaintiffs' lawyers" are able to use the offer of judgment rule to their advantage is something I predicted in Out of Balance but it's gratifying to hear a plaintiffs' lawyer say it as well.

In the same way that the rule creates leverage to settle weak cases, it also can be used to create leverage to settle strong cases. If the defendant perceives a high likelihood of liability in the range of $X and the plaintiff makes a settlement offer of N% of $X, a defendant would be foolish not to consider seriously the offer.

 

 


Rafael Mangual
Project Manager,
Legal Policy
rmangual@manhattan-institute.org

Katherine Lazarski
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.