February 24, 2003

Strategies For Ultimate Victory in Dangerous Litigation

Laurie Webb Daniel

TABLE OF CONTENTS

I.         PRE-LITIGATION STRATEGIES: LAYING THE GROUNDWORK FOR EVENTUAL SUCCESS   

II.        THE TRIAL COURT: SHAPING THE RECORD FOR APPEAL 

A.        Begin Preparing For The Appeal As Soon As You Get The Case.  

B.        Develop Your "Roadmap."

C.        Use Your Roadmap as a Checklist for Pleadings, motions, and trial preparation.          

D.        Carefully Review the Statement of the Case and Legal Issues.      

E.        Ten Points for Preserving the Record at Trial.           

F.        Use Post-Trial Motions To Clean-up the Record.       

G.        Supplement the Record with Intervening or Omitted Material.     

III.      THE VERDICT HITS: BUSINESS CONSIDERATIONS FOR IN-HOUSE COUNSEL         

A.        Stays.

B.        The Bond.    

C.        Required Disclosures.       

IV.      THE APPEAL: HOW TO MAXIMIZE YOUR CHANCES OF REVERSAL THROUGH EFFECTIVE APPELLATE ADVOCACY       

1.         Include an appellate practitioner on your team.        

2.         Obtain advice on local practice.  

3.         Insist on an early draft.    

4.         Consider these tips on successful briefing.       

5.         Budget for thorough oral argument preparation.      

V.        THE COURT OF PUBLIC OPINION:  PRACTICAL CONSIDERATIONS FOR TURNING AROUND THE PUBLIC PERCEPTION OF CORPORATE AMERICA

 


 

INTRODUCTION

Not that long ago it was said that plaintiffs’ lawyers knew they had made it when the jury returned a $1 million verdict.  Now, they need at least a $10 million recovery to stand out.  And, $10 million is a small amount compared to the $50 and $100 million awards that are routinely reported by the National Law Journal.  You can no longer assume that the “runaway verdict” is a rare misfortune affecting only a few, unlucky colleagues.  It happens altogether too often.

Fortunately, there are ways to maximize your chances of converting disaster to victory.  These materials serve as a tool kit for in‑house counsel in need of fixing a case gone awry in the trial court.  They offer practical advice on how to lay the groundwork for a successful appeal and how to enhance your chances of reversal through effective appellate advocacy.  In addition, they address the immediate business considerations that go with a big hit, such as how to obtain a stay of judgment and ways of dealing with public relations issues.


 

I.         PRE-LITIGATION STRATEGIES: LAYING THE GROUNDWORK FOR EVENTUAL SUCCESS

One of Atlanta's high profile plaintiff's' lawyers recently told attendees at an advanced appellate seminar that the first step in the appellate process is to conduct a good pre-litigation investigation:

If you represent plaintiffs, research and think hard about the causes of action you might assert.  Which issues are most likely to trigger a summary judgment motion?  Why? You have control over when you file the complaint.  Who has access to and control over the potentially decisive evidence?  Interview and secure sworn statements from all accessible witnesses prior to filing the complaint with an eye toward discouraging the potential for summary judgment.  Get all pertinent documents that you can outside the formal discovery process. 

Albert M. Pearson, Reversing Summary Judgment: Anticipate, Vaccinate & Dominate, Institute of Continuing Legal Education in Georgia (2003).  The same advice holds true for a corporation anticipating the need to defend against a lawsuit.

Some law firms offer "rapid response teams" to assist with the investigation of a disaster.  These lawyers, who are familiar with the evidentiary standards that are necessary for establishing a successful defense, are prepared to travel to the scene of a disaster within hours of the occurrence.  By combining their knowledge of the legal issues that will ultimately govern the case with investigative experience, they can make sure that key evidence is developed and preserved, thereby laying the groundwork for eventual success in an appellate court.

Conducting a pre-litigation investigation, however, is not without risk.  Once litigation begins, the discovery of the internal, pre-litigation investigation and resulting reports often becomes an issue.

Generally, parties rely upon the work product doctrine to protect such investigations.  Rule 26(b)(3) of the Federal Rules of Civil Procedure provides:

A party may obtain discovery of documents and tangible things… prepared in anticipation of litigation or for trial by or for another party or by or for that other party’s representative…only upon a showing that the party seeking discovery has substantial need of the materials in the preparation of the party’s case and that the party is unable without undue hardship to obtain the substantial equivalent of the materials by other means.

See Fed. R. Civ. P. 26(b)(3).  The work product doctrine protects a zone of privacy within which to think, plan, weigh facts and evidence, candidly evaluate a client’s case, and prepare legal theories.  See Western Trails, Inc. v. Camp Coast To Coast, Inc., 139 F.R.D. 4 (D.D.C. 1991); Coastal States Gas Corp. v. Dept. of Energy, 617 F.2d 854,864 (D.C. Cir. 1980).  The purpose of the doctrine is to protect the integrity of the adversary trial process by shielding adversaries’ thoughts and plans concerning the case.  See Western Trails, Inc. at 9.  Although the work product doctrine is confined strictly to materials prepared in anticipation of litigation, it protects not only materials prepared by a party but also materials prepared by a representative of a party, including attorneys, consultants, agents, or investigators.

Rule 26(b)(3) does not require that a party formally file a lawsuit in order to avail itself of the protection of the work product doctrine.  See Raso v. CMC Equipment Rental, Inc., 154 F.R.D. 126 (E.D. Pa. 1994).  The party opposing the discovery need only show that the documents were prepared or obtained because of the prospect of litigation, and not in the regular course of business.  See Fed. R. Civ. P. 26(b)(3) Advisory Committee’s Note (“materials assembled in the ordinary course of business, or pursuant to public requirements unrelated to litigation, or for other non-litigation purposes are not under the qualified immunity provided by this section”).

The fact that litigation might ensue, however, is not dispositive of the question of whether pre-litigation investigative reports are discoverable. Instead, the inquiry is a factual determination of the primary reason for creation of the requested documents. See Nat'l. Union Fire Ins. Co. v. Murray Sheet Metal Co., 967 F.2d 980 (4th Cir. 1992); Binks Mfg. Co. v. Nat'l Presto Indust., Inc. 709 F.2d 1109 (7th Cir. 1982); Janicker v. George Washington University, 94 F.R.D. 648, 650 (D.D.C. 1982); Scott Paper Co. v. Ceilcote Co., Inc., 103 F.R.D. 591 (D. Me. 1984).

Simply anticipating that litigation may result from an event, therefore, does not automatically qualify an in-house report as work product.  See Soeder v. General Dynamics Corp., 90 F.R.D. 253 (D. Nev. 1980).  For example, in Soeder, the defendant conducted an investigation following the crash of an aircraft it designed.  See id. at 254.  Defendant conceded that such reports are routinely prepared after such crashes.  See id. at 255.  Aside from the possibility of litigation, the court stated that the defendant could not argue against the many reasons why the defendant would have prepared the report in the ordinary course of business in its desire to improve its aircraft products, protect future pilots and passengers, guard against adverse publicity, and promote its own economic interests.  See id. at 255.  Consequently, the court ordered the defendant to produce the report to the opposing party.  See also Simon v. G.D. Searle & Co., 816 F.2d 397, 401 (8th Cir. 1986). (concluding that the work product doctrine would not protect the risk management documents from discovery unless they were prepared in anticipation of litigation and were not prepared in the regular course of business).

            While courts have shown an inclination to find pretrial investigation reports discoverable, the courts have stopped short of requiring production of prelitigation investigation reports that include the investigators mental impressions.  See Smith v. Diamond Offshore Drilling, Inc., 168 F.R.D. 582 (S.D. Tex. 1996).  See also Duplan Corp. v. Moulinage et Retorderie de Chavanoz, 509 F.2d 730, 734 (4th Cir. 1974) ("no showing of relevance, substantial need or undue hardship should justify compelled disclosure of an attorney's mental impressions, conclusions, opinions, or legal theories"); In re Murphy, 560 F.2d 326, 336 (8th Cir. 1977) ("unlike ordinary work product, opinion work product can not be discovered upon a showing of substantial need and an inability to secure the substantial equivalent of the material by alternative means without undue hardship"). 

            What these cases show is that, even before litigation, you should carefully consider how to pursue the requisite fact-finding investigation, how to shape the case, and simultaneously minimize the possibility of the pre-litigation investigation’s findings making their way into the hands of adversary counsel.

II.        THE TRIAL COURT: SHAPING THE RECORD FOR APPEAL

        A. Begin Preparing For The Appeal As Soon As You Get The Case.

Too often, lawyers make the mistake of considering the issues for appeal only after they have lost the case in the trial court.  A lawyer who waits until receiving an adverse jury verdict before thinking of the appeal, however, likely has waived at least some arguments, perhaps even the best ones.  To ensure that your case is in the best posture on appeal, you should prepare for the possibility of appeal during every stage of the litigation.  Laying an early foundation for an eventual appeal early is never a waste of resources.  Even if there is never an appeal, it strengthens your position with respect to settlement or trial.  If the case does not settle and things turn out badly at trial, it gives you the most flexibility in framing your request for a reversal.

        B. Develop Your "Roadmap."

One of the best ways of preparing for an appeal is to develop the "roadmap" for your case.  The most effective roadmap is a thorough written analysis addressing the legal theories of the case as well as all applicable standards and burdens of proof.  You should make sure that you know from the start what defenses to plead in your answer and what evidence you will need to present to support them.  You should analyze the controlling authorities, then list each of the essential elements of your claims and defenses and the facts on which you will rely to satisfy them. 

        C. Use Your Roadmap as a Checklist for Pleadings, motions, and trial preparation.

It pays to spend the time to produce a comprehensive written analysis early in the case because the effort will provide guidance, hopefully a checklist, later on when you are preparing your discovery requests, motions, pretrial order, witness outlines, exhibits, Rule 50 motions and, if necessary, your appeal.  With the legal theories, standards and burden of proof memorialized in writing, you will have an easy reference to use throughout the case to make sure that you don't forget an important point.  Such a memorandum is particularly helpful in a case that spans years with intermittent dormant periods.

The roadmap, of course, should be updated at each new stage of the litigation to include new developments of fact or law.  Even with such updates, however, the initial analysis usually continues to provide the underlying structure for the development of the case for trial and any eventual appeal.  Indeed, much of the analysis of controlling authorities in a well crafted initial "roadmap" can be copied verbatim into a summary judgment brief and then carried forward into the appellate brief when the time comes.

        D. Carefully Review the Statement of the Case and Legal Issues.

Under F.R.Civ.P. 16, the pretrial order supersedes the pleadings and "shall control the subsequent course of the action . . . ."  It is important to remember that Rule 16 not only shapes the trial of a case by identifying witnesses and documents, it also serves to shape the issues on appeal.  Courts have strictly construed Rule 16 to bar review of an issue that was omitted from the pretrial order.  See Miles v. Tennessee River Pulp and Paper Co., 862 F.2d 1525, 1529 (11th Cir. 1989).  See also American Nat. Bank & Trust Co. of Chicago v. Regional Transportation Authority, 125 F.3d 420, 429 (7th Cir. 1997) (appellate review of strict enforcement of pretrial order is deferential).   It is important, therefore, to include all legal theories in the pretrial order.

        E. Ten Points for Preserving the Record at Trial.

The trial of a case provides the most fertile ground for error.  Unless the error is brought to the attention of the district court, however, it will not support a reversal.  With rare exception, the federal Courts of Appeals adhere to the fundamental rule of appellate practice that a point not raised below is waived.  See e.g., Dudley v. Wal-Mart Stores, Inc., 166 F.3d 1317, 1323 n. 9 (11th Cir. 1999);  United States v. Gilkey,118 F.3d 702, 707 (10th Cir. 1997); Foley v. City of Lowell, Mass., 948 F.2d 10, 22 n. 17 (1st Cir. 1991).

While the types of possible errors at trial are numerous and various, there are some standard methods of preserving points for appeal.  Following are ten "points" to keep in mind when trying your case. 

            ONE:              WHEN POSSIBLE, SUBMIT YOUR POSITION IN WRITING.

Obviously, if you state your position in writing and file it with the clerk of court, it reduces questions about whether it is preserved.  For this reason, it is a good idea to submit your arguments and objections in writing, when possible.  For example, consider doing the following:

  • File Written Motions In Limine Before Trial.

  • At the Beginning of Trial, File A Trial Brief That Outlines Your Case.

  • File Short Trial Memoranda On Unexpected Issues That Come Up During Trial.

  • File a Written Brief Stating Your Position With Respect

  • To a  Rule 50 Motion For Judgment as a Matter of Law.

  • In Addition To Submitting Your Requested Jury Instructions In Writing, File Written Objections the Instructions That Are Given.

  • Use Both the Broad Brush and Fine Point Pen When Presenting Your Case.

            TWO:             FOLLOW UP MOTIONS IN LIMINE WITH NECESSARY OBJECTIONS AND PROFFERS OF PROOF.

Motions in Limine are a good idea because they raise issues before the heat of battle when they can be decided outside the presence of the jury. While Fed. R. Civ. P. 103 now provides that once the court makes a definitive ruling on the record admitting or excluding evidence, either at or before trial, a party need not renew an objection or offer of proof to preserve a claim of error for appeal, it is still a good idea to object to the evidence when it is presented at trial.  That way you avoid questions relating to the scope of the ruling and of your in limine motion.

If the district court grants your motion in limine but the evidence nonetheless comes in at trial, you must renew your objection at trial in order to preserve the issue for appeal.  See Collins v. Wayne Corp., 621 F.2d 777, 785-86 (5th Cir. 1980).  If the district court grants your opponent's motion in limine, you should make a proffer of evidence unless the substance is readily apparent from the context of the court's ruling or from a prior proffer.  See F.R.E. 103(a)(2).

            THREE:        BE POLITE -- BUT NOT BASHFUL -- IN MAKING OBJECTIONS.

If there is one particular subject on which trial lawyers and appellate lawyers disagree, it is whether to object during an opponent's closing argument.  Many trial lawyers keep their silence even in the face of outrageous arguments out of concern that an objection will offend the jury.  Then, when a disastrous verdict is rendered, they condemn the unfair tactics of opposing counsel.  Without an objection at trial, however, even the most egregious misconduct of opposing counsel will escape review by the appellate court.  The advice of the appellate practitioner, therefore, is to go ahead and make the objection --during the closing argument --but in the most polite way possible.  That way, you will preserve your objection for appellate review.  Moreover, you likely will not make your position any worse off with the jury than it was before.  If a jury is going to hold such an objection against you, it most likely has already made up its mind in favor of the other side anyway.  You are better off buttressing your position for appeal.

The same view applies to other types of objections during the course of trial, beginning with voir dire and the opening statements.  If faced with improper and prejudicial questions, evidence or conduct, be polite -- but not bashful -- in making your objections.  A bench conference sometimes helps alleviate concerns over offending the jury.  The bottom line, however, is that timely objections are critical to preserving your position for an appeal.  Without a proper objection, there is very little chance of appellate review.  Of course, if you are confident that the opposing counsel has not hurt your case, you do not need to make the objection.

It also is important to stay alert to the need for objections.  For example, don't forget to object to deposition testimony that is read at trial.  Your objections to such testimony in the pretrial order will not protect your position if they are never ruled on by the court.  You should make sure that your objection is made during trial when the deposition is read unless it previously is preserved in the trial record.

            FOUR:           MAKE SURE THAT EVERYTHING IS REPORTED.

You cannot appeal an incident that is not reflected in the record.  It is very important, therefore, to make sure that the court reporter takes down everything that occurs of significance.  This is not usually a problem during testimony.  Sometimes, however, issues come up during a break.  Be sure that the discussion is recorded or, at least, that a summary of the discussion is later placed on the record.  Bench conferences likewise should be reported.

            FIVE:             GET RULINGS.

It is not sufficient merely to make an objection or a motion in limine or motion to strike.  In order to have something from which to appeal, the district court must rule on the point.  See United States v. Kelly, 204 F.3d 652, 655 (6th Cir. 2000).  Therefore, if you object during the examination of a witness, do not allow your opposing counsel to continue the examination until the court has ruled on your objection.  If the court has taken a motion in limine under advisement and your opponent begins to offer the objectionable evidence, get a ruling on the point before the evidence is presented to the jury.

            SIX:                MOVE FOR A MISTRIAL WHEN A "CURATIVE" INSTRUCTION IS INSUFFICIENT.  

Sometimes the court sustains an objection after the damage has been done, for example, after the witness has answered the improper question or after the jury has heard the improper closing argument.  In such a circumstance, you have two available remedies:  you can ask for "curative" instructions or you can move for a mistrial.  Curative instructions, however, generally are not thought to cure anything, except the chance for an appeal based on the incident.  The jury has already heard the damaging statement and the "curative" instruction likely only will reinforce the jury's memory of it.  Moreover, if curative instructions are given, the appellate court usually will find the instructions sufficient to prevent harm.  See United States v. Flores-Rivera, 56 F.3d 319, 329 (1st Cir. 1995).  If faced with a particularly damaging transgression, therefore, it is better to go ahead and move for a mistrial without seeking curative instructions.  See Government of Virgin Island v. Charleswell, 24 F.3d 571, 577 (3rd Cir. 1994) (since party requested corrective instructions rather than a mistrial, trial Judge was entitled to assume that party did not want a mistrial).  If the court suggests curative instructions, present it with the reasons why the instructions are insufficient to remedy the harm.

            SEVEN:        USING YOUR ROADMAP AS A CHECKLIST, MAKE SURE THAT ALL OF YOUR EVIDENCE HAS BEEN ADMITTED OR PROFFERED BEFORE YOU CLOSE YOUR CASE.

You should not rest your case without making sure that all necessary evidence has been admitted or, if it was excluded, at least proffered.  See F.R.E. 103.  Your "roadmap" will help with this by providing a list of the essential elements of each cause of action and defense and the evidence that you are relying on in support of your position.  You should check with the courtroom clerk regarding the admission of documents to confirm that your list of admitted exhibits is accurate and that you haven't missed anything.

If you are the plaintiff facing a motion for directed verdict and realize that you missed an important point, you can seek to reopen the evidence to remedy the omission.  After all, one of the reasons behind the rule that limits a post-trial motion for judgment as a matter of law to the grounds advanced in support of the pre-judgment Rule 50 motion is that the plaintiff should have the opportunity to respond to the points made in the Rule 50 motion before the case is submitted to the jury.  See Ross v. Rhodes Furniture, Inc., 146 F.3d 1286, 1289 (11th Cir. 1998) (instructing that Rule 50 was designed to protect a litigant's Seventh Amendment right to cure evidentiary deficiencies before the case goes to the jury).

            EIGHT:         PRESENT EVERY POSSIBLE ARGUMENT THAT YOU HAVE TO SUPPORT YOUR POSITION ON A RULE 50    MOTION FOR JUDGMENT AS A MATTER OF LAW

Your Rule 50(a) motion for judgment as a matter of law at the end of your opponent's case should be as inclusive as possible because you cannot prevail on a post-trial Rule 50(b) motion on any ground not raised in your initial Rule 50(a) motion, nor will an appellate court rule that you are entitled to judgment as a matter of law on a new ground not raised in connection with your initial pre-judgment Rule 50(a) motion.  See Ross, 146 F.3d at 1289-90.  See also Morrison Krudson Corp. v. Fireman’s Fund Ins. Co., 175 F.3d 1221, 1246 (10th Cir. 1999) (failure to renew Rule 50(a) motion limits appellate relief to new trial).  But see Rankin v. Evans, 133 F.3d 1425, 1432-33 (11th Cir. 1998) (holding that technical non-compliance with Rule 50 requirements was excused where court and opposing counsel had actual notice of grounds for asserted deficiencies).  

It is a good idea to prepare your initial pre-judgment Rule 50(a) motion and supporting brief early, if possible before the trial even starts, when you have time to carefully consider the points.  It then can be revised at the end of trial as needed to reflect the actual evidence that was admitted.  Usually, the legal arguments will remain the same and the evidence will not vary much from what you anticipated.  Also, incorporate by reference into your Rule 50 motion any points that you made in pretrial motions as well as any other written submissions such as objections to requested jury instructions.

When making your initial Rule 50 arguments, try to be both general and specific.  State your proposition in a general manner and offer specifics as examples without limiting the argument to the specifics offered.  Sometimes a general argument is deemed broad enough to preserve an interrelated concept that is explained more thoroughly for the first time in post-trial motions or on appeal.

            NINE:            IF YOU FAILED TO INCLUDE A LEGAL THEORY IN THE PRETRIAL ORDER, MOVE TO AMEND THE PLEADINGS PURSUANT TO F.R.CIV.P. 15(b).

            As mentioned earlier, the pretrial order supersedes the pleadings and is meant to control the trial of the case.  Sometimes evidence relating to an omitted theory is nonetheless admitted at trial.  If so, the omitted legal theory can be redeemed through a motion to amend the pleadings to conform to the evidence pursuant to F.R.Civ.P. 15(b).  This rule provides that even when the evidence has been objected to at the trial on the ground that it was not within the issues made by the pleadings, the court shall freely allow the pleadings to be amended.  At the very least, a Rule 15(b) motion will enhance the chances of appellate review of the omitted legal theory.

                        TEN:              OBJECT TO ANY IRREGULARITIES APPEARING IN CONNECTION WITH THE JURY INSTRUCTIONS, THE JURY'S DELIBERATIONS OR THE FORM OF THE VERDICT.

It is well established that "[n]o party may assign as error the giving or the failure to give an instruction unless that party objects thereto before the jury retires to consider its verdict, stating distinctly the matter objected to and the grounds of the objection."  F.R.Civ.P. 51; Heath v. Suzuki Motor Corp., 126 F.3d 1391, 1934 (11th Cir. 1997).  You should make sure, therefore, that the record reflects your objections to the jury instructions and that your grounds for objection are clearly stated.  Otherwise, you will be deemed to have waived your objection on appeal unless the very narrow plain error doctrine applies.  See Alexander v. Riga, 208 F.3d 919, 429 (3rd Cir. 2000).

The form of the verdict often does not receive the attention that it deserves.  Usually, it is discussed at the end of the trial when the parties and the court are worn down by other battles that precede it.  The form of the verdict, however, sometimes provides an easy ground for reversal.  For example, in the Eleventh Circuit, a general verdict will not stand if any of the theories presented to the jury were defective.  See Richards v. Michelin Tire Corp., 21 F.3d 1048, 1055 (11th Cir. 1994); Grant v. Preferred Research, Inc., 885 F.2d 795 (11th Cir. 1989).  On the other hand, a special verdict form sometimes runs the risk of producing an inconsistent verdict that cannot stand.  These issues should be thought through in advance of trial and you should be prepared to address them if the court decides to submit the case on a verdict form that could cause problems.  If you fail to object on the record to the form of the verdict before the jury is released, you will be deemed to have waived the objection.  See United States v. Mitchell, 146 F.3d 1338, 1342 (11th Cir. 1998); Landsman Packing Co., Inc. v. Continental Can Co., 864 F.2d 721, 726 (11th Cir. 1989).

Similarly, you should state on the record all objections to the handling of jury questions during deliberations.  To do so, make sure that every juror communication is taken down by the court reporter, and that your position on the communication is presented to the trial court at a time when it can remedy the concern.

Please keep in mind that this is not meant to be a catalog or exhaustive list of necessary objections.  Always stay alert to possible error and think about whether there is anything that you need to do to make sure that your position is adequately reflected in the record.

        F. Use Post-Trial Motions To Clean-up the Record.

Of course, you should do everything possible to state your position clearly on the record during trial.  Sometimes, however, a point will hit you after the trial is over.  If you are in the unfortunate position of trying to salvage your case through a post-trial motion, consider whether the "new" point is related to one of the general points asserted during trial.  Often arguments at trial are in need of further clarification and elaboration.  There is nothing improper about explaining a concept further in a post-trial motion using new authorities, examples or closely related arguments.  See National Indus. Inc. v. Sharon Steel Corp., 781 F.2d 1545, 1549-50 (11th Cir. 1986).  Post-trial motions are useful for "cleaning up" the record to make sure that you have properly explained your legal theories.  One thing is for certain.  It is better to make the argument in the post-trial proceedings than to raise it for the first time on appeal.

        G. Supplement the Record with Intervening or Omitted Material.

The appellant is responsible for ordering the transcript.  If the appellant does not order the entire transcript, the appellee has the opportunity to request that the entire transcript be included on appeal.  Of course, it is safer to have the entire record included.  You should check the local rules of the appellate court for requirements that might be peculiar to that court with respect to the record on appeal.

Counsel should carefully review the record index to make sure that all items filed in the district court are included in the record on appeal.  Sometimes the clerk's office does not include a filing, such as a letter to the judge, in the record index.  Also, it sometimes is unclear whether exhibits to a filing are in the record on appeal.  If in doubt, consider paying a visit to the district court clerk's office to inspect for yourself the way that the record on appeal is put together.  Then, if you discover that a filing has been omitted from the record on appeal, you can move to supplement the record.

Occasionally, there is an intervening development that comes up after the trial that is proper for inclusion in the record on appeal.  If so, the rules provide for a method of supplementing the record on appeal to include such matter.

It is important to remember that appellate review is limited to the record before the appellate court.  Take every measure, therefore, to make sure that all of your legal arguments and supporting materials are contained in the record on appeal.

III.      THE VERDICT HITS: BUSINESS CONSIDERATIONS FOR IN-HOUSE COUNSEL

This section  addresses some immediate business considerations flowing from a substantial adverse verdict.  Because the rules of the different states can vary greatly, the focus will be on federal practice and procedure.

        A. Stays.

Under Rule 62(a) of the Federal Rules of Civil Procedure, there is an automatic stay for 10 days after entry of the judgment.  In addition, under Rule 62(b), the court on motion and in its discretion may stay enforcement of the judgment while a motion for new trial or to alter and amend the judgment is pending.  A stay pending appeal, however, typically must be accompanied by a bond.  See F.R.Civ.P. 62(d).  A defendant is entitled to a stay pending appeal as a matter of right when it posts a supersedeas bond.  See United States v. U.S. Fishing Vessel Maylin, 130 F.R.D. 684 (S.D. Fla. 1990).  See also Celotex Corp. v. Edwards, 115 S.Ct. 1493 (1995) (posting a supersedeas bond prevents enforcement of the judgment until the appeal is decided).

Although Fed. R. Civ. P. 62(d) provides that an appellant may stay the proceedings to enforce a judgment by giving a supersedeas bond, “a bond requirement may be waived in a court’s discretion.”  United States v. Certain Real and Personal Property Belonging to Hayes, 943 F.2d 1292, 1296 (11th Cir. 1991).  Accord Prudential Ins. Co. of America v. Boyd, 781 F.2d 1494, 1498 (11th Cir. 1986); United States v. Route 7, Box 7091, Chatsworth, Georgia, 1997 WL 412477 (N.D. Ga. 1997); United States v. 2204 Barbara Lane, 1992 WL 104387 (N.D. Ga. 1992). 

(1) The Court may consider the following five criteria when exercising its discretionary authority to waive a bond: 

(2) The complexity of the collection process;

(3) The amount of time required to obtain a judgment after it is affirmed on appeal;

(4) The degree of confidence that the district court has in the availability of funds to pay the judgment;

(5) The losing party’s ability to pay the judgment; if the losing party has vast resources to pay the judgment, the cost of a bond is a ‘waste of money;’ and

(6) The losing party’s financial situation; if the party’s situation is precarious, payment of the bond might place other creditors of the party in an insecure position.

U.S. v. Route 7, Box 7091, Chatsworth, Georgia, 1997 WL 412477 at *2 (citing Dillon v. City of Chicago, 866 F.2d 902, 904-05 (7th Cir. 1988)).  See also Texaco Inc. v. Pennzoil Co., 784 F.2d 1133, 1138 (2nd Cir. 1986), rev’d on other grounds, 481 U.S. 1 (1987).

For example, some courts have waived the bond requirement when the judgment debtor clearly has the ability to pay, or when the judgment is so large that the bond may prejudice the debtor’s other creditors.  See Olympia Equipment Leasing Co. v. Western Union Tele. Co., 786 F.2d 794, 796 (7th Cir. 1986).

If a supersedeas bond request is granted, the amount of the bond ordinarily is the amount of the judgment plus interest.  The court, however, has discretion to order alternative security as necessary to protect the rights of both the judgment creditor and judgment debtor.  See Curtiss-Wright Corp. v. General Elec. Co. 446 U.S. 1, 13 n. 3 (1980); Prudential Ins. Co. of America v. Boyd, 781 F.2d 1494 (11th Cir. 1986). 

If the trial court rejects a request for a stay or is unreasonable with respect to the bond requirements, the appellant may seek a stay from the appellate court under Rule 8 of the Federal Rules of Appellate Procedure.  Before requesting the appellate court to stay, however, the appellant must first request the relief in the trial court or show why it would be impracticable to do so.  There are constitutional limitations upon a court’s power to impose an excessive bond pending appeal.  See In re American President Lines, Inc., 779 F.2d 714 (D.C. Cir. 1985).

        B. The Bond.

A stay by supersedeas bond under Fed.R.Civ.P. 62 does not become effective until the bond is approved.  Generally, supersedeas bonds may be secured in a number of ways including:

  • Cash
  • Government bonds
  • Property
  • The guaranty of a corporate surety authorized to do business in the state where the federal district court is located

Moreover, some local rules impose additional requirements on the bond process.  For example, Local Rule 65.1.1 of the Northern District of Georgia provides that “[t]he clerk shall approve as to surety all bonds requiring approval.”  With respect to bonds for costs, the local rule provides that the bond must have as surety either a cash deposit equal to the amount of the bond, a corporation authorized to execute bonds under 31 U.S.C. § § 9304-08, or an individual within the district with sufficient property to pay the bond amount and collection costs.

The surety on a supersedeas bond is liable for the bond amount if the appellant loses the appeal and  fails to pay the judgment.  See Celotex Corp. v. Edwards, 115 S.Ct. 1493 (1995).  If the damages are determined on appeal to exceed the bond, the surety is usually liable only for the amount of the bond.  See Tennessee Valley Authority v. Atlans Machine & Iron Works, Inc., 803 F.2d 794 (4th Cir. 1986).

If a party ordered to post a supersedeas bond does not do so, its appeal may still proceed.  It simply lacks protection against execution on the judgment pending appeal.  See In re American President Lines, Inc., 779 F.2d 714 (D.C. Cir. 1985);  Michael E. Tigar, Federal Appeals § 6.11 (1999).

Under Rule 39(e) of the Federal Rules of Appellate Procedure, if the appeal is successful, the appellant can recover the expense of the supersedeas bond as a taxable cost in the district court upon remand. 

        C. Required Disclosures.

One very important immediate concern when a large verdict hits is the question of what disclosures must be made, and to whom they must be made.  Obviously, internal notification must be made promptly.  In addition, all notifications required by insurance coverage and loan agreements must be strictly observed.

It is also important that disclosures be made as required by the securities laws and accounting standards to avoid additional liabilities.  See Wilson v. Great American Industries, Inc., 855 F.2d 987 (2d Cir. 1988);  Carlisle Ventures, Inc. v. Banco Español de Credito, S.A., 1996 WL 680265 (S.D.N.Y. 1996).  For example, a verdict may be sufficiently material and non-routine to require disclosure in an annual or quarterly report, prospectus, proxy statement, form 8-K, notification to an exchange, or press release.  In addition, if the company has any pending deals, disclosures might need to be made to the other party to avoid breach of warranty.  See Goodman Mfg. Co., L.P. v. Raytheon Co., 1999 WL 681382, * 13-14 (S.D.N.Y. 1999).

IV.      THE APPEAL: HOW TO MAXIMIZE YOUR CHANCES OF REVERSAL THROUGH EFFECTIVE APPELLATE ADVOCACY

Following are some pointers on effective appellate advocacy.  These “helpful hints” offer practical advice on ways to improve the written and oral presentation of your appeal. 

        1. Include an appellate practitioner on your team. 

It is extremely advantageous to include an appellate practitioner on your team early to assist with issue spotting and to ensure that you do not waive any appellate rights.  The issues that are best for an appeal often are not the same ones that received the most attention at trial.  It is helpful to have a fresh “set of eyes” review the transcript and provide an analysis that focuses on issues likely to interest an appellate court.  If possible, consult with the appellate practitioner periodically through the life of the case.  At a minimum, you should have someone with this background look at your case immediately after receiving an adverse jury verdict because of the critical role that post-judgment motions play in shaping the appeal. 

Further, because there are numerous traps for the unwary in the appellate area, someone well-versed in the technicalities of appellate procedure can make sure that you do not inadvertently waive arguments – or the appeal itself.  For example, in one multi-million dollar case, the defendant lost its appeal entirely by obtaining an extension of time for filing its post-trial motion for judgment as a matter of law under Rule 50.  Although the defendant filed its notice of appeal within 30 days of the denial of the motion, it was untimely because the motion itself was filed late – even though the extension was granted by the district court.  An experienced appellate lawyer would have prevented this result by knowing that the time for filing a post-trial Rule 50 motion cannot be enlarged by consent or by court order. 

        2. Obtain advice on local practice.

Be sure that your team is aware of any peculiarities of local practice.  Although there has been some recent efforts to standardize federal appellate practice, each circuit has its own local rules.  Further, the local rules change frequently.  The best way to make sure that you have the latest version of the local rules is to pull them off of the circuit's webpage.  If you have a question about local practice, do not hesitate to call the clerk's office.  Usually, the clerks are very helpful with answering procedural questions that are not specifically addressed by the written rules.  Finally, once you find out who will be on your panel, research the backgrounds and opinions of the judges who will hear your case.  It is entirely appropriate to ask a former judicial clerk about a particular judge's style and approach to cases, including the type of questions to expect at oral argument.

        3. Insist on an early draft.

Even the most experienced appellate lawyer will need time to revise and polish the brief because every brief improves with skillful editing.  The best editing occurs when the writer has the time to put the brief down for a few days to gain some distance from the work.  It is a good idea, therefore, to set up a drafting schedule early, with specific dates for circulating drafts well in advance of the brief's due date.  Keep in mind, however, that the first draft is a working document that is never as good as the final product.  Do not expect perfection on the first round.

After circulating the first draft, schedule a "roundtable" session so that all the members of your team can discuss the work.  This can be done easily by conference call, if necessary.  The roundtable can be helpful in focusing themes and in providing valuable feedback to the principal brief-writer.  The actual drafting of the brief, however, should be left to a single, experienced writer.  Brief-writing by committee usually results in a hodge-podge lacking the flow that is critical to effective written advocacy.

        4. Consider these tips on successful briefing.

Following are a few classic tips on appellate advocacy.  These points can be found again and again in books on legal writing and in articles authored by judges who read the briefs and decide the cases.

·  Avoid the shotgun approach.  If you ever are on the losing side after a lengthy trial, you no doubt will have a long list of errors that you think were harmful.  The fact of the matter, however, is that appellate courts do not respond well to an appeal that presents numerous points for review.  Your chances for reversal are actually increased if you select only a few well focused issues for consideration.  As a rule of thumb, an appellant should raise no more than five points even after a lengthy trial.  Two or three issues is ideal. 

·  Develop a theme:  Your appeal should have a theme, which you should make clear from the beginning of your brief.  Even when you are the appellee, you should take control of the issues and not merely rebut your opponent’s arguments.  Take advantage of every opportunity to promote your theme.  For example, when requesting oral argument, elaborate on the request so the court will learn not just that you want argument, but also what the issues are and why your case is extremely important. 

·  State issues in a manner that requires an answer in your favor.  A proper statement of the issues is critical.  You should incorporate enough information into the statement of the issues to compel the conclusion that the court below erred and to suggest why.  Be sure, however, that the issues are stated clearly.  Avoid convoluted sentence structure that must be read more than once to be understood.  Also, make sure that your principal headings correspond to your statement of issues.  The major headings are simply the answers to the questions presented by the statement of issues.  You should have the exact same number of major headings as you have issues, and the headings should state why the ruling to be reviewed constituted harmful error. 

·  Use preliminary paragraphs.  Each section of the brief should have a preliminary paragraph to catch the interest of the reader and convey why the court should rule in your favor.  This introductory paragraph should elaborate on the heading and summarize your particular argument.  Like the beginning of a newspaper article, it should be presented with a broad brush, leaving the detail for the paragraphs that follow. 

·  Use the statement of facts to tell a story.  There is nothing worse than a dry statement of facts that simply recites events in chronological order without regard to importance.  While it sometimes is best to make a chronological presentation, this is not always true.  You should use your statement of facts to tell an interesting story, to reinforce your theme and to make the reader sympathize with your case.  Make sure the important facts are presented early.  You will always have a chance to put them in further context in subsequent paragraphs. 

·  Above all else, maintain your credibility.  Credibility is critical to an appellant because the tendency of any appellate judge is to affirm the rulings of a fellow member of the bench.  So, be absolutely precise in your statement of facts.  Back up every factual statement with a citation to the record.  Where a piece of evidence is particularly important, quote from the document or testimony.  Likewise, make sure that all the cases that you cite support the propositions for which you cite them.  Use short quotations from the authorities to support critical points, but be sure that your point is independently stated in the text of the brief.  Avoid overstating anything.  In fact, understatement is much more effective because it focuses the court on the bottom line. 

·  Avoid footnotes.  Those lawyers who were on law review boards in law school find it difficult to believe that briefs are better when they are not cluttered with footnotes.  A brief, however, does not serve the same function as a law review article and judges consistently say that they do not like footnotes in briefs.  Footnotes break up the flow and make work for the reader, who is forced to shift between thoughts and look for his or her place again after finishing the note.  Further, it is a mistake to place important material in a footnote.  If the point is important, it should go in the text where it will not be overlooked.  If it is not important, it should be left out altogether. 

·  Revise, condense, and distill.  Imagine a yard-high pile of briefs on your desk that you must read – one after the other.  You would soon dread picking up those thick ones.  The lighter ones, which are easier to get through, have a psychological advantage.  Appellate judges are in precisely this situation, facing a never-ending pile of briefs.  When it comes to effective appellate advocacy, therefore, shorter is better – particularly with respect to your opening brief.  Your goal should be to make it easy for the court to see your point, and to grasp it quickly. 

·  Use reply briefs effectively.  Often lawyers are tempted to use a reply brief to rebut every argument advanced by the appellee.  The more effective approach, however, is to cut to the bottom line, if you can, showing that the appellee did not create an issue with respect to one or more of your key points, or that the appellee’s arguments are not really relevant.  As with your principal brief, make frequent use of record citations to reinforce your credibility and, where a critical point is concerned, to expose liberties that your opponent has taken with the record. 

        5. Budget for thorough oral argument preparation.

Oral argument does not sway the panel in every case, but it does in some.  When you are appealing a large judgment, therefore, be sure to budget for a thorough oral argument preparation. 

Even though the actual time allotted for argument is brief, the preparation required for argument is extensive.  Usually, oral argument takes place months – or occasionally years – after briefing.  It is important therefore, for counsel to re-read all relevant materials, including significant portions of the record, transcript and case law, as well as the briefs.  Again, because credibility is so important to an appellant, counsel should not have to give “I don’t know” as an answer to a question at oral argument. 

Every conceivable question should be analyzed in advance.  Moot courts are very effective for this purpose.  Indeed, the most useful moot courts are those where some of the “judges” are lawyers with no prior information about the case because they will be in the same position as the judges who will decide the case.  

V.        THE COURT OF PUBLIC OPINION:  PRACTICAL CONSIDERATIONS FOR TURNING AROUND THE PUBLIC PERCEPTION OF CORPORATE AMERICA

The January 2003 edition of the ABA Journal contains an article titled, Fear and Loathing in Corporate America.  The article's subtitle, Big Business's Public Tribulations Have Led to Skeptical Juries, New Laws and In-House Lawyers Working to Tighten Compliance, suggests that recent events such as Martha Stewart's misfortune and the Enron debacle have increased public distrust of corporations:

[T] he bleak perception has caught the attention of more than the columnists and cartoonists who have had a field day with Stewart's travails. …

A first-of-its-kind survey for the Minority Corporate Counsel Association released in October shows that among potential jurors, 75 percent or more distrust corporations on a variety of counts.

Historically, the level of corporate distrust has stood at about 50 percent in general polls, says Arthur Patterson, vice president of DecisionQuest, the Los Angeles trial consultancy that conducted the MCCA survey, which focused exclusively on juror attitudes toward corporations.  "Now, we have these overwhelming percentages," Patterson says.  "That's highly significant."

John Gibeaut, Fear and Loathing in Corporate America, ABA Journal (Jan. 2003) at 52.

This high level of adverse perception of big business, however, is not  really new.  More than ten years before this ABA article, The Wall Street Journal reported:

A poll of people eligible for jury duty nationwide, conducted by the California research firm Metricus, found that 70% were more likely to favor an individual plaintiff over a corporate defendant before they knew anything at all about the dispute. …

"We see hundreds of individuals deliberating during the course of a year, where someone on a jury says it was just the big fish eating the little fish," said Leonard Schwarz, a principal at Metricus, "but it's staggering to have it calibrated at that level."

Stephen J. Adler, Corporations Face Uphill Struggle in Jury Trials Involving Individuals, Wall St. J., Nov. 13, 1991.

Whether or not this phenomenon is new, it is becoming increasingly obvious that the public's perception of Corporate America affects the decision making process – not only of jurors and judges – but also of consumers and investors.  As pointed out in the ABA article, winning at trial or on appeal will be a Pyrrhic victory if the battle is lost in the court of public opinion. 

The real question, therefore, is:  What can be done to counteract the public's negative perception of corporations?  Staying out of court in the first place through effective compliance programs and the use of alternative dispute resolution can help reduce exposure.  But, are these tactics enough?  There always will be some legal disputes that will end up in court despite a company's best practices and complete innocence.  Sometimes bad things happen to good companies.  When that occurs, the company should have in place a deliberate plan for communicating a positive message to the public as well as a well-crafted legal strategy.  See Harvey L. Pitt and Karl A. Groskaufmanis, When Bad Things Happen to Good Companies:  A Crisis Management Primer, 15 Cardozo L. Rev. 951 (1994).

These days, there are many resources available to help a corporation to communicate its message to the public.  Of course, developing good media relations should be a top goal even before a dangerous case surfaces.  Plaintiffs' lawyers and prosecutors have long known how to take advantage of this source to advance their causes.  Defendants, however, also can take steps to get their side of the story out through the media.

Working to get positive coverage of a corporation's "good citizen" contributions can lay the groundwork for counteracting negative press.  When a crisis does strike, the corporation should not bury its head in the sand, but should work to deliver a message of disclosure and responsibility. 

Many managers make the mistake of trying to deny the existence of a crisis, or defend its implications with less than full disclosure.  The key to public relations, however, is candor and complete disclosure.  If a company knows there really is a problem, it should say so, and then discuss how it is dealing with the situation.  It should acknowledge the consequences of any clearly wrongful behavior on the part of the company or its employees, and show the public that the company and its employees share their concerns.

See When Bad Things Happen to Good Companies, at 965.  Public relations strategies should be implemented immediately, or the company will lose in the court of public opinion before the first law suit is filed.  See Carole Gorney, Litigation Journalism is a Scourge, New York Times, Feb. 19, 1993.

Now that internet usage is almost universal, a company no longer needs to depend entirely on the media to get the message out.  It can work through its own website and others on the internet.  In addition, many trial lawyers now work side-by-side with litigation communication consultants who can advise on public relations issues as well as on traditional jury selection questions.  Following is a checklist of key components for a litigation communications strategy  that was initially presented in materials distributed by the American Corporate Counsel Association at its 2000 Annual Meeting, which had the theme, "Delivering Strategic Solutions."  See Laurie Webb Daniel, T. Martin Fiorentineo, and Frederick H. L. McClure, Averting Disaster:  How to Turn Around a Runaway Verdict, at 46-52.

1. Initiate an Integrated Strategy.

The communication strategy surrounding the litigation should be tailored to and support the litigation strategy.  The first rule of thumb is that any public relations surrounding the case should “do no harm”.  The litigation communications, regardless of the vehicle used to convey it, should enhance the legal theories, create clarity of message, and work to control the story.  To be effective, it must be part of an overall, coordinated, and comprehensive communications campaign.  See Dirk C. Gibson, “Litigation Public Relations:  Fundamental Assumptions,” Public Relations Quarterly, 43, no. 1 (Winter 1998): 1-4.

2. Conduct Jury, Judicial, and Opinion Research.

The research done on the potential venire and judge should be coordinated so that legal theories and communications strategies converge.  The litigation communications team should work together with counsel to develop and test effective messages.  This should include translating legal jargon into language understood inside and outside the courtroom.  Indeed, the most effective legal theories should also resonate with the public, the media, the government, and opinion leaders.  The trial team should test the message with mock trials and revise the themes when necessary based on the reactions of independent mock jurors living in an area comparable to the venue of the litigation.

3. Court the media.

  • Traditional media

Be proactive with the press.  Identify your audience.  It will include jury/venire, the media, opinion leaders, and the general public.  News releases, news conferences, and video and audio news releases are all vehicles to consider as a way to get your message out to your targeted audience.  In addition, by working directly with reporters, editors and producers, the company’s message can be conveyed to the public instead of sitting back while the prosecutor or plaintiff’s attorney only gives their side of the case.

There is a national and local component to media relations.  Depending on the magnitude of the case, the corporation may be dealing with the national network news, the Wall Street Journal, The New York Times and other national print and broadcast media.  Having someone who knows the legal reporters at those media outlets is important.  It is equally important that you manage the local media where follow-on stories will be inevitable and could spawn national stories. 

  • Paid Media.

Developing advertisements and “advertorials” can take the company’s message directly to the public without a reporter’s bias or producer’s filter.

  • Internet.

Advocacy groups used by the plaintiffs' bar have their own web sites.  Consider harnessing the power of the Internet to reach the broadest possible audience.  Consider using your own company’s web site or a link to another site to reach to the public.  It is now common for both plaintiffs’ lawyers and corporations to put up web sites on individual cases.

  • Develop Third-Party Allies.

When it comes to the court of public opinion you can never have too many visible friends.  Reporters and producers often take their queues from outside groups and individuals.  By building bridges before the trial ever begins, you can develop third-parties who can be positive sources of information for the media and convey the true character of your company.

4. Don’t Forget Investors and the Financial Community.

High-stakes litigation and runaway verdicts can spook investors and financial analysts.  Give them the facts and let them know you have directed the appropriate resources to address the issue.  Have your investor relations people brief analysts and consider having counsel available to answer any questions, if warranted.

5. Maintain Effective Intra-Corporate Communication.

Communication between management and employees about high profile cases that may garner significant media attention should be prompt and preemptive.  Make it a point that your employees hear the news from you first, with your analysis, before they hear it from the media.  In addition, employees can be excellent allies.  As they interact with their community they can provide effective grassroots support.  Be sure to convey to them the message that you want to send to the public at large.

In conclusion, it is now widely recognized that legal battles increasingly are being fought in the court of public opinion, long before the case ever gets to trial.  In fact, companies can win in court, but lose in the court of public opinion. A company’s communications strategy, to be effective, should maintain the positive positioning of the company before suit is filed, during the litigation and throughout the appeals process.

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