Arguing Class Actions is a monthly column by Adam J. Levitt for the National Law Journal.
Reprinted with permission from the May 1, 2023 edition of the National Law Journal. © 2023 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.
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Early in my legal career, I always looked forward to reading Jerry Solovy’s and Bob Byman’s “Discovery” column in The National Law Journal (a compendium of which can be found here). Their column, which combined substantive rigor with practical application, was, in my view, a “must-read” for younger lawyers (and, frankly, all lawyers). It is also both a primary reason why I wanted to start writing this class action litigation column, as well as a polestar for what I want this column to be.
The COVID pandemic delivered an enormous shock to our judicial system: across the country, state and federal courthouses shut down in-person proceedings and scrambled to find stopgap measures to allow litigation to continue, while prioritizing the safety of litigants, court staff, and the general public. Trial backlogs grew exponentially, and, continuing to honor the constitutional right of criminal defendants, required many court systems to shift resources away from civil trials. This, in effect, temporarily deprived civil litigants of one of the most potent and basic tools for resolving lawsuits: the jury trial. This lack of ability to go to trial, and the resulting backlog of cases awaiting trial, affected the entire country; every federal district court saw a dramatic drop in cases tried to a jury between 2019 and 2020. Paradoxically, however, the inability to proceed to trial may have been the catalyst for a fascinating reversal to a longer-term trend, as well as the resurgence of a dwindling practice.
The number of cases tried to a jury in federal district courts across the country was in decline even before the first COVID patients began exhibiting symptoms. The Federal Judicial Center’s figures show a steady decline, both in the percentage and total number of cases tried to a jury, for more than a decade. Where 1.2% of cases filed in federal district courts eventually reached trial in 2009, by 2019 this rate had been cut in half.
This steady decline cratered in 2020, with less than 600 cases being tried across the entire country in federal courts (compared to three times that number the year before). Just .4% of the cases filed in 2020 eventually reached trial, a third of the 1.2% of the cases that had reached trial ten years earlier.
With the courthouse doors effectively locked, parties suffered from an absence of any motivation to quickly resolve cases. Indeed, without the threat of an impending trial, defendants had less reason to seek an expeditious and reasonable settlement. Eager to keep their dockets from exploding (and hoping to contain a future trial backlog), judges across the country exacerbated this imbalance by aggressively pressuring parties to settle matters instead of taking them to trial, further placing plaintiffs in a compromised position. Plaintiffs hoping to achieve some measure of injunctive relief were left in an even worse situation. Defendants, uninterested in changing their business practices, had little incentive to consider such plaintiffs’ demands, because the long trial backlog would ensure that their wrongful business practices could continue unabated for at least a few more years than they otherwise would have even if a plaintiff was eventually successful at trial.
Finally, the difficulty in taking a case to trial during the COVID lockdown years reduced the number of cases brought by plaintiffs that might set precedent. New precedent is the foundation of our common law system, but cases that might create new law, or clarify existing law, cannot do so if they are settled before trial. Rulings on motions are valuable for clarifying existing law or staking out new legal territory, and early settlement stifles what might otherwise blossom into further refinement of the law.
Enter The Big Bounce. Perhaps two years of COVID-enforced lockdown enhanced plaintiffs’ attorneys appreciation for the courtroom. Perhaps defense attorneys became more confident as early settlements (often court-encouraged) became more and more common. Perhaps, the COVID-era dynamics of settlement simply reached a breaking point. Or, maybe, after years of contraction, law firms on both sides of the bar felt more confident about taking cases to trial—or have a greater sense of fearlessness, having survived the pandemic. For whatever reason, the statistics are clear: in both 2021 and 2022 both the number of cases filed and the number of cases reaching a jury trial increased dramatically, almost doubling from their low point. While the percentage of cases tried to a jury stayed steady for each of those two years at .7%, an overall increase in the number of cases meant that more and more firms were willing to go to the mat for their clients. In what appears to be the beginning of an upswing in both the raw number of cases taken to trial and the percentage of cases filed that get taken to trial, juries in federal courts across the country have heard three times as many cases as they heard in 2019.
This uptick says two things: first, courts are ready to hear cases again. Judges across the country have become loathe to grant trial continuances as they work through the backlog of cases on their dockets awaiting trial. Second, lawyers are willing to bear the risk of trial, and to use the threat of that risk, to realize real justice for their clients.
In a post-pandemic world, it is more incumbent on litigators than ever before to approach a case from the outset assuming that it will go to trial, and taking all necessary pretrial steps to facilitate and prepare for that goal. This mindset has an illuminating effect on the realistic strengths and weaknesses of a case. It is easy to get bogged down in the often scorched-earth litigation of discovery, motion practice, and expert warfare—tunnel vision is not uncommon when it comes to pretrial litigation. Constantly assessing the evidence as it is uncovered in discovery and slotting it into a proof chart or trial outline, however, allows the merits of the case to start becoming clear from the earliest stages of a case. Sitting down with your own case can crystalize not only the issues remaining in dispute (potentially encouraging resolution before trial), but may also inform how best to leverage the prospect of trial to ensure a just, and early, resolution.
This clarification of issues also, most essentially, gives plaintiffs an indication of the value of their case. The willingness to have a neutral factfinder step in and determine not only liability but also damages indicates a confidence in the case that may drive not only greater potential value for settlement, but ensures that plaintiffs may demand important injunctive relief from a position of strength. Looking your adversary in the eye and stating clearly that you are ready and willing to try a case—and to have your adversary know that you’re capable of doing so—can have an enormous impact on their willingness to consider reasonable settlement terms. Given the numbers, it appears that more and more plaintiffs’ attorneys are willing to make that bet, with defense counsel often taking that bet at their clients’ peril.
The fact is that there’s no greater “safety valve” to a litigator than the ability to go to trial—and to do it well. With access to trials reestablished and cases getting tried, that thesis will ever-increasingly be put to the test. We’re up for the challenge. We hope that you are as well.
Thank you to DiCello Levitt partners John Tangren and James Ulwick for contributing to this column.
Adam J. Levitt is a founding partner of DiCello Levitt, where he heads the firm’s class action and public client practice groups. He can be reached at [email protected].