Litigation Valuation Services Provided by Betts Dispute Resolution Services

The litigation valuation services provided by Michael J. Betts are consulting services through which Mr. Betts assists litigants and their counsel in determining the reasonable settlement value of their cases. In providing these services, Mr. Betts is normally retained by one of the parties in a litigation - i.e., not by the parties jointly, as is the case with mediations and other forms of ADR.

Decision tree analysis is an important component of the litigation valuation services provided by Michael J. Betts and Betts Dispute Resolution Services. For more information about decision tree analysis and how it is utilized by Mr. Betts, please see our Mediations page.

Our litigation valuation services can provide value at any stage of a case, but are particularly beneficial prior to entering into settlement negotiations or as a case is approaching mediation. In addition to determining a reasonable settlement value or negotiating range for a case, a quantitative assessment of the case also can provide our clients and their counsel with valuable insights concerning litigation strategy, including the extent to which the outcome of particular issues can affect the overall value of the case.

The specific services we provide in the course of any particular engagement are customizable to each case. The range of services can include: (i) conferring with party representatives and/or counsel to understand the principal factual and legal issues involved in the case and the admissible evidence available to support each party’s positions; (ii) reviewing the pleadings and substantive filings in the case; (iii) building a decision tree, using sophisticated software, that reflects the possibility of various outcomes concerning the principal issues involved in the case at various procedural steps (the tree can be built independently by Betts Dispute Resolution Services, or in collaboration with the client and/or counsel); (iv) determining, through the decision tree analysis, a reasonable and realistic settlement value for the case; (v) preparing a confidential report for the client and counsel setting forth the decision tree and other relevant information supporting the evaluation; and (vi) participating in a meeting with the client and counsel to present the report.

Frequently Asked Questions about the Litigation Valuation Services Provided by Betts Dispute Resolution Services

Are you retained by all parties, as in the case of a standard mediation, or only by one of the parties?

We are usually retained by one of the parties (or a group of related parties) in a lawsuit or arbitration proceeding, i.e., either by the plaintiff(s)/claimant(s) or the defendant(s)/respondent(s), but not both.

We already have outside counsel representing us in the case - why do we need you?

There are a number of reasons, and of course the reasons vary from case to case. First, we provide a quantitative analysis of the settlement value of your case through Decision Tree Analysis and other tools that most of our clients and most lawyers have not been trained to use. Second, we provide a “fresh set of eyes” to evaluate the strengths and weaknesses of the parties’ respective positions (if requested), and to objectively and realistically determine the settlement value of the case. Third, most litigants and most counsel, who believe strongly that their positions are meritorious, may find it difficult to objectively and realistically evaluate the case. Commercial litigation and business disputes often call into question the propriety of actions and business decisions of the same corporate managers who are responsible for, or will have input into, settlement decisions. It can be similarly difficult for counsel to evaluate cases in a purely objective manner. After all, the best trial lawyers are passionate advocates who are charged with the responsibility of zealously representing their clients. And many litigators, who have been retained to aggressively litigate a lawsuit to victory, may be understandably reluctant to recommend a settlement that involves a significant degree of compromise by the client.

At what stage of a lawsuit should we consider retaining Betts Dispute Resolution Services to Provide Litigation Valuation Services?

This depends on a variety of factors, but it is clear that many litigants would realize significant value from retaining us at the inception of a case — or, in the case of a plaintiff, before filing the lawsuit. Most cases are settled eventually, and substantial litigation expenses can be avoided by achieving a settlement at the early stages of a case. In nearly all cases, a decision tree can be effectively built at the inception of the case and even absent a settlement the tree can be helpful in crystallizing the issues and developing litigation strategy. As the case proceeds, and additional information is obtained through investigation and discovery, and as the court makes preliminary rulings in the case, the tree can be refined to adjust the pathways the case may take and, where appropriate, to adjust the probabilities that are assigned to various issues and outcomes. If we are not retained at the inception of a case, most engagements will be for the purpose of providing consultation concerning settlement strategy and developing a decision tree to assist in determining the realistic settlement value of the case. These engagements typically occur when a party anticipates entering into settlement discussions its adversary or when a party is preparing for an upcoming mediation.

What are the deliverables? Do you provide a written report in the course of the engagement?

This will depend on the services provided (see above) and normally will consist of a confidential written report that includes the decision tree built for the case and, where applicable, other tools such as distribution graphs and sensitivity analyses. Distribution graphs provide visual presentations of the probabilities of the potential outcomes and can be an effective way to report litigation risks to management. Sensitivity analyses can provide guidance concerning the impact of certain outcomes on particular issues on the overall case and can inform cost-benefit decisions about, e.g., whether spending a certain amount in legal fees in order to gain a higher likelihood of success on an issue is justified (such as, for example, whether spending $50,000 to litigate an evidentiary issue is warranted, given the impact the outcome of that issue will have on the overall value of the case).

How do you protect against decision trees representing “garbage in, garbage out”?

The first part of the adage — “garbage in” — simply does not apply to a decision tree that is based on a thorough and objective assessment of the issues and that recognizes the possible success of positions taken by the other side. Objectivity is critically important and in building trees we review the parties’ respective positions concerning all material factual and legal issues so that we can be assured that the tree we build, and the probability assessments it incorporates, are objective, realistic and reasonable. And avoiding “garbage out” is the very purpose of the quantitative approach on which the tree has been built. The information provided by a well-constructed decision tree is much more valuable to most litigants than the subjective and qualitative evaluations that are often expressed, such as it is “more likely than not” that the court will grant summary judgment or “the odds are good” that the judge will allow the case to go to the jury.

What assurances do we have that our communications with you about the case and your written report will be kept confidential and will not be subject to discovery?

Our engagements are subject to the attorney-client privilege and, as our engagement letters acknowledge, we are required by law to maintain in confidence all communications with our clients. Our written report and all other work product will be protected from discovery by the attorney-client privilege and work product doctrine. Sometimes our clients will elect to disclose the decision tree, or some other aspect of our work product, to a mediator or to the other side in the interest of enhancing settlement possibilities, but, as our engagement letters provide, we would never do so without the express written authorization from our client.

What are your fees for litigation valuation services?

We charge a flat fee, payable upon retention. The amount of the fee in any particular engagement depends on the scope of services requested by the client, the complexity of the case and the extent of the evidence and/or court filings that we will need to review and analyze. In any significant litigation matter, our fees will represent a very small percentage of the overall litigation expense incurred and the services we provide, in exchange for those fees, can be instrumental in achieving a settlement of the case and avoiding litigation expense.