Reducing Discovery Costs: The American ExperienceAuthor(s): Paul J. BschorrSource: Litigation, Vol. 5, No. 4, ORGANIZING AND TRAINING FOR LITIGATION (Summer1979), pp. 3-4, 62-63Published by: American Bar AssociationStable URL: http://www.jstor.org/stable/29758479 .

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Trial Balloon

Reducing Discovery Costs:

The American Experience

When I was asked last year to chair a Section of Litigation subcommittee effort to suggest practical means of

reducing discovery costs, my first

response was to recommend that we rewrite the Federal Rules of Civil Pro? cedure on pleadings and discovery.

My second response was to suggest we

adopt the English method, where the

losing party is frequently taxed with the costs, including attorney's fees, incurred by the winner. Paul Leonard

very ably sets forth the English ex?

perience in his Trial Balloon article in the Spring 1979 issue of Litigation

(Vol. 5, No. 3). While there are many pros and cons

in deciding to align our discovery pro? cedures more closely with the English system, my purpose here is more

humble?simply to offer some practi? cal suggestions within our present rules for reducing the tremendous costs of engaging in that process.

These suggestions were gathered from practitioners across the country and are, for the most part, rooted in common sense. At times they are so obvious that they may be overlooked

by busy practitioners who, faced with rule and court imposed deadlines, find it easier simply to engage in the

gamesmanship of extensive motion

practice and what some people call hard-nosed litigating of every issue. I do not suggest that, given the present, liberal federal discovery rules, there is

anything improper about such hard nosed litigating. All of us know many cases where that is exactly the correct, and at times only, approach to take. But there are other alternatives to consider where the situation might warrant it?situations where practi

by Paul J. Bschorr cal suggestions might be utilized to

keep costs down.

Three themes recur in these sugges? tions. The first is best summed up in one of the responses to my request to various practitioners for hints to keep costs down in situations where the client has a limited budget for that

particular litigation: In response to your assumption that your client has limited re? sources to prosecute or defend a

case, I offer the following: 1. Don't let the other side

know; 2. Don't bring the lawsuit;

Mr. Bschorr is a member of the New York firm

of White and Case. He is chairman of the Dis?

covery Committee of the Section of Litigation. The July 10, 1978, Report of the Subcommittee on Reducing Costs of Discovery is available

upon request to Mr. Bschorr.

3. Advise your client on the beneficial aspects of bank?

ruptcy . . . ;

4. If your client is to be a plain? tiff, make certain your mal?

practice insurance is in full force

5. If your client is the defen? dant, advise him that he is no longer your client.

The second theme is best sum? marized by Art Buchwald in an article he wrote over a year ago in answer to some of the comments made by Chief Justice Burger at the 1978 ABA

midyear meeting in New Orleans.

Mr. Buchwald stated that he had been giving great thought to the point made by the Chief Justice that much of the delay and abuse in our judicial system was caused by incompetent lawyers. After much investigation and study of the system, according to Mr. Buchwald, he concluded that re?

spectfully he had to disagree with our Chief Justice. The delay and abuse was not caused by incompetent law?

yers?it was caused by the competent ones. For, after all, only a competent lawyer would know how to file suc?

cessfully motion after motion and

thereby gain delay after delay of a trial date or of discovery process. Only a

highly competent lawyer would know how to wear down a witness by day af? ter day of examination into the minu? tiae of his life when the only issue re? lated to the case is what that witness

was told by his broker four years ago when he bought some stock. Only a

competent lawyer could devise a doc? ument request that is perfectly valid under Rule 34, but will occasion

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10,000 man-hours of file search and

compilation to fulfill?or can prepare that perfect set of interrogatories, which, with definitions, instructions, and subparts, is both proper under Rule 33 and defies intelligible an? swer?or can prepare the lengthy in?

terrogatory answers that say little, if

anything. The third theme, and really the ma?

jor theme of many of the practical suggestions to cut discovery costs, is that most litigation today ends not in a trial but in a settlement?yet discov? ery and pretrial procedures are all

geared to going forward with that trial.

I believe Judge John F. Grady, of the Northern District of Illinois, stated it best in an article last year in Litigation (Spring 1978, Vol. 4, No. 3) entitled, Trial Lawyers, Litigators and Client Costs. In beginning the ar? ticle he posed the following:

If the candid little boy from Hans Christian Andersen's story "The

Emperor's New Clothes" were to visit our American legal scene, I think one of his first questions would be: "Since 95 percent of your civil suits are settled without trial, why can't they be settled early with? out all the delay and expense?" This unsophisticated query prob? ably would evoke from our estab? lishment an indulgent smile and this ready answer: "Son, it isn't that easy. First of all, lawyers can't

really tell whether a particular case will be settled or not, so they must

play safe and prepare for trial. Sec? ond, even if settlement is contem?

plated, the attorneys must engage in extensive investigations to learn the facts of the case, so they can de? termine what a reasonable settle?

ment would be."

Judge Grady expressed his disen? chantment with that answer?and I

must also? as unresponsive. While it is true that a good lawyer

must be prepared for any eventuality, including trial, most so-called trial

preparation work ends up as settle? ment preparation work. The major function of discovery is, or should be, to develop sufficient information to be able to have the parties evaluate the issues and their positions and then to negotiate a meaningful settlement.

Under American jurisprudence, the normal action at law is between

two litigants who must pay their own counsel's fees. These litigants may have started the suit steadfastly resting on the bedrock of moral prin? ciple; but after the wear and tear of

pretrial proceedings, and frequently on the eve of trial, they find that the alternative of settlement as a purely dollars and cents proposition is the

only answer. And more and more, clients are questioning the tremen? dous costs of litigation?particularly legal fees?and whether all of that

pretrial discovery was necessary to get to the settlement.

If discovery is utilized with an eye toward settlement as well as trial, I believe that the client will recognize that pretrial discovery, as modified by this approach, is indeed worthwhile. If an evaluation of issues and an ap? praisal of the respective positions could be done earlier in the pretrial process, maybe Hans Christian An? dersen's little boy would no longer have his question to ask.

Sit and Talk One suggestion received from a

number of practitioners is for both

counsel, shortly after a complaint is filed, to sit down together, maybe over

lunch, and get to know each other if

they do not already. They can also at?

tempt to gain some further insight both into the nature of the controver?

sy, and into what both sides really ex?

pect to get out of the action. Avenues of resolution may occur that will avoid the expense of a lengthy litigation.

Also, where the discovery needs of the two parties are relatively equal? where they are unequal this sugges? tion may not be as workable?counsel should explore and agree with each other on reasonable bounds and

scheduling of discovery. Both sides can present their own discovery needs and attempt to resolve amicably any problems that may be occasioned

thereby. Counsel should also consider

exchanging basic information and documentation without the need of a Rule 34 request. After all, any court will allow at least discovery of the basic documentation and informa?

tion, so in the appropriate case coun? sel should seek to do it amicably with? out motion papers, pleadings and other court involvements.

Another thought, which at first

hearing may seem somewhat radical, is for the lawyer to consider the im

pact that information his own client

possesses may have on his adversary and consider some way to make that information available to his adversary in the most advantageous way.

Cardinal Rule One of the cardinal rules of pretrial

discovery has always been that when

your client is being deposed, he is only to answer the questions that he is asked, and he is not to volunteer in? formation. Each of us in such a situa? tion has had a client ask us whether he should volunteer his side of the story and put his best foot forward during a

deposition. And each of us has ad? vised that certainly if he is asked the

right question he should do so, but that he need not worry about forcing the issue because the deposition is not

really the forum to present his case. We can do that at trial. Then, of course, during the deposition, the

opponent never really asks any ques? tions that would allow the client's

story to come out, and the deposition ends without your adversary finding out one of the key items of strength in

your client's position. I think that the advice that a deposition is not the

place to volunteer information is a

generally sound proposition. But let me offer an alternative that you should at least consider in the ap? propriate circumstances.

If your client's story contains infor? mation not known to your adversary's counsel (and I stress adversary's counsel, because one should not as? sume that his adversary has told his own lawyer everything), and that in? formation is either detrimental to

your adversary's position or would be

important information for your ad?

versary's counsel to know in apprais? ing settlement potential, you might consider finding some way for having your opponent's counsel uncover this information himself during the dis?

covery process. Your opponent's counsel will certainly give more

weight to that information if he dis? covers it himself by questioning dur?

ing a deposition, than if you simply volunteer it to him in a later settle? ment negotiation. Also, your oppo? nent's counsel might also make head?

way with his own client in coming to an amicable settlement if he can say that this information, drawn out by

(Please turn to page 62)

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missed. This emphasis may neces? sitate reassigning some of our assis? tants from civil to criminal matters. It

may even require a more fundamental

reorganization, such as assigning specific assistants to each courtroom. Our office structure will not change, however, until the real impact of the Act becomes clear through judicial interpretation.

Trial

Hall? k hi

(Continued from page 4)

him during a deposition, is a negative on the strength of his client's case.

Consider two other suggestions in the area of depositions. The first is the lost art of interviewing. It has been my experience, particularly in larger cases, that many lawyers seem reluc? tant simply to call up a third party wit? ness and ask to speak with him. It is true he may decline to speak with you, and you will have to consider whether

you will subpoena him. Often if you explain to him that an interview of a few hours at his convenience might avoid the necessity of a subpoena, and

possibly even the need for testifying, he will be willing to speak with you in?

formally. You might also consider whether he will agree to let you see

pertinent documents that might be in his files so that you can have a more

meaningful discussion with him. My only suggestion on asking for docu? ments is that as a general matter you attempt to be selective because you are putting the individual to a bur?

den, and if he must search extensive files, he will be less likely to speak with

you without a subpoena. An interview as a means of gather?

ing information can be a most useful and comparatively inexpensive de? vice. First, your adversary is not pres? ent, which can be a great benefit. Sec? ond, the notes taken during the inter? view can be as useful as any deposition in analyzing the information learned and considering the overall posture of the suit for negotiating a settlement. Of course, an interview is not directly usable at trial, and if the interview

yields pertinent information that will

be needed at trial, counsel must con? sider whether the third party witness can be subpoenaed or will agree to ap? pear at trial and, if not, whether his

pretrial deposition will be needed. But even there, that deposition will not be the long, drawn-out and some? times seemingly undirected deposi? tion that it might have been if you had not already spoken to the witness.

You should also consider interview?

ing third parties who have been sub?

poenaed by your adversary. Fre?

quently, it will help you to ask that witness informally about pertinent areas, and then to ask him at the

deposition only those questions that will provide useful answers for your client. There is an old trial adage that a good lawyer never asks a witness a

question to which he does not know the answer. I believe the adage applies to some extent at the deposition stage as well.

Another possibility in this area is, in the appropriate case, to ask your adversary for permission to interview

informally certain of the officers and

employees of his own client. If you agree to reciprocate with him, inter?

viewing certain of these witnesses on an informal basis will not only provide the exchange of information, but may let you avoid actually deposing per? sons who really do not have a suffi? cient nexus with the dispute.

Documents Without Talk When you serve a subpoena duces

tecum to obtain documents, you should consider whether to seek pro? duction by agreement without having the witness actually testify. Frequent? ly you only want the documents for leads they will give about other

witnesses, and it is not necessary ac?

tually to take the time and expense of

having the third party witness testify. If you obtain some documents that

you believe you will need as trial ex?

hibits, consider discussing with your adversary whether he will stipulate to their admissibility. If he will not, you can decide whether you can obtain the

admissibility of those documents

through some other witness either at the trial or during deposition, or whether you should actually take the

deposition of the third party. It may be that too many lawyers

view depositions as the main vehicle

for obtaining information about the

merits of their lawsuit. That view is incorrect and leads to many discovery abuses. A deposition's utility primari? ly should be its use at trial, either for its contents as direct evidence or for

impeachment. It is useful when you are trying to lock your adversary into a

position at an early stage. Where de?

positions are used to gather informa?

tion, they should be used only after interviews and document requests prove unsatisfactory. There is no

question that the main actors in any lawsuit will be deposed in any event, but you can significantly curtail un?

necessary depositions of marginal witnesses if you use other methods for

gathering information.

You can also obtain significant cost reductions by more frequent use, where allowed, of electronic taping to record the deposition. While many state discovery rules still do not en?

courage the use of audio tapes, agree? ment among counsel about their use or a motion to the court will frequent? ly make them acceptable. A regular stenographer employed by one of the

lawyers can transcribe only those

tapes that are needed, and, in many cases, that will help keep costs at a more manageable level. You should also consider taking a deposition by telephone so that you can question a witness in a distant city without a bat?

tery of attorneys traveling to that loca? tion. Videotaping trial depositions, while higher in initial cost, may also lower actual trial expenses, particu? larly those related to witness and law?

yer time, since the videotape may be a

satisfactory substitute for calling an out-of-state witness to appear at the trial.

This brings me to the area of overall

litigation management and keeping your client informed of developments as they occur. Often, much of the con? cern that clients express about the size of legal fees for discovery is not simply a belief that the lawyer did not do the work or that his rates are too high. Rather, they are not kept currently in? formed of developments. When they are advised after the fact, they are concerned about whether all of the de?

positions really needed to be taken. I believe that better communica?

tion with the client, be he an individ? ual or the general counsel of a multi million dollar corporation, will go a

long way toward a better understand

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ing of what is and is not to be done

during the discovery process. Not every case needs to be prepared

for trial or settlement by looking un? der every stone. Judgments should be made in consultation with the client about the expected utility of a partic? ular deposition and whether it is worth the cost. This may mean that a decision will be made that someone's

deposition will not be taken, which in turn means that you will not look un? der a particular stone. While this may create a risk that the nondeposed wit? ness may get on the stand at trial and

surprise you, I believe good prepara? tion of the underlying facts will mini?

mize these surprises and let you iden?

tify the important witnesses.

In some of the more complicated document cases, more effective use of

legal assistants and, where appro? priate, computer support systems will

go a long way toward reducing costs while providing an efficient means of

analyzing, cataloging and retrieving information. Making the client aware that legal assistants are an important part of your litigation support system will normally engender a favorable re?

sponse. Another suggestion stressed by the

Subcommittee on Reducing Costs of

Discovery was more attention to pre litigation discovery, and by that I

mean more attention to investigating the facts before a lawsuit is filed. Fre?

quently, suits begin in haste without a full consideration of the merits of the situation and all of the ramifications occasioned by filing a suit. The atten? dant publicity of such a suit often will cause your adversary to react more

strongly in defense of his position than if you had called up the adver?

sary and advised him of the possibility of a suit and asked to meet with him or his counsel. A number of lawyers re? vealed that they were able to work out with potential adversaries the mutual

exchange of information, including the taking of testimony from various

persons, all before any litigation is commenced and all at a time when the

respective parties had not cast their

positions in concrete. During this pe? riod each side may well have an inter? est in cooperating with the other to

provide a full exchange of informa? tion in an effort to head off a suit.

Once the suit is filed, it becomes, at least to some, a matter of public con

cern. Then a third party, the judge, becomes involved in the proceeding, and the interest of the court in moving that case along often works against the exchange of information and ap? praisal of positions in a settlement context.

Another practical point is the more

frequent use of fact stipulations. Keeping in mind the use of fact stipu? lations, you may well be able to nego? tiate with your adversary on, let us

say, a document request so that pro? duction is narrowed to only those doc? uments that will be necessary to let your opponent establish the particu? lar issue concerning him.

Many lawyers referred to more fre?

quent use of requests for admissions, particularly on the authenticity and

admissibility of documents. Expand? ed use of requests for admissions also can substantially reduce the discovery time spent on issues that are essential?

ly undisputed and can become the

predicate for stipulations of fact.

One final comment relates to inter?

rogatories?the most frequently crit? icized discovery device in the federal rules. There have been many recent

proposals to limit to some specific number the interrogatories allowable of right. Many federal judges already impose such limits as a matter of their own control of cases before them. The

pros and cons of the usefulness of in?

terrogatories is such a hotly debated issue and often so dependent on the

particular facets of a given case that I am not convinced there is any useful

purpose in putting a flat limitation on the number of interrogatories that could be served as of right. However, the thought that came across in many of the suggestions was that identifying witnesses and determining the loca? tion or use of documents are desirable

subjects for interrogatories. It may be that any numerical limitation should not be imposed on those types of inter?

rogatories, but only on those making substantive inquiries, where the law?

yers write the substantive answers in such a way that little if any informa? tion is conveyed.

All of the above suggestions, in the final analysis, require the willingness of bench and bar to be practical. On the subject of the bench, the most fre?

quently received suggestion was that

judges and magistrates should decide

discovery matters more promptly and

without the need for lengthy opinions. Reserving decision to write a com?

plete and scholarly opinion is often not a substitute for a ready decision from the bench, particularly when both lawyers are continuing to ham? mer each other nonstop in the in? terim. What the lawyers and clients often need is simply a decision draw?

ing a line that will be understood, ac?

cepted and followed thereafter. More effective use of federal magis?

trates on discovery matters, more

telephone conferences, less need for formal motion papers and the making of a magistrate's decision more ac?

cepted as a final decision on a discov? ery matter should assist in reducing costs. The more frequent use of ap? propriate discovery sanctions, under Rule 37 or otherwise, will also act as a harness on some of the more time

consuming yet unproductive discov?

ery moves now often treated as com?

monplace. For example, reallocating the burden of the expenses to be in? curred in answering lengthy interrog? atories when a simple deposition of a

person with knowledge of facts would

produce the same information should be part of the judicial arsenal. Con?

versely, consideration should be given by courts to reallocating expenses where, for example, the wrong corpo? rate official is produced and only after a number of wasted hours is it appar? ent that some other officer should have been produced. Since most cases are settled anyway, simply allowing many of these discovery costs to be treated as taxable costs after a final

victory cannot be a substitute for rec?

ognizing the impact of these costs as

they are incurred. A chapter from the

English on this subject may well be in order.

Big Firm

Litigation

(Continued from page 30) At that conference the appellate at?

torney, lead trial counsel, and Anwalt

participate in a discussion with the

plaintiffs' counsel and one of the

justices of the Seventh Circuit. The

purpose is to decide on a briefing

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