Frederick Penney Reveals How The Pandemic Helped Businesses Save Money

SACRAMENTO, Calif., Feb. 25, 2021 /PRNewswire/ -- An experienced managing partner of arguably one of the most successful law firms in California weighs in on how the court system has changed to the advantage of the insurance industry and large and small businesses. See: https://www.penneylawyers.com/ .  The statistical data used and personal experience dealing with the pandemic within the court system gives Frederick Penney a unique prospective on this issue. The pros and cons of how these changes affect the average consumer are also discussed.

Staggering Statistics

Attorneys, plaintiffs, and defendants are becoming more and more frustrated due to lack of access to the court system.  Understandably the courts cannot function like they used to prior to the pandemic.  As the managing partner and trial lawyer for Penney and Associates law firm in California, I can relate to the frustrations the public, courts and businesses feel.  I believe many non-attorneys would say that this is a good thing that the access to the courts is limited so parties are more hesitant to bring lawsuits or will be more motivated to settle their cases.  With over 28 years of experience as a trial lawyer I know that the way to get cases settled is to have a sum certain trial date.  Many of the cases settle when the reality for both parties that they are about to put their fait into the hands of 12 jurors or a judge looms just over the horizon.  Now that the added pressure of courts all but closing their doors for civil trials, the pressure of settling immediately prior to trial is now off.  Now cases seem to be dragging on longer as trial dates get pushed out later and later hoping the pandemic will have disappeared.  For example, according to the Judicial Council of California from March 2019 through August 2019 Alameda County was able to accommodate 115,671 trials (in one form or another).  Whereas from March 2020 through August 2020 Alameda County was able to accommodate only 57,095 trials.  This is a staggering 50.6% decrease in trials.  The worst in California was Sacramento County that had a 72.9% decrease in cases going to trial from the same time period mentioned above.   See: https://www.courts.ca.gov/documents/jbbc-20210105-materials.pdf.  Without belaboring the point and researching every state's decrease in cases going to trial during the pandemic, I am sure that in some states there were substantial decreases like those noted above.

How Do Businesses Save Money

So how does the decrease in cases going to trial and the courts being essentially closed for civil trials help business save money?  The answer is easy, in expert and attorney fees and costs.  First the courts are now turning to Zoom or some similar platform to perform necessary duties such as settlement conference, status conferences, arguments concerning certain motions before the court or any other court mandated hearings. https://zoom.us/ .   The courts have also relaxed the requirements of service and rules concerning depositions to accommodate the ability of attorneys and their clients to still proceed with the litigation portion of the case (note, this is performing the work before the trial) while still in lockdown or having limited access to travel and the courts during the pandemic.  This was evident the other day when my partners and I were discussing the latest status of cases and the cases that were being prepared for trial.  During this discussion is when I knew I had to write about how the pandemic will help businesses save in attorney and expert fees and costs. 

Normally when experts are used for a trial their depositions are noticed and either the expert must fly out to a place where the attorneys have designated for the deposition or the attorneys must fly to the expert's hometown to take their deposition.  Many times, the experts are not even located in the same state of the attorneys.  Thus, if you are an attorney that charges by the hour, you usually charge for travel time and expenses.  These expenses could be the cost of hotels, airline flights, rental cars, and other sundry items.  Even attorneys that are paid on a contingency fee basis still charge expenses to the file such as flights, hotels, rental cars, and gas.  Many times, one expert deposition could take a full day if you include the travel time.  Or, if the expert must travel to have their deposition taken then they would also charge travel time and expenses. 

The new norm is to take the deposition of experts via Zoom and attorney's can at times take two or three depositions in one day from their office or home.  In one of our cases there are over 50 expert depositions that need to be taken and the attorney's and experts were able to perform theses depositions expeditiously using Zoom.  This I believe will be the new norm and standard as the time and expenses saved by having the attorneys and experts not traveling will save clients and business an enormous amount of money.  This also goes for the insurance industry that at times pay outside counsel by the hour (note some insurance companies have in-house attorneys a salary to represent their policy holders).

Though this has helped business, it is no surprise that it has put pressure on law firms that have less work due to the process of litigating a case becoming more efficient.  I have personally known of law firms that are laying off lawyers or breaking up due to the decrease in work.  Moreover, there just is not as much work out there than prior to the pandemic.  A quick example would be in the field of personal injury.  The lawyers in our office have been advised by insurance representatives that on a given month there may be up to 50% less injury claims than the same time in 2019.  Many would agree that is a good thing, which one cannot argue.  Recent discussions with attorney's practicing areas of law other than personal injury are finding that the personal injury lawyers are now moving into their space.  According to the Consumer Federation of America in Colorado, Maryland, Massachusetts, and Texas. there have been 23% fewer accidents in September and October 2020 as compared to 2019.  Most other states do not have their statistics up to date.  In fact, during March through October 2020 Texas saw over ninety-seven thousand less accidents than the year before.  Clearly with a substantial decrease in claims the insurance industry has given most auto insurers a few months of premium credits.  Only time will tell if that is enough credit to the consumers.  See:  https://consumerfed.org/press_release/auto-insurance-refunds-needed-as-new-data-show-crashes-remain-well-below-normal-due-to-pandemic-23-fewer-accidents-in-september-and-october/  .

What Does the Future Hold

What does this mean in the long run?  Possibly a decrease in law school admissions, a decrease in the job opportunities for lawyers and possibly the decrease in lawyers' and experts' billable rates?  As is in most industries the best lawyers will more than likely survive and have plenty of business, but those at the bottom of the spectrum my be finding that they will need to diversify.  As with most professions there has been a decrease in work since the Pandemic.  Will it come back?  Will the amount of work for lawyers and experts in the legal business find an increase of work after the pandemic?  As of February 2021, it looks like the amount of work for lawyers is not increasing and possibly the pandemic may have weeded out many lawyers that were successful just due to the glut of work available for them pre-pandemic.  Only time will tell.

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SOURCE Penney and Associates