This story is part of our Lawyer Stories series which shares vignettes of one’s high and low (and sometimes even funny) moments in the legal profession.
Soon after we started our firm, we had a few cases against a major corporation. We had three very expensive trials lined up against this corporate defendant coming up, one right after the other.
Prior to the start of the first trial, we made a settlement demand on behalf of all three cases. We basically told them this was a “take it or leave it” offer; we would accept nothing less and no counter offers. The following day, at the mediation, the company’s lawyer said that the numbers we suggested were “in the wrong universe,” and if we wanted to talk, we needed to come back with an offer that was much lower.
Not only had they disregarded what we said about not accepting anything less, they spoke to us as if they assumed we were amateurs who would bid against ourselves. So, I told them we’d come back with a different number.
We met with our clients, got approval from them, and came back with an amount that was about ten times larger than the original one. The attorneys for the corporation were enraged and immediately started berating us. We left mediation and went to trial.
We were a new firm and we knew it was going to cost a lot of money to try these cases against such a large and powerful defendant. During a meeting with one of the representatives for the defendant, he told me his company had enough money and manpower to fight every single case and appeal as many times as necessary.
He said we had no idea how costly it was to run a law firm; they would bankrupt us before the year was out and it would cost them nothing. We disregarded this “advice” and figured the rep was just trying to intimidate us.
On the eve of closing, after what had been a really successful trial for us, the corporation offered a settlement that was significantly higher than our first “wrong universe” demand. We got the money our clients deserved, and we didn’t go bankrupt in the process.
However, at the end of the year, when we went through our numbers, we realized the corporation had been right. If the defendant hadn’t lost their nerve and agreed to settle the cases, we would’ve had a cash flow problem. Our lack of experience had given us the false confidence we needed to make the defense think we were crazy enough to fight them.