It's always a challenge to have to manage client expectations when it comes to lawsuits, because what people believe they should be allowed to sue for and recover in a lawsuit doesn't match up with the way the law actually works.
I'm going to tell you a little bit about what type of damages you can recover or what type of victory you can claim in a lawsuit in Pennsylvania. It may be different in other states, but I'm not licensed there.
In general, when it comes to business disputes, such as disputes between partners, businesses, vendors, employees, or contractors, you'll typically file a lawsuit in the Court of Common Pleas if the amount at stake is over $12,000. You'll be suing for monetary damages.
A lot of people think lawsuits are quick and easy. They think it's just a matter of filing some paperwork, getting in front of a judge and/or a jury, and getting your verdict. The reality is that lawsuits take years. In fact, it's pretty surprising if a lawsuit takes less than a year.
So, warning number one: keep in mind that somewhere between 97 and 99% of lawsuits get settled before they ever go to a jury. They may get settled before a lawsuit is filed, they may get settled shortly after, or they may get settled after years of litigation. But most cases get settled.
And when a case gets settled, typically, that means both sides have made some sort of compromise. Maybe the defendant has been willing to pay more than they think they owe. Maybe the plaintiff has been willing to accept less than they think they're owed. But that's the reality of most lawsuits. The skill of a litigator is often in negotiating and posturing, not necessarily in putting on a show in a courtroom.
A lot of people also think they can sue to recover their attorneys' fees. So if they have to pay a lawyer to file a lawsuit and go to court, they think that those fees are recovered. In most cases, they're not, though, and that's one of the most disappointing things to a lot of clients.
I can be heartless about it and say, "Listen, hiring a lawyer is the cost of doing business. You have to have some budget for either transactional work, to set up your business or preventative work to avoid lawsuits, or to actually get involved in litigation." And unfortunately, in most instances, you've got to pay for your own lawyer.
Now, there are exceptions to that with certain types of lawsuits, which is way too much detail for this video. And there could be insurance coverage; sometimes your insurance company will actually provide a defense for you. Sometimes you get to pick your lawyer, and sometimes you don't. But you may not have to go out of pocket as much to hire a lawyer to defend you.
So that's a big one, right? Because attorneys' fees in lawsuits can be $10,000, $20,000, $50,000, or even $100,000, depending on the complexity of the case. And if you look at some of the famous lawsuits that you see in the news, like the Johnny Depp and Amber Heard case, that case went on for like three or four years before it ever saw a jury. I mean, those lawyers... you think about how long that trial lasted, how many witnesses they called. Each and every one of those witnesses had to be prepared. They probably had a deposition taken at some point in time, meaning they already testified under oath in front of a court reporter. So there are significant costs that can go into a trial like that, like any trial, any lawsuit.
So I think a lot of people get disappointed about that. And I think a lot of people also hear about these really big jury verdicts or these big settlements, especially when it comes to car accident cases, which is not the type of law that we do. And they hear things like punitive damages, meaning one company is going to be punished for their actions. So there's compensatory damages, meaning you get paid back what you think you've lost or a portion of that. And then there's punitive damages, and that's to punish, and that's to send a message to other potential defendants or bad actors.
And I think a lot of people hear about this, and they think, "Wow, there's going to be a lot of money at play." However, in most business disputes, you cannot recover punitive damages. Most business disputes are considered breach of contract claims, so you can typically only sue for compensatory damages, or the amount it would take to make you whole. This means that you may not be able to recover your attorney's fees, and you certainly cannot recover punitive damages.
In many lawsuits, people are looking to recover less than what they are actually owed. However, they hope to recover more than zero, and that the lawsuit will not cost them more than what they recover. It is usually impossible to tell earlier in a case how much you will recover.
Lawsuits are obviously much more complex than this. For example, you may be able to sue for specific performance, which means that you can force the other party to fulfill their contractual obligations. However, this is rare. In most business relationships, if someone fails to perform their obligations, you will likely only be able to sue for monetary damages.
There are many options when it comes to lawsuits. It is important to understand all of your options, as sometimes you can recover attorney's fees or punitive damages. There are also protections that you may have or steps that you need to take in order to recover the damages that you are owed. If you have any questions about lawsuits, please reach out to us. We can answer your questions and walk you through your specific scenario. Every case is different, so it is important to get specific advice.
Please reach out if you have any questions!