Business Law: Judicial, Alternative, and E-Dispute Resolution

Attorney Representation

• Hourly Rate:
  • Attorney is paid by the hour.
  • Typically requires a retainer.
• Flat Fee:
  • A set amount is charged for simple legal services.
  • Examples: wills, business formation, etc.
• Contingency Fee:
  • Lawyer receives a percentage of the amount recovered by winning or settling a lawsuit.
  • If the client loses, the lawyer receives nothing.

Case 3.1: Contingency-Fee Agreement

• Case: Goesel v. Boley International (H.K.) Ltd., 806 F.3d 414 (2015), United States Court of Appeals for the Seventh Circuit.
• Issue: Was the contingency-fee agreement enforceable as written?

Pretrial Litigation Process

• Litigation: process of bringing, maintaining, and defending a lawsuit.
  • Pleadings.
  • Discovery.
  • Pretrial motions.
  • Settlement conference.

Pleadings

• Paperwork filed with the court to initiate and respond to a lawsuit
• Plaintiff: Party who files a complaint.
• Complaint: Document a plaintiff files with the court and serves on the defendant to initiate a lawsuit.
  • Names the parties to the lawsuit.
  • Alleges facts and laws violated.
  • Adds a prayer for relief.
• Court issues a summons
  • Summons: Court order that directs the defendant to appear and answer the complaint.
• Answer:
  • Filed by the defendant.
  • Admits or denies allegations.
  • Can include affirmative defenses.
  • If all allegations are admitted, a judgment is entered against the defendant.
• If defendant fails to file an answer:
  • A default judgment is entered against the defendant.
• Cross-complaint:
  • Document filed by the defendant against the plaintiff to seek damages or some other remedy.
• Reply:
  • Filed by the plaintiff.
  • Serves as an answer to the cross-complaint.
• Intervention:
  • Act of others to join as parties to an existing lawsuit.
• Consolidation:
  • Act of a court to combine two or more separate lawsuits into one lawsuit.
  • This happens in situations when several lawsuits stemming from the same fact situation are filed against a common defendant.
• Statute of limitations:
  • Establishes the period during which a plaintiff must bring a lawsuit against a defendant.
    • Statute of limitations begins to run at the time plaintiff first has the right to sue the defendant
  • Plaintiff loses the right to sue when the lawsuit is not filed within specified period
  • Established for each type of lawsuit

Class Action

• Class actions occur when a group of plaintiffs with common claims collectively bring a lawsuit against a defendant
• Must be certified by appropriate federal or state court
  • Sufficient commonality among the plaintiffs’ claims is essential
• Class Action Fairness Act (CAFA):
  • A federal statute that requires certain class action lawsuits to be brought in or transferred to federal courts

Case 3.2: Class Action

• Case: Tyson Foods, Inc. v. Bouaphakeo, 136 S.Ct. 1036 (2016), Supreme Court of the United States
• Issue: Should the class be certified?

Discovery

• Legal process during which each party engages in various activities to discover facts of the case from the other party and witnesses prior to trial
• Purposes
  • Preventing surprises during trial
  • Allowing parties to thoroughly prepare for trial
  • Preserving evidence
  • Saving court time
  • Promoting settlement of cases

Forms of Discovery

• Deposition: Oral testimony given by a deponent
• Interrogatories: Written questions submitted by one party to the other party of a lawsuit
• Production of documents: Copies of all relevant documents obtained by a party to a lawsuit from another party on order of the court
• Physical and mental examination: Court-ordered examination of a party where injuries are alleged that could be verified by examination

Pretrial Motions

• A motion a party can make to try to dispose of all or part of a lawsuit prior to trial
  • Motion for judgment on the pleadings: If all the facts presented in the pleadings are taken as true, the party making the motion would win the lawsuit
  • Motion for summary judgment: No factual disputes to be decided by the jury and that the judge can apply the proper law to the undisputed facts and decide the case without a jury

Case 3.3: Summary Judgement

• Case: Wade v. Wal-Mart Stores, Inc., 29 N.E.3d 1141 (2015), Appellate Court of Illinois
• Issue: Should Wal-Mart be granted summary judgment?

Settlement Conference

• Facilitates the settlement of a case without trial.
  • Also known as a pretrial hearing.
• Informal conference held in judge’s chamber.
• Used to identify major trial issues and relevant factors when no settlement is reached.

Trial

• Seventh Amendment guarantees the right to a jury trial in cases in federal court.
• Jury trial is held upon the request of either party.
• When both parties waive their right to a jury:
  • Trial occurs without a jury
  • The judge sits as the trier of fact in nonjury trials.
    • Trier of fact: The jury in a jury trial; the judge when there is not a jury trial

Phases of Trial

• Jury Selection
  • Voir Dire: The process whereby the judge and attorneys ask prospective jurors questions to determine whether they would be biased in their decisions
• Opening statements
  • Each party’s attorney makes a statement that summarizes the main factual and legal issues
• The plaintiff’s case
  • Plaintiff bears the burden of proof
  • Direct examination
  • Cross-examination
  • Re-direct examination
• The defendant’s case
  • Defendant must:
    • Rebut plaintiff’s evidence
    • Prove any affirmative defenses
    • Prove any allegations contained in the defendant’s cross-complaint
• Rebuttal and rejoinder
  • Rebuttal: Made by plaintiff’s attorney to rebut defendant’s case
  • Rejoinder: Defendant’s response to Plaintiff’s rebuttal
• Closing argument
  • Each attorney tries to summarize their arguments and point out weaknesses of the other side’s case
• Instructions, deliberation, and verdict
  • Jury instructions: Instructions judge gives to the jury to explain how law is to be applied in the case
  • Deliberation: Jury goes into the jury room to reach a verdict
  • Verdict:
    • Civil case: Jury decides whether defendant is liable and assesses damages
    • Criminal case: Jury determines whether defendant is guilty or innocent; may assess penalties
• Entry of Judgment: The official decision of the court
  • Judgment notwithstanding the verdict
    • Judge may overturn jury’s verdict if s/he finds bias or jury misconduct
  • Remittitur
    • Judge may reduce the amount of monetary damages awarded by the jury
  • Written Memorandum
    • Sets forth reasons for the judgment

E-Courts

• Used to settle legal disputes via the Internet
• Allow online filing of pleadings, briefs, and other documents related to a lawsuit
• Evidence and documents can be scanned for storage, retrieval, and e-mailing correspondence and documents to the court
• Scheduling and other conferences with the judge are held via telephone conferences and e-mail

Appeal

• Act of asking an appellate court to overturn a decision after the trial court’s final judgment has been entered
• In a civil case:
  • Either party can appeal the trial court’s decision
• In a criminal case:
  • Only the defendant can appeal
• Appellate court will:
  • Reverse lower court decisions for errors of law
  • Reverse finding of fact made by a jury or judge only when it is unsupported by any evidence
• Appellant: The appealing party in an appeal
• Appellee: The responding party in an appeal

Alternative Dispute Resolution (ADR)

• Methods of resolving disputes other than litigation are:
  • Negotiation
  • Arbitration
  • Mediation
  • Mini-trial
  • Fact-finding
  • Using a judicial referee

Negotiation

• Parties engage in discussions to try to reach a voluntary settlement
• May take place at any level of litigation
• Parties make offers and counteroffers to one another
• Settlement-agreement:
  • Voluntarily entered into by the parties to a dispute on reaching an agreement

Arbitration

• Parties choose neutral third party to hear evidence and testimony and decide the dispute
• Common in commercial and labor disputes
• After an arbitration hearing is complete:
  • Arbitrator makes a decision and issues an award
• Arbitration can be binding or nonbinding
• Arbitration clause:
  • Requires disputes arising out of the contract to be submitted to arbitration

Arbitration Procedure

• Party must give notice to the other party
• Parties then select an arbitration association or arbitrator, and agree on the date, time, and place of the arbitration
• After an arbitration hearing is complete, the arbitrator reaches a decision and issues an award
• Federal Arbitration Act: Statute that provides for the enforcement of most arbitration agreements

Case 3.4: Arbitration Agreement

• Case: Kindred Nursing Centers Limited Partnership v. Clark, 137 S.Ct.1421 (2017), Supreme Court of the United States
• Issue: Is an arbitration agreement signed by an attorney-in-fact enforceable where the attorney-in-fact has been granted broad powers to sign contracts?

Mediation

• Parties choose a neutral third party to assist them
• Settlement is reached through intermediation
• Mediator is allowed to give opinions to either party
  • Does not make judgment or issue award
• After discussing facts of the case with both sides, the mediator encourages settlement of the dispute and transmits settlement offers to each party

E-Dispute Resolution

• Use of online alternative dispute resolution services to resolve a dispute
• Electronic arbitration
  • Requires the registering party to submit an amount that the party is willing to accept or pay to the other party in the online arbitration
• Electronic mediation
  • Mediator engages in an online conversation with both parties