Lawsuits have become a common occurrence in our society, with individuals and businesses resorting to legal action to resolve conflicts and seek justice. However, one of the significant concerns surrounding lawsuits is their exorbitant cost. From attorney fees to court expenses, the price tag associated with litigation can be astronomical. In this article, we delve into the reasons why lawsuits are so expensive and explore some potential solutions to mitigate these costs.

  1. Legal Expertise and Professional Fees: One of the primary reasons lawsuits are expensive is the need for legal expertise. Attorneys spend years studying and honing their skills to navigate the complexities of the legal system. Their expertise comes at a price. Legal professionals charge high fees for their services, considering the time and effort invested in building their knowledge and experience. These fees can quickly accumulate as a lawsuit progresses, leading to substantial expenses for both parties involved.
  2. Time and Resources: Lawsuits can be incredibly time-consuming and require significant resources. Attorneys and their teams invest countless hours conducting research, gathering evidence, preparing legal documents, and strategizing their approach. Additionally, lawsuits may necessitate the involvement of expert witnesses, investigators, or consultants, further driving up the costs. The time and resources invested by legal professionals contribute to the overall expense of litigation.
  3. Court Costs and Administrative Fees: Courts impose various fees and charges to cover administrative costs. Filing fees, motion fees, jury fees, and other expenses add up quickly. These costs are essential to keep the judicial system functioning, but they can place a heavy burden on litigants. Furthermore, as cases progress, additional fees may arise, such as costs for court reporters, transcription services, or obtaining certified copies of documents. These expenses can be substantial, especially for protracted or complex lawsuits.
  4. Discovery Process: The discovery process, which involves gathering and exchanging information and evidence between the parties, can significantly contribute to the expenses of a lawsuit. This process often involves depositions, interrogatories, requests for production of documents, and expert reports, all of which require extensive time and resources. Attorneys must thoroughly review and analyze the received information, further adding to the costs.
  5. Appeals and Post-Judgment Proceedings: Even after a judgment is rendered, the legal process may not be over. Parties dissatisfied with the outcome may choose to file an appeal, initiating another round of litigation. Appeals can be even more costly than the initial lawsuit, as they involve additional research, briefing, and oral arguments before an appellate court. The expenses continue to mount with subsequent post-judgment proceedings, such as enforcement or collection efforts.

Addressing the Cost Issue

While the high costs associated with lawsuits can seem daunting, efforts are being made to address this issue. Here are some potential solutions:

  1. Alternative Dispute Resolution (ADR): Encouraging parties to explore alternative dispute resolution methods, such as mediation or arbitration, can help reduce costs. These processes offer a more streamlined and cost-effective approach to resolving disputes outside of the traditional courtroom setting.
  2. Legal Aid and Pro Bono Services: Expanding access to legal aid and pro bono services can help individuals with limited financial means gain access to legal representation. Increasing funding for legal aid organizations and encouraging more attorneys to provide pro bono assistance can alleviate the burden on those who cannot afford high legal fees.
  3. Legal Reforms: Continued efforts to reform and streamline the legal system can contribute to cost reduction. Simplifying complex legal procedures, introducing electronic filing systems, and promoting efficiency within the courts can all help mitigate the expenses associated with lawsuits.
  4. Fee Structures: Exploring alternative fee structures, such as contingency fees or fixed fees, can provide more predictability for clients and potentially reduce costs.

Conclusion

lawsuits are expensive due to factors such as the need for legal expertise, extensive time and resource investment, court costs, the discovery process, and post-judgment proceedings. However, efforts are being made to address this issue by promoting alternative dispute resolution methods, expanding access to legal aid and pro bono services, implementing legal reforms, and exploring alternative fee structures. By striving for a balance between access to justice and cost management, we can work towards a legal system that is more affordable, efficient, and accessible to all.

Video Transcript

Why are lawsuits so expensive? Quite frustrating. When I was first involved in politics and government, shortly after high school, I thought to myself justice should be swift. Our founding fathers talked about how quick justice should be. It shouldn’t drag on. There is such a problem in the court system with the fact that these cases go on for a year and sometimes many years. People have a right to get resolution to their issues promptly, not delayed over time.

Why Are Lawsuits So Expensive?

It is because we put, as an American society, we put justice as more important than efficiency. Because let’s face it, let’s say you had a trial that happened a day after, or let’s say a week after a lawsuit was started. On the one hand, that would be really efficient. That would be great. The lawyers couldn’t bill $100,000. There is only seven days in a week, and the parties who are in the lawsuit would have finality. At least we would have a court decision in that case.

But Here Is the Problem

Would there be justice done with the parties have had time to gather all the evidence, interview all the witnesses, and prepare those witnesses and the evidence for trial? No, you can’t possibly do that in a week, especially in big cases. Imagine there’s 100,000 documents, or imagine you have to get emails off an email server at a company which takes time just to get them. Then you have to review them. Then you have to see how they are relevant to what individuals knew, then you ask those individuals questions, you might have depositions to do that. Then once you have gathered all this information, you might even find out that there is more information out there. Like, Oh, there are a few cell phones that will have information that were deleted from the email server. We need to go get that. So you can see how this goes on. This is called discovery. It is where the parties are discovering information.

You need to have some time to do that, and then the parties that need to have time to process it and put together their arguments and address legal issues prior trial. And those are presented to the judge in the form of a motion.

Then you need to prep for trial and go to trial. And by the way, there should never be surprises at trial. I love the surprises that happen at trial on TV, but that is called ambushing someone, and it is generally prohibited in real court systems, not on TV. So, everything needs to be exchanged well in advance of trial. The parties exchange all the evidence, the list of witnesses, and many times what those witnesses are expected to address.

Then finally, you prepare for trial, you coordinate schedules with everyone, and you have your days of trial.

So, that is why, in general, lawsuits do need to take somewhere between nine months to a year. Now you might say, “Well, I know a lot of cases that take a lot longer than that, and they are a lot more expensive than that.” That is true, but that is usually because one party is trying to find a lot of things to fight about. There is a lot of money at stake. And everything involves lawyers doing a lot of work.

So, for example, if you are talking about one of the big oil companies or big tech or something like that, or a class action case, that is going to take a significant amount of time.

So Why Are Lawsuits So Expensive?

Well, every single stage of this effort needs to either be done by you for free. In other words, you don’t have to pay yourself. So you save money from hiring an attorney, or you hire an attorney. If you hire an attorney, the attorney is spending hours doing all of these things, gathering the information, reviewing it, meeting with you, putting together arguments, writing up those arguments for the court, presenting them, waiting for the court to rule, maybe having another motion to the court, presenting those arguments, waiting for the court to rule, coming on back.

You might have many motions prior to actually getting ready for trial. In fact, it is very typical to have motions and a motion itself can cost five to $10,000, and that is fairly common because you need to present all the arguments so you don’t lose. You can’t just say, “Oh, the judge will get it. The judge will understand.” No, you have to present the arguments for the judge to consider, and then the judge can adopt those arguments in the order.

So unfortunately, with these motions, both parties have to respond, and it takes time, and it takes effort, and it takes investment. And if you are hiring an attorney, it takes an attorney to do that. If you are doing it on your own, not only is the quality going to be much worse, but you are going to be trying to figure out the law as you go. And when we take into account attorneys have gone to three years of law school, plus then typically a number of years practicing under a senior attorney to learn, you are trying to get a lot of that learning relevant to your case in a very short amount of time.

Transactional Attorneys

By the way, did you know that many attorneys don’t go to courtrooms? They are called transactional attorneys. They will just tell you, “I don’t litigate. I don’t go to the courtroom.” Why? Because they may know the topic of law, but there is a whole different set of rules and laws related to how things are handled in the courtroom. There is a set of rules called the rules of evidence. There is a set of rules called the rules of civil procedure. There may also be other rules, like the rules of general practice. Then individual districts may have their own rules, and individual judges might have their own rules. And so that is why not even every attorney is willing to go into a courtroom. It just emphasizes the amount of information that needs to be learned and processed and applied if you are trying to represent yourself in court.

There is an old saying an attorney who represents himself in court has a fool for a client. Why? Because even attorneys need attorneys. Somebody who can see objectively and represent them without the emotions and the distraction of the narrow perspective that the person has. You need somebody who is objective and can think about what does the judge need to see?

Conclusion

We have covered all the questions we have time for today. Love to have you at a future live session if you would like to know about these and by the way, they are usually not available in full online unless you hop onto them live, then you can watch them.

But if you would like to be part of the next one, feel free to register at aaronhall.com/free. You will get on our free newsletter, doesn’t come out that often, and it is all about delivering important value to you. Educational information that will help you avoid problems in your company and improve your life. Go to aaronhall.com/free if you would like to get notified about the next time we are going live. It was wonderful being here with you today. Please feel free to check out this YouTube channel and subscribe if you are interested in other educational information for business owners to bring more success to your company in life. Have a great day.