Why are lawsuits so expensive?!?

There’s no doubt that we are a litigious society, and the reality is that the legal system probably works better for people with the financial means to afford it than someone equally deserving but with less resources. But this isn’t an op-ed about what we can do to change a potentially broken system, this is simply a look at what makes a civil personal injury lawsuit so darn expensive in the real world.

Also worth noting here is that attorney fees are separate from costs. Costs are paid to a third party (like a doctor or other expert witness) in order to advance and support your claim, whereas fees are what you pay to your attorney as compensation for their time and representation. Per Colorado Rules of Professional Conduct, all case costs must be the responsibility of the client, not the attorney (even if the attorney advances some costs he/she will get reimbursed by the client out of any settlement funds).

Anyone involved in a civil dispute who is debating on whether to sue someone or just try to settle it out outside the courtroom should carefully consider the amount of attorney fees and case-related costs before making any decisions:  

Court filing & service fees:

The first step in a lawsuit is filing papers with the Court, and these costs can range from under $100 to about $500 depending on which Court you’re in and whether you are requesting a trial to a jury or a Judge. Then you have to serve those papers on the other party, which can cost about $50-$100 if you hire a professional process server.

Costs of discovery:

Discovery is the part of a lawsuit where both sides find out, or ‘discover,’ what the other side knows so that nobody is surprised at trial (that only happens in movies and t.v. shows!). Depositions are one type of discovery available to your attorney.

Attorneys can take depositions of “lay” witnesses, which are witnesses that may provide key facts in the case. This would include the Plaintiff and Defendant themselves, the investigating police officer, friends, family, co-workers, eye-witnesses, etc. Costs of each deposition, which include fees for the court reporter, transcription, and sometimes videographer, depend on whether you or the other side is requesting it and how long the deposition lasts. Depositions of lay witnesses can typically range from $200 to $500 per witness, which is mostly made up of court reporter and transcription fees. 

Attorneys can also take depositions of “expert” witnesses, which are witnesses that are allowed to provide key opinions in the case because of their unique experience and expertise in a particular field of science or study. Depending on your case, these experts may include, for example: 

  • Legal Nurse Consultant,
  • treating doctors & medical professionals,
  • specially-retained medical professionals,
  • Traffic Accident Reconstructionist,
  • Biomechanical Engineer,
  • standard of care expert,
  • Economist,
  • Vocational Rehabilitation Counselor,
  • Life Care Planner, etc.

Depositions of expert witnesses are much more expensive and can typically range from $1,000 to $5,000 per expert witness, which may include fees charged by the court reporter, videographer, as well as fees charged by the expert for their time spent both preparing for and actually attending the deposition.

Expert witness costs:  

Other than the costs of taking an expert’s deposition during a lawsuit (see above), experts will typically charge several thousands of dollars for the initial case review and a written report of their findings and opinions. It is not uncommon to spend $3,000-$5,000 per expert before you even get to their deposition. Then, if the case makes it all the way to trial (the last step in a lawsuit), there are the costs of preparing each expert for trial and having them attend and give testimony at your trial. An expert will typically charge higher than their standard rate for testifying at trial, so a client and his/her attorney can expect to pay at least $5,000-$10,000 per expert for their time and testimony at a trial. The fees that expert witnesses charge are not regulated by law and are based mostly on their experience and reputation in the community. An expert witness relatively new to the field may charge $250 per hour, while an expert witness with 30 years of experience and a good track record may charge $500-$1,000 per hour.

While it is true that an expert witness can make or break your case, your attorney must be careful not to let the costs get out of proportion with the estimated value of your case. The type and number of expert witnesses your case will require depends on your specific circumstances, the expected value of your case, and your attorney’s best judgment. Your attorney must be fairly confident that the value the expert adds to your case will be more than his/her charges.

Miscellaneous costs:

At trial your attorney may want to hire an audio visual (AV) technician to make sure everything runs smoothly and all the equipment (i.e. projector, screen, laptops/tablets) is properly set up and talking to each other. Other litigation costs may also include processing charges for medical records, travel costs, etc. 

So what am I looking at in TOTAL COSTS?

If your case is simple and straightforward (they rarely are) and maybe you only need one doctor (‘expert’ witness) to testify at your trial, you might be able to spend as little as $5,000-$10,000 in costs from the beginning of the lawsuit (filing fees) through to the end (expert witness deposition and trial testimony charges). As discussed before, this amount does not include how much you would also have to pay your attorney in contractual fees. On the other side of the spectrum, if your case involves complicated medical treatment or complex legal issues, you’ll need to hire or consult with several expert witnesses to “prove” your case and you could expect to incur $40,000-$80,000 in case costs by the end of trial. Again, this amount would not include whatever fees you have agreed to pay your attorney as compensation for their work.

What if I win my case?

If you go to trial and win your case, you should get all or most of your costs (not attorney fees though) reimbursed by the other side (assuming they have the money or insurance proceeds to cover it). It’s worth noting here that if you settle before trial, you generally don’t get your costs reimbursed (but you generally have much less costs because you didn’t need to go to trial).

What if I lose?

If you go to trial and lose your case, you (not your attorney) are personally responsible for not just your attorney’s unpaid/unreimbursed costs, but also the costs that the other party’s attorneys spent in defending against your claim. And since the Defendant is almost always represented by insurance company attorneys, you can be sure that they have the resources and motivation to sue you for every penny of their costs if you lose and can’t or won’t pay them.  

 

Obviously, every case is different and some of this article may not apply to your case. If you have any questions at all about your specific situation, please feel free to comment below or call Gama Law Firm and speak with me at no charge.


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