Dennis Prager Interview

Litigation Department chair Jeff Kramer was interviewed by Dennis Prager on morality in the legal profession and the concept of "loser pays."

Dennis Prager: I have a lawyer on, and we're going to talk about the whole question of morality and lawyers. One of the subjects that has come up regularly is my view of the legal profession. In fact, I even gave a speech at a law school – why law school makes you a worse person. I think people know my views of lawyers. Obviously, I'm not a nut. I know that we need lawyers and I know that there are some wonderful ones out there. As it happens, I think I came in contact with some, because I did need some legal work, and I was touched by not only their competence – there are many competent lawyers presumably, although there are many incompetent ones too – but also it struck me that wherever possible they went for less money from their client (me), and I was moved by that. It seems to me that a lawyer can easily keep making money, because they charge by time, so the more time they spend on your case, the more money they make. Anyway, the firm was TroyGould, which obviously I felt very positively disposed toward, and the lawyer specifically is Jeff Kramer. Jeffrey, welcome to the Dennis Prager Show.

Jeff Kramer: Thank you. Very nice to be here.

DP: Let me ask you about this whole phenomenon. Is there, to be honest, a pull in a lawyer – if I do more hours, I make more money, so isn't there a temptation to do more hours?

JK: There might be for some lawyers, but I don't think there are for most lawyers. For one thing, you can't be a lawyer without integrity, and maybe that's a controversial idea. At least if you want to be a lawyer for the long term, you have to have integrity. Even in this day of advertising, most lawyers get their business from referral sources – people who have been satisfied with what their lawyers did for them – so if you want your client to be satisfied, they have to be satisfied that you've been straight with them, that you've been honest with them and that whatever service you're rendered for them they've gotten fair value for it, and I think most lawyers understand that, and they have their eye as much on the next case and the next matter as they do on the one they're handling at the current time.

DP: Then, let me ask you, when you hear lawyer jokes – and I want to say a word about lawyer jokes, because I have a theory that the best humor is the most bitter humor in any given society. That's why the best jokes of my life are always Soviet dissident jokes. In America, the funniest jokes tend to be lawyer jokes. Why is that? Why do you guys have the reputation you have? Is it undeserved?

JK: I think it is underserved. I think in part people blame the messenger. Lawyers represent the interests of others; they do what their clients want them to do to the extent that it's ethical to do that. They are champions for their client's cause, and it's remarkable how often it happens – and I see it all the time – that my clients, for example, will demonize the lawyer on the other side of the case. That lawyer is just doing his job. That lawyer is representing his or her client's interest, but my client sees that as something evil in the other lawyer, and demonizes the other lawyer.

DP: Have you ever felt that you were up against a lawyer who was somewhat demonic?

JK: Unfortunately, there are those out there. There's no question about it. There are those who employ that as a tactic, and that is part of their stock in trade. You have to realize that. A savvy lawyer will understand that, and get over the personality issue and understand that the other lawyer is behaving badly – often as a tactic to achieve his objective – and figure out what the best response is.

DP: Now, you're in the trial bar. Obviously, it's trial lawyers that have the toughest reputation, as it were. And even among you, there are levels to the nonlawyer, like many of the folks in personal injury law. Didn't you hurt your neck in that accident? How much of that is there?

JK: Again, lawyers are not perfect – they're like the rest of human beings. There are very fine lawyers, and lawyers not so fine. But again what the lawyer is doing is trying to advance his client's interest, trying to assess the facts – if it's personal injury, what are the injuries – and get the best results for the client. The system tends to work. If someone if faking an injury, it tends to come out in the litigation process. The whole idea of lawsuits is that the truth comes out from two sides competing very vigorously to present their side.

DP: So, you're in corporate law?

JK: I would say more broadly, business law.

DP: Does TroyGould specialize in that, or is it larger than that?

JK: We are a law firm for business. Everything we do is service rendered to business in one form or another.

DP: I'm curious – does it ever happen that you tell a client, with all due respect, you don't have a good case?

JK: Yes, that happens more often than you would think it does. Because, once again, if you don't tell a client the bad news early on, you're going to have a very unhappy client down the road.

DP: Here's a human question that I've always wondered. Do you ever have a client wherein your passions are aroused, God, this guy is really, really right – I really want to win for him?

JK: Yes, that happens frequently, and that's when practicing law is most enjoyable. You've got a client you really believe is right, and you have the privilege of helping him prevail. That's what makes it exciting.

DP: And do you ever have, on the other hand, look, it's my job to work for my client, but the truth is my client is a jerk?

JK: Yes, I've had a few of those too. You take your satisfaction out of doing the most professional job you can.

DP: All right, when we come back, I want to ask you your thoughts on loser pays. I have no idea what you'll say; I'm very curious. I've been speaking to Jeffrey Kramer, whom I've come to respect along with his firm TroyGould.

Dennis Prager, here. Talking to a lawyer and a firm that I came to respect – Jeffrey Kramer. The firm is TroyGould. I'm bouncing some of my questions about the legal profession off him. I left you with the question of your position on "loser pays."

JK: It's not a one-size-fits-all question because it has different impacts in different areas of the law – in the area of personal injury law where you've got lawyers taking matters on contingency for people who've been badly injured or maybe sometimes not so badly injured. The idea of "loser pays" there would have a very negative effect on the ability of those lawsuits to move forward, and to the extent that you believe the majority of those lawsuits are doing good for people who have been injured, it has a negative effect. The idea of "loser pays" in the business context, which is where I see it more often, actually has the opposite effect. The idea that the loser in a lawsuit is going to pay the attorneys' fees of the other side tends to make a lot of cases affordable for lawyers where they wouldn't otherwise be. Because if you've got somebody who has a claim, let's say against a big corporation, and the dollar claim is maybe marginal, maybe not enough to support what a lawyer knows is going to be very intensive litigation by a very well heeled defendant, the fact that there is the ability to recover attorneys' fees if you win the case makes lawsuits more economical than they otherwise would be for the underdog in a business context.

DP: Well, only if the underdog prevails.

JK: That's right.

DP: And, if he doesn't prevail, it would seem to me that it would force attorneys to take cases where they thought they had a chance, and the more frivolous lawsuit would then not be taken up by an attorney.

JK: Yes, that's true, but again, one thing to remember is that certainly in a business context, and even more generally, in civil lawsuits, most cases settle. And more than most, the figure is over 90% of the cases, settle. So as a practical matter, what the "loser pays" does is that it changes the dynamic in the settlement negotiation, and it increases or decreases the amount of the settlement, but unless a case is incredibly frivolous, if a case has any merit at all, or any possibility of having merit, that case is likely going to settle before it goes to trial, and the defendant in the case is going to pay something to make the case go away. And so, as a practical matter, "loser pays" in that setting never really plays itself out. It may serve to reduce the amount of recovery that a plaintiff will obtain, but it doesn't usually result in the plaintiff . . .

DP: I was on the board of a nonprofit religious school. In their first years, they were located on some land that they had rented, as it were, and it had a slight hill. They hired a woman as a secretary. She then sued them within the first week because she had to walk uphill to the ladies room, and she claimed a disability. And, of course, the school settled because just to litigate and win, you still lose because you had to go through litigation. That's the reason people settle so often.

JK: Yes, there's no question about that. That is the reason that many lawsuits settle. Clients will make rational economic decisions . . .

DP: Right. But if loser paid, they wouldn't settle necessarily.

JK: Well, in those kinds of situations, they probably still would, because the choice they would be facing would be not settling; spending substantial money that it takes to go to trial, taking the chance that they might lose, and there's always that chance in the litigation process; then recovering an attorneys' fee award; and then trying to recover it from somebody who probably can't pay it to them in the first place. In the example you gave me, I don't know what the finances of this lady might be but chances are, she's not going to be able to pay a six figure attorney fee award.

DP: I have to figure that one out because I am for "loser pays." I could just tell you that you are a good example of the best in lawyering. It's been an honor to deal with you and TroyGould.