McAlpine, PC Client Sued for $23 Million on Public Works Project; Walks Away Receiving $3.3 Million in the Settlement—We Used Creative ADR To Resolve the Case
February 2, 2021
| McAlpine, PC recently won the dismissal of one of its general contractor clients from complex multi-party construction litigation threatening to ruin the company. However, we successfully achieved a settlement that paid the client over $3.3 million and resulted in the dismissal of over $20 million in claims against it. We did it by aggressively using a customized alternative dispute resolution (ADR) process to win the settlement. Not only did the client reach its litigation objectives, but it also avoided significant legal fees and costs that would have been spent proceeding to trial. In this high-stakes litigation, our client was a general contractor who had been sued by the designer and owner of a large municipal utility construction project. The litigation’s focus was whether a significant redesign of the project was caused by contractor errors or defects in the design of the project. After completing preliminary discovery, the parties agreed to conduct a “special” case evaluation using three hand-picked evaluators to review the parties’ briefs and hear a 2-day presentation of the parties’ cases. During the hearing, the lawyers presented their respective arguments, along with expert reports, selected testimony, and relevant documents. The special case evaluation panel then issued a non-binding award on each of the many claims between the parties. Under the court rules, a party who rejected an award that was accepted by the other party could be required to pay the other party’s attorney fees if they don’t beat the award by at least 10% at trial. In this case, the panel rejected all of the claims against our client and instead awarded it over $3.3 million on its claims. Decision-makers for all of the parties attended the remote presentations. They thus were able to intelligently accept or reject the awards after having seen for themselves how the facts and law could be argued to a jury. Given the strength of the presentation of our client’s case, the opposing parties each accepted all of the awards concerning our client, even though the rest of the litigation did not settle and will likely proceed to trial. The result is that our client achieved its recovery objectives and avoided a “bet-the-company” loss of over $23 million, not to mention saving hundreds of thousands in legal fees. This case shows that when used, ADR techniques can be very successful in both achieving the client’s litigation objectives and reducing the time and cost of reaching a resolution. |
