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Private trials: Avoiding the costs and delays of the courts

The Seventh Amendment to the United States Constitution reads, “In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved.” But the practical reality is that many lawyers will not even consider litigating a case unless the value is tens of thousands, if not a hundred thousand dollars. They just can’t afford it.

All litigants, whether they are on the plaintiffs’ or defense side, have been squeezed by the exponential complexity of litigation and the accompanying time and expense of discovery and trial. State budget crises have compounded these challenges by drastically cutting court operating budgets. In 2009, California’s court budgets were slashed $676 million, with the expectation of laying off 1,800 court employees and closing 180 courts. They expect another $150 million in cuts. According to Mary McQueen, Director of the National Center for State Courts, Florida expects a court shortfall of $100 million this year, and in New York, budget cutbacks have led to hundreds of layoffs of court employees. In all, 43 states have experienced cuts to their operating budgets, severely hampering and slowing the administration of civil trials.

Alternative approaches

But while this strain on the courts surely causes some parties to settle cases rather than deal with prolonged trial dates, there will always be a place for parties to have their matters resolved by a representative cross-section of the community.

For example, there is now an expedited trial process in California and a short trial process in Nevada, although these are typically used for smaller matters since they are limited in time, number of jurors, and appellate remedies. There are also measures for curtailing burdensome discovery, such as those implemented in Oregon that eliminate expert discovery.

Some additional but seldom used remedies are available for those parties who do not want to wait for the courts. There is a trial reference process in California, Nevada and Florida where the parties can apply to be referred to a private judge. These judges can arbitrate the case to a final resolution, but they can also choose to empanel a private jury to hear the case.

How does this work? Counsel agree on a retired judge or “neutral” to act as the reference judge in the case. They then either agree to a final resolution by the private jury’s verdict, or to maintain their appellate rights through the public trial court. The chosen private judge decides on all pre-trial matters, including discovery disputes and pre-trial motions. The parties then agree to empanel a jury in the venue where the case would be tried. The private judge decides on the length of the trial and scheduling of the witnesses.

All of this sounds pretty much like normal trial procedure. Why would the parties agree to this privatized system, especially where they would be paying a private judge, private jurors and other costs associated with a private trial?

First, depending on the court congestion in any individual venue, a private trial could allow the parties to resolve their matter in less time than the now estimated two to five years it takes to get to trial.

Although it is always desirable to have a witness testify live, it is also one the primary scheduling difficulties in a trial. In a private jury trial, the parties can agree to either pre-record the direct and cross-examination of an expert or to have the witness testify via Skype or a video conferencing system. Additionally, the parties can stream the private trial over the web for attorneys or clients who cannot be present.
Also by agreement, jurors can be recruited with specified professional expertise or personal experience if there are concerns that the case issues may be too complicated for an ordinary lay jury.  For example, jurors with more medical experience can be sought for a medical negligence case, engineers for a product liability case, or individuals with business experience for a contract case.

By agreement between the parties, certain evidentiary shortcuts can also be taken, including neutral tutorials to get jurors up to speed more quickly. This has already been used with great success in federal courts in the Northern District of California, which routinely give a preliminary instruction on patents to jurors to help provide context for those claims. The parties can also stipulate to evidence summaries, allowing witness narrative answers, or written summaries of testimony or evidence for the jury’s consideration.

Although it is more unusual, private jurors can also fill out carefully designed questionnaires to determine what they see as the strong, weak and confusing issues in the case at various points prior to verdict, such as after opening statement, selected witnesses or closing arguments. Based on this interim feedback, parties could either adjust their presentations or resolve the case. With the agreement of the private judge, the parties can also agree to other procedures to minimize the risks of a public jury trial, such as a high-low agreement between the parties.

When looking at the relative costs of a private vs. a public jury trial, it may initially appear as if a private trial would be more expensive. But if the parties are paying attorneys and experts, the cost savings in conducting a private trial can be significant.

Think of a public trial these days. Many courts only get four hours of trial time in a day and some only conduct trials three or four days a week. This means that if each side has twenty hours of trial time, they are looking at two to three weeks of trial, with the attorneys usually billing for the entire day and weekends as they prepare for the following day.

However, as a private judge does not have to hear other matters, take an hour-and-a-half lunch break or end at a certain time, a private jury can clock eight hours of trial time per day. That means 40 total hours of trial time results in only five to six days of a private jury trial. When you compare three weeks vs. six days of trial, the cost savings can be significant. And since private jurors are paid better than the paltry sums given to public jurors, they are more likely to sustain their attention in a longer trial day.

There are additional cost savings in the elimination of the delayed motions, postponed hearings and restarts that occur in a public trial as the court juggles its own scant resources.

Private jury trials are certainly not for every case and should not supplant public jury trials as one of the cornerstones of American democracy. These private trials need greater preparation and cooperation between the litigants in order to contain costs, thereby creating greater efficiency.

However, with some recent polls finding that more than three quarters of those who participate in the system are unhappy with the current model of civil justice, it is important to look for innovations to relieve our overburdened courts. Judge Judith Chirlin, Executive Director of the Western Center for Justice, has stated, “In these days of significantly reduced resources in the courts, there needs to be an alternative where parties can have their matters heard in an economical and efficient manner. Private jury trials can be one of those alternatives.”

Richard Gabriel is President of Decision Analysis, a national trial consulting company in Los Angeles. He an author of Jury Selection: Science and Strategy and the innovator of Jury Mediation, a new dispute resolution tool.