The cost-benefit approach to litigation management is based on the principle that a civil lawsuit is best viewed as a commercial transaction. Anyone who receives a benefit or carries a risk from the lawsuit is a party to the transaction. Accordingly, the economic benefits and risk of each party must be considered in each management decision. The parties to the transaction are not just the litigants. Beneficiaries of litigation may include each involved attorney, expert consultants, as well as even mediators and special masters. The benefit and risk to each of these parties is a management consideration at each point in the litigation.

In most lawsuits neither insurers or plaintiffs receive benefit from protracted litigation. Those being paid on a time basis usually do benefit.

Recommendations for work prior to settlement negotiations should be viewed as to whether they are truly necessary for the settlement process. While the obtaining of elaborated information and opinions may be necessary for trial, less detailed information and opinion is required for settlement.

Here are items to watch on billings of attorneys and experts:

• Excessive reviewing of files and documents.
• Intra-office conferencing.
• Minimum time assignments that exceed a tenth of an hour.
• Assigning the minimum time to work requiring less than a minute.
• Excessive time in communications between attorney and experts.
• Paralegals or law clerks who are doing clerical work.
• Excessive charges for photocopies, faxes or travel related expenses.