Tuesday, May 30, 2023

Toolbox Talk Series Recap – Expert Conferencing ("Hot Tubbing") in Construction Disputes

In the May 25, 2023 edition of Division 1’s Toolbox Talk Series, Marcus Quintanilla, Dr. Joe Rakow, and Michael Martin had a lively discussion about strategy for expert conferencing. Expert conferencing (often referred to as “hot tubbing”) is a format for experts to present evidence simultaneously and in each other’s presence to the arbitrators or judges, who often question the experts and facilitate discussion between them.

Quintanilla emphasized that the first consideration upon learning that a trial or arbitration will utilize expert conferencing is selecting the right expert. Flexible experts able to take a more holistic view of the case and embrace advocacy tend to perform best. On the other end of the spectrum, experts with an overly combative demeanor tend to be less effective.

Another key piece of advice was to provide the expert witness the necessary background to offer compelling evidence and be flexible. Martin and Rakow both stressed that the expert needs to understand not only the expert reports, but also how they fit into the entire strategy of the litigation team. Without an attorney directing traffic via questioning, experts need to have their own roadmap. Quintanilla suggested involving the experts in the preparation of the opening statement/presentation to assure there is collaboration in crafting the narrative and detailing what evidence will be put forward. This involvement also provides experts with an opportunity to highlight issues of concern and correct any technical misstatements. A united plan on how to address areas where the expert opinion has less support or is prone to counterarguments is vital. Martin prefers to “play defense by playing offense first” and address those sticking points preemptively.

Once the hot tubbing begins, Martin and Rakow both called attention to the importance of experts establishing rapport with each other. Whether the presentation of evidence begins with a presentation from the expert (which was the strong preference of all three panelists), questioning from attorneys, or questions from arbitrators/judges, building rapport is crucial. Despite expert conferencing having the potential to be more adversarial than offering opinions through a direct examination, experts should focus on disagreeing respectfully and remembering that any dispute is a professional issue about facts and truth rather than a personal attack. Even if minor, experts should try to find some area of agreement to use as a building block. The most effective hot tubbing of experts eventually evolves into a conversation between experts.

Finally, Quintanilla advised that all parties involved, and attorneys in particular, need to relax and allow the process to play out, embracing that it is inherently a flexible method of presenting expert opinions that will vary from proceeding to proceeding. Generally, he finds that the process makes experts more credible to judges/arbitrators and their opinions more impactful.

Thank you to Marcus, Joe, and Michael for the insightful commentary on hot tubbing experts. 

Click here to view the discussion in its entirety.  


Author Douglas J. Mackin is a construction attorney with Cozen O’Connor in Boston, Massachusetts. Douglas counsels owners, developers, contractors, and subcontractors in all phases of a construction project, from contract negotiation through to completion, including disputes, litigation and arbitration. Douglas can be contacted at dmackin@cozen.com.

Tuesday, May 23, 2023

Meet the Forum's In-House Counsel: ERIN CANNON-WELLS

Company: Keller North America, Inc.

Email: ecannon@keller-na.com 

Website: https://www.keller-na.com/

Under Grad: University of Delaware (Bachelor of Civil Engineering 2000)

Grad School: The University of Texas (Master of Civil Engineering 2002)

Law School: Howard University (JD 2008)

States Where Company Operates/Does Business: Throughout the US and Canada


Q: Describe your background and the path you took to becoming in-house counsel.

A: I studied civil engineering in undergrad and finally found my "calling" when I took a construction course, prompting me to pursue a master's in construction engineering. I started my career at Turner, holding various engineering positions, the last of which introduced me to the "contracting" side of construction. I was inspired to go to law school (in hopes of becoming an in-house lawyer there). After law school, I joined BigLaw, but maintained my desire to practice construction law. I then jumped to a small construction practice group at a mid-size firm, and the mentoring and experience there was everything I could hope for (but for the looming business development and billable hour requirements). From there, I became the sole in-house counsel for a large cement manufacturer and was a true construction generalist. Now I am part of a great legal team for a leading geotechnical specialty contractor. My moves were strategic, and I'm pleased to say that this is the very career I went to law school to have. 

Q: Describe your experience in the construction industry. 

A: I've been a construction lawyer for 11 of the 15 years that I've been practicing. Within the first few months of officially becoming a construction lawyer, I was taking depositions, dealing directly with clients, performing witness interviews, documenting faulty construction work, interacting with clients and drafting discovery. (NOTE: This was a welcome challenge after spending so much time reviewing documents, drafting memos, etc. in general litigation in hopes of getting assigned to a construction matter at my prior firm). After a year or so in, I was an integral part of the trial team on a complex construction dispute. During the six-week trial, I had the opportunity to argue pre-trial motions and present and cross-examine a few expert witnesses. Unfortunately, and fortunately, that was the one and only trial that I litigated. As is typical in the industry, most matters I've been involved in since then (both as outside and in-house counsel) have settled prior to litigation. 

Q: How does working in house compare or differ from firm life?

A: As in-house counsel I like to believe that I have more control over my practice and my workday. Of course, there are always fires to put out and matters that pop up unexpectedly that shift my priorities, but the pressures of meeting billable hour requirements, building a book of business, creating flawless work product by someone else's deadline, and tracking my time are off the table. I've found that, as in-house counsel without the requirement of tracking how much time I spend on each client/matter, I'm able to be more productive and efficient with my time.  Also, as in-house counsel, I am dealing with a different type of client but also a client that I know extremely well. There is a distinct difference from having a client who is also an attorney (who knows what you know or what you should know and has a clear understanding of what you do or should be doing) versus having a client who may be skeptical or suspicious of attorneys, doesn't speak the same "language," is wired not to want to take your advice, or worse, thinks lawyers are accurately depicted on TV. 

Q: How and when do you use outside counsel? In what kinds of matters? 

A: My company does not have a hard and fast rule about when to engage outside counsel, but my use of outside counsel is a function of what's currently on my plate, what is at stake, the project's geographic location, and the dispute resolution procedure. I typically look to outside counsel when: (i) I'm not as familiar with the local rules or it's not feasible to travel to that particular jurisdiction, (ii) a collection can't be resolved by my initial demand letter, and I need to pursue lien/bond rights, (iii) the task is discreet but potentially time consuming (i.e., reply to third party subpoena, prep a witness, research state law, review documents, defend or take a deposition, etc.), (iv) the dispute could not be settled via position letters, direct negotiations, or mediation and will require reinforcements, (v) we are playing offense and defense on a dispute that is complex or substantial in value, or (vi) the other side(s) already engaged outside counsel. 

Q: What do you or your company take into consideration when vetting and/or selecting outside counsel?

A: When someone in the legal department needs outside counsel, it is likely that they are under a time crunch and don't have the time to vet someone with who the department doesn't have prior experience. That typically makes me the go-to person for recommending new outside counsel to engage--meaning I pull out my handy-dandy ABA Construction Forum Membership List, find the geographic area, and start scanning for familiar names. Surprisingly (or not), my reference to that outside counsel as being a Forum member is usually enough for them to be short-listed or cold-called for the matter. Of course, when the storm is brewing, and not already at our front door, we have time to dig a little deeper and take into consideration experience with the matters in dispute, understanding of Keller's specialties, commitment to diversity, references, billing rates, and whether a retainer is required. 

Q: What is your biggest pet peeve about working with outside counsel?

A: When I started my career in BigLaw, mistakes in any written document, no matter how minor, were inexcusable.  So, I was really surprised by some of the work product I received from outside counsel after going in-house. Of course, as the client, my standard is definitely not perfection, but one of my biggest pet peeves is having to substantially edit outside counsel’s drafts.  Whether it’s a complaint, answer, motion, or discovery, my review should be to confirm that what I know to be true is accurately captured.  There’s nothing worse (though I’m sure there is) than having to correct my company’s legal name, state of incorporation, or other facts that outside counsel should know about their client.  Also, catching errors in spelling, grammar, cites or incomplete thoughts is a red flag that then raises the question of how much oversight they will need as the matter proceeds and what their in-court presence is like.

Q: What are some of the big challenges you are tackling right now?

A: As my company continues to grow, there is an increased need to enter into downstream agreements with material suppliers, certain service professionals, and other vendors to do some of the more specialized aspects of our work.  The teams I support have been vocal about wanting standardized agreements that they can issue in those situations.  Creating those agreements, however, has been challenging.  Standardizing downstream contracts with our suppliers/vendors requires that I draft language that adequately passes down the risk from our upstream contracts, takes into consideration state-specific requirements, include required flowdown language, yet word these terms and conditions in a way that is not so onerous that it damages the relationships that the project teams have cultivated over the years.  Otherwise, we end up with an agreement that our team isn’t willing to send over, and the vendor isn’t willing to sign.

Q: What are some of your interests or hobbies?

A: Ever since my (now) two-year old entered the picture, my spare time is spent refereeing matches between him and his "fur-brother," reading children's books, playing with trucks, and managing "big emotions," but, my interests and hobbies include travelling, watching movies, and attending sporting events. Travelling may be my first love, especially to a warm climate with a beach. My destination of choice these days is our vacation home in Puerto Rico during the winter months. Pre-COVID (and pre-toddler), my husband and I had the unlimited movie pass at a local theater that we'd use weekly. More recently, it's mostly Netflix, Hallmark and Disney+ movies for me. I don't much have any favorite teams anymore, but I typically root for the underdog and/or the home team. Go Ravens! Go Orioles! Go Terps!

 My legal team at the jobsite.

 My son and dog. 


Assistant Editor-in-Chief Jessica Knox is an Associate in the Minneapolis office at Stinson LLP. She represents owners, general contractors, and subcontractors in litigation disputes. Jessica can be contacted at jessica.knox@stinson.com. 

Tuesday, May 16, 2023

Construction-Industry Clients Need Well-Reasoned and Clear Policies on Recording Zoom and Teams Meetings

The use of Zoom, Microsoft Teams, and similar communication platforms has become increasingly common in the construction industry. While these platforms can greatly facilitate communication between project participants, they potentially create a source of ESI – electronically stored information – that must be understood and considered by the businesses using those systems.

Businesses using Zoom, Microsoft Teams, and similar platforms should have policies in place to address whether and why to record video conferences, how long to preserve any recorded meetings, and retention policies for instant messaging systems. The failure to adopt appropriate policies could prove quite costly in any future litigation or criminal investigation. 

Federal Rule of Civil Procedure 37(e) sets out the duty to preserve ESI and provides significant penalties for failing to do so once litigation is anticipated. It is important to note: there is generally no obligation to create ESI, such as recording Zoom or Teams meetings. At the same time, if the ESI is created but litigation is not anticipated, businesses are generally free to establish their own retention policy for that ESI. However, once litigation is anticipated, potential litigants have the obligation to preserve the ESI and, in connection therewith, to conduct a reasonable search for relevant information (to ensure its proper preservation).

Google was recently sanctioned by a federal court in In re Google Play Store Antitrust Litig., 21-MD-02981-JD, 2023 WL 2673109 (N.D. Cal. Mar. 28, 2023) for inadequately preserving communications that were exchanged internally on its Google Chat instant message system. The court in its analysis noted:

There is no doubt that Google was perfectly free to set up an internal IM service with any retention period of its choosing. . . . What matters is how Google responded after the lawsuits were filed, and whether it honored the evidence preservation duties . . . .

The court held that Google violated its obligations under Rule 37(e) because Google had a policy that Chats were automatically deleted after 24 hours. However, Google did not suspend the auto-delete feature after the litigation started, but, rather, Google – impermissibly – left it up to employees to decide what Chats to preserve.

In addition to the obligation to preserve ESI, parties in litigation have the obligation to timely review and produce that information to respond to discovery. A special master in a patent infringement case in the Northern District of Illinois recently stated in a report to the district court that he was “unsettled” by a party’s eighteen-month delay in producing responsive Teams messages. The special master went on to express concern that the delay suggested the responding party may have “overlooked, ignored or withheld responsive Teams messages in discovery” and recommended further inquiry into the responding party’s conduct. Deal Genius, LLC v. O2COOL, LLC, 21 C 2046, 2023 WL 2299977, at *1 (N.D. Ill. Feb. 17, 2023), report and recommendation adopted, 1:21-CV-02046, 2023 WL 2299976 (N.D. Ill. Feb. 23, 2023).

The problems with identifying and preserving, and potentially producing, relevant ESI are significant with recorded Zoom and Teams Meetings. Those recordings present unique hurdles of how to review potentially countless hours of recorded video and audio to determine what must be preserved and ultimately produced in litigation. While AI tools can be used to produce transcripts of those video conferences, those transcripts can be imperfect. The process of reviewing those meetings could turn out to be quite expensive and time consuming, including the need for attorneys or IT consultants to conduct the reviews.

According to a recent article in US Law Week, “Pandemic Zoom, Teams Surge Offers Evidence Trove to Prosecutors,” May 2, 2023, the Department of Justice is targeting video communications – often from unsuspecting employees – in criminal investigations, and antitrust enforcers are pursuing copies of recorded meetings. By recording and saving Zoom and Teams meetings, businesses may be unwittingly preserving mountains of evidence for those types of investigations. This is potential food for thought when developing policies on recording and retaining video conferences.

Businesses in the construction industry should have a well-reasoned policy on which Zoom or Teams meetings to record and how long to save those recorded meetings. While there is generally no obligation to record Zoom or Teams meetings, and businesses are generally free to establish their own policies on recording and the retention of any recordings, once litigation is anticipated or started, litigants have the obligation to preserve the recordings of those meetings and to conduct a reasonable search to ensure their proper preservation. And, if those recordings are requested in discovery, a party has the obligation to timely review and produce the relevant recordings.

There is no doubt that recording project meetings can sometimes provide support or defenses in any disputes that arise on a project. However, recording and saving every Zoom or Teams Meeting – without any thought-out protocol – could prove costly and overwhelming in terms of volume of information to review, preserve and produce in any subsequent litigation.

____________________________________

Author and Editor Stu Richeson is an attorney in the litigation section of the New Orleans office of Phelps, primarily focusing on commercial litigation with an emphasis on construction matters, intellectual property issues and insurance.

Tuesday, May 9, 2023

Meet D1's Neutrals Series: KENNETH FLOREY

Company: Robbins Schwartz

Office Location: Chicago, IL

Email: kflorey@robbins-schwartz.com

Website: https://www.rsnlt.com/attorneys/kenneth-m-florey/

Law School: DePaul University (JD 1992)

Types of ADR services offered: Mediation, Arbitration, Project Neutral

Affiliated ADR organizations: AAA Panel of Arbitrators and Mediators

Geographic area served: Nationwide


Q: Describe the path you took to becoming an ADR neutral.

A: I’ve been involved in construction litigation my entire career as an attorney, going on 30 years.  After being an advocate for all sides to these disputes (owners, contractors, and design professionals), I recognize the immense value of ADR to clients and decided to start shifting my litigation experience and skills to the neutral realm as an arbitrator and mediator.

Q: Mediators are oftentimes described as “facilitative,” “evaluative,” or “transformative.” Do you have a style?

A: My mediation style is a blend of facilitative and evaluative depending on the parties’ preferences and the flow of the mediation.  I usually start in the facilitative mode and, if the parties are unable to reach a settlement, shift to an evaluative mode until we reach a settlement during or, if needed, after the mediation session is over.

Q: What should attorneys and their clients take into consideration when selecting a mediator?

A: It is critical to select a mediator based on: (1) their experience in the specific litigation subject matter, particularly with construction litigation and (2) the parties’ preferred mediator’s style.

Q: Do you have any practices that you find make you particularly effective as a mediator?

A: My most effective practice as a mediator is communicating with the parties both before the mediation and after,  if a settlement is not reached during the mediation session.  If the parties agree, after an unsuccessful mediation session, I will continue working towards a resolution, with calls, emails and texts, until the parties reach a settlement.

Q: When do you recommend parties in a dispute attempt mediation?

A: This is the most common question I receive and is routinely included in my presentations.  The answer is that it depends upon the unique circumstances of each dispute.  In my experience, the most effective mediation occurs when the parties are at the summary judgment phase.  However, depending on the complexity of the case, the contract requirements and the clients’ resources and goals, mediating earlier can also often lead to a successful resolution.

Q: Are virtual mediations as effective as in-person mediations? What are their advantages/limitations?

A: Prior to COVID, I would have said, no, you need to be in person, but many mediations are still remote with many times parties, their attorneys and the mediator participating from the comfort of their respective offices, often across the country.

Q: What are some of your interests or hobbies?

A: Outside of my legal career and family life with our four children, I enjoy reading, community involvement, and doing in triathlons.


Editor Marissa L. Downs is a construction attorney in Chicago, Illinois where she has been practicing law since 2009. Marissa is a partner at Laurie & Brennan, LLP and represents owners, general contractors, and subcontractors in all phases of project procurement, claim administration, litigation, and arbitration/trial. Marissa can be contacted at mdowns@lauriebrennan.com.

Tuesday, May 2, 2023

Toolbox Talk Series Recap – Considerations for Optimizing Dispute Resolution Clauses

In the April 27, 2023 edition of Division 1's Toolbox Talk Series moderated by Manuel del Valle, Sergio Andre Laclau (Partner at Mello Torres) and Liza Akins (Senior Assistant GC and Division Counsel at ARCO Design/Build) offered the following strategies for drafting effective ADR clauses in construction contracts:

1.     Define the ADR process for various types of disputes.

Not all disputes on a construction project are the same, and the parties can tailor the ADR process to different situations. For example, the parties could choose to arbitrate complex disputes and resolve minor claims through mediation. Differentiating the ADR process between complex and minor disputes can save parties time and money.

While Liza  prefers arbitration for complex claims because you can get a quick and final decision from an arbitrator experienced with construction disputes, she noted that arbitration costs can add up quickly. Therefore, if the dollar amount in dispute is relatively small, arbitration may not make sense financially. Mediation tends to be a comparatively cheaper and faster option.

For more minor disputes, Liza prefers a mediation-arbitration route. First, mediation is attempted and if the dispute does not resolve at mediation, the mediator later becomes the arbitrator, and the mediation essentially turns into a “baseball arbitration.” Liza said that sometimes they get a decision in their favor, and other times they do not, but at the end of the day, they are satisfied with receiving a quick resolution without having to spend significant legal fees. Manuel described this as the “pride versus financial reality” dilemma on construction projects.

2.     Consider the number of arbitrators.

Another critical aspect of defining the ADR process in a construction contract is specifying the number of arbitrators involved. This decision, again, should be based on the complexity of the dispute.

Although a single arbitrator costs less than a panel of three; however, they control the sole fate of the outcome. A panel of three arbitrators conversely provides security against a single rogue arbitrator rendering an unfavorable decision. Liza favors choosing the number of arbitrators on a case-by-case basis to find the line between not paying multiple arbitrators versus getting stuck with one arbitrator that may not agree with you.

3.     Carefully choose the right ADR Venue.

Sergio emphasizes that selecting the venue for resolving the dispute is crucial and advised that this decision should be based on the venue's laws and whether the parties have proper counsel in the venue. Sergio cautions not to pick a venue based solely on travel convenience, because the difficulties associated with navigating a jurisdiction that is not arbitration friendly often vastly outweigh savings on airline fees.

4.     Keep ADR provisions consistent when there are multiple related contracts.

Sergio recommends keeping ADR provisions consistent throughout multiple contracts to a related transaction to ensure that the process is fair and effective in resolving disputes. This can also help prevent confusion and miscommunication between parties involved in multiple contracts. From a practical point, Sergio prefers spelling out the entire ADR provision in each contract, using the same provisions and the exact language rather than incorporating an ADR provision by reference into multiple contracts.

Thank you to Manuel, Sergio, and Liza for providing this insight to ensure that the ADR process is effective and efficient.

Click here to view the discussion in its entirety.  


Author Michael Filbin is an associate attorney with Cozen O’Connor in Boston, Massachusetts. Michael is a part of Cozen O’Connor’s Construction group and represents owners, developers, contractors, and subcontractors in construction-related disputes. Michael can be contacted at mfilbin@cozen.com.

Editor Douglas J. Mackin is a construction attorney with Cozen O’Connor in Boston, Massachusetts. Douglas counsels owners, developers, contractors, and subcontractors in all phases of a construction project, from contract negotiation through to completion, including disputes, litigation and arbitration. Douglas can be contacted at dmackin@cozen.com.