Hi E@N!
Hope you enjoyed today’s talk.
I think our discussion topic for this week is pretty clear, given the talk. I want to know what you think about these settlement-mills!
On the one hand, they aren’t at all honest about their practices, and it might even be the case that they conspire with insurance companies. So they are bound to leave some claimants with far less money than they deserve. On the other hand, they are cheap, quick, and accessible. They might be the very sort of quick remedy that the poorer population (especially with small claims) are looking for.
I’m personally genuinely conflicted about these firms. They are unprofessional, and as I said in class, their lack of transparency is certainly worrisome. But they do seem to be doing good. Without them, many people would sustain harm without any remedy.
Looking forward to hearing from you!
Phrase of the day for me was “rule violations galore.”
I was surprised that blatant illegal behavior exists in the profession of law. What sad irony.
Did anyone else leave the room convinced insurance companies are in some shady way an equal partner in the scheme that are settlement mills? I am inclined to believe some sort of agreement has been reached, spoken or unspoken. Ethical violations galore.
I was bothered most by the thought that, potentially, a plaintiff seeking counsel from a settlement mill may never have their case make it onto the desk of a lawyer; moreover the defendant’s representation may also not be a legal professional if an insurance claims adjuster is handling it. The legal representation of both sides of the potential “lawsuit” (which I put in quotations to emphasize the fact that no apparent trial is looming) … are not lawyers?
I don’t understand what the Model Rules that Professor Freeman Engstrom displayed are supposed to signify. Are these codes not a legally binding? I do not know, so I hope someone can tell me, what is different about ‘Model Rule” to a lawyer than, say, the Hippocratic oath to a doctor? The Hippocratic oath makes a doctor liable to legal prosecution… Are lawyers and firms liable to malpractice suits?
I was intrigued by the idea that somehow the ethical rules of the legal profession should be modified to allow settlement mills. It does seem like the settlement mills are doing some good in getting small claims for people who probably would never receive that money without the efficiency and affordability of settlement mills. The idea of fraudulent claims does not bother me too much in this instance, because it seems that the insurance companies are tacitly agreeing to the gig. They have made a choice that it is cheaper to give the little claims their money, regardless if they pay a few people they shouldn’t, in order to save them money from real lawyer fees and trials.
I was curious about what the implications were for finding a way to make settlement mills legal and transparent. Are small personal injury claims an isolated case where it is easier for all sides if the process is streamlined outside of the courts, or are there other types of law that might be more efficiently handled by non-lawyers? What would a rule that allowed this be written like, and what sort of precedent would that set? If it was legalized and made transparent, I wonder if settlement mills would become too prone to abuse, and therefore lose the benefit they provide. It might become unprofitable for insurance companies to deal with settlement mills as they have, and the streamlining of the process would be lost. Maybe settlement mills operate best just as they are, in the shadows of legality.
I did wonder why more settlement mills weren’t caught. While I understand that there are none of the traditional whistleblowers of malpractice, but it seems that settlement mills would be relatively easy to spot. If the legal system was serious about self regulating, you would think that they would investigate anybody who advertised on TV about getting people money, and that if they demanded the paperwork it would be easy to prove that the settlement mill was doing something illegal. Why is it so uncommon that they get caught?
As Professor Engstrom’s presentation progressed, I started to wonder how these people are even considered to be lawyers or why someone would need a law degree to perform this service. Given how they very rarely go to trial and often delegate the settlement cases to non-lawyers anyway, it seems like this could be an entirely different kind of business—one that employs people for positions such as “personal injury settlement expert” or something like that, without being associated with actual lawyers. The transparency issue is definitely something to look at here, because in my view, what these settlement mills are doing is deceiving the public, and in my personal ethics, deception in this major form is not permissible. People expect that their cases are going to be handled by lawyers and given proper thought and consideration, when this is obviously not the case. Apart from deception, their delegation practices are certainly legally questionable.
On the other hand, because of the demographic that these firms serve, their advertising does help a lot of people who would otherwise not have realized that they could take legal action. I still do not think that this is something that cancels out the deception and potential illegality of what they are doing, however. I, too, am surprised that more of these firms are not being caught or shut down.
I am curious about how these settlement mill lawyers feel about themselves and their work. Do they think that what they are doing is ethically acceptable? How do they rationalize their behavior? Professor Engstrom mentioned that one person she interviewed said that All-State was a pain—does this mean that they see themselves in a positive light and view insurance companies that don’t agree with what they are doing as being wrong?
The ethical implications of for-profit lawyering akin to “assembly line” work, while interesting, are not to me the most striking features of the talk. What’s more compelling is the fact that the quality of lawyer one receives to defend him is completely a function of his income or wealth. While the profit motive may be effective way to get lawyers to try their hardest to defend clients, it may lead to inequities in conviction and incarceration rates between the poorest and richest people.
While it would not be surprising to find that the poor do commit more crimes on average (due to obvious reasons like desperation), true justice would seem to require about equal conviction rates per charge filed for the rich and the poor. The well-off are able to afford lawyers with more experience and less of a workload who can really focus on their case.
While I am aware of the insolubility of the more money = more privileges problem, I don’t think it hurts to point out that the poor are getting the worst of both worlds; their position makes them more likely to commit crimes in the first place, and they get the worst (or most overworked) defense attorneys.
While I don’t have any empirical evidence to back up my claim that rich people are advantaged in the criminal justice system, the fact that almost all inmates are low-income or no-income does seem to be in line with it. My prediction is that man-hours per client for lawyers defending low income people are much lower than that of the rich and famous.
Maybe it’s just wishful thinking to hope for more equal legal representation. I suppose the same can be said for nearly everything – the rich have better education, diets, medicine, and even lawyers. What a shame.
Is there a regulatory body that watches over the conduct of lawyers? Such an entity seems especially important after our discussion on settlement mills. Without such an entity, it will be very difficult for individuals like Ms. Engstrom to expose organizations and their employees for their violation of so many lawyering ethics. The interesting issue here is of course, whether the moral rules that Engstrom presented also have any legal grounding that would result in the punishment of bad practices. If this is an issue of formality and justice, that is, if the laws do not necessarily punish unethical behavior (but still lawful), then there is really no way to stop these settling mills from continuing their businesses, and that’s what they are, businesses. There’s also no way to force them to change their practices, assuming they would if they had to.
That said, I do not see settlement mills as completely bad or without purpose. One possibility is to reform these settlement mills so that they continue to serve their populations but do so with more transparency and concern to ethical behavior. The issue comes back to this: who will enforce this reform? Who will keep an eye on and punish these organizations if and when they violate these rules? It will be difficult to individuals to do this. More than likely it will have to be a government organization who steps in to regulate. And since many of these organizations are already nationwide, it may well have to be the responsibility of the federal government to regulate these organizations.
My only disappointment about the presentation was that Engstrom did not present any concrete alternatives to settlement mills besides possible reform. If “poor people” go to settlement mills then where do “rich people” go? Indeed, what is anybody supposed to do instead?
While I agree of the good that Prof. Engstrom highlighted from the practice of the settlement mills, for example, the law education which the socio-economically less privileged wouldn’t have gotten if not for the exaggerated commercials and the compensation they wouldn’t have considered getting, I do not in principle support their practice. Their existence and continual fueling given market demands will not be beneficial to the poor in the long term, unless some critical condition of mass knowledge of their legal rights amongst the poor is reached – and the system is hence restructured in ways such that these unethical practices are abolished.
I am concerned for the implicit understanding of the transaction and how that will corrupt the society if not corrected. In the practice of the settlement mills in which all parties involved (the claimant, the firm, the insurance company) are “happy” because a good compromise point is reached, what is implicit is that efficiency is more valued than justice and/or facts. I think this hidden (or not so hidden) assumption is detrimental to the profession’s credibility and integrity. This reminds me of Prof. Marshall’s talk at the beginning of the quarter in which he shared how he spent 4000 hours on one particular case. He was not in it for the money, but for justice.
The option of setting up a company that’s explicitly commercial and presents the customers clearly their roles in the claim adjustment process was suggested during the talk. While it is a viable solution and would be rid of most of the ethical malpractices of the settlement mills, I think it fundamentally challenged the public and the legal profession’s understanding of the legal system. When party A violates the rights of party B protected by law, how do we make sense of it if it were to be mediated by a company that do not have professionally trained lawyers?
This issue of settlement mills was quite interesting. I never really thought much about them. I could recall switching the channel when one of those annoying lawyers came on the television and thinking that they are just trying to scam people. But maybe they are trying to do some good, to help some people. They are very efficient and effective in getting people quick cash settlements. They do good for the poor. For people who experience an accident or something and need money quick to settle medical bills. These people cannot afford to get drawn out with lawyers who pay way above the individuals weekly paycheck. There isn’t much lost when dealing with lawyers from settlement mills. They do give people a chance who did not think they had a chance with receiving settlements.
However, while these settlement mills posses some good, does it make how they are doing it right. That they are deceiving the public. That they are rolling through claims like they are meaningless pieces of paper.
What also struck me was the talk about how settlement mills have a type of deal with insurance companies. That insurance companies will grant the a larger settlement to the small claims but smaller settlements to the larger claims. And the settlement mill lawyers are not to push for the most they can get with the larger settlements. I was not sure how to respond to this. There are many more smaller claims that go through the hands of settlement mills, while larger settlements are more rare. Should lawyers spend more time on smaller claims, taking away time from other claims where other people need to receive money. I am not quite sure where my position on this stands.
When I was little, those lawyer advertisements would play in between the television shows that I would watch. Back then I didn’t consider them real lawyers, just like I didn’t consider TV judges real judges. Yet they are and finally after years of never even researching exactly what those lawyers on TV were actually doing, I learn the label: settlement mill practice.
As Albert points out, there is good and bad to these kinds of firms. The conflict arises though in the image surrounding this practice. Law is supposed to be this high ideal; the profession is supposed to have a certain code of ethics and standards. It is easy to label these firms as “unprofessional” because they go against what is deemed professionally acceptable. People have to receive a license to practice law and with that license comes responsibility and consequence if those responsibilities are breached. This socialization makes it hard to accept that settlement mill practice exists where the business comes before the law.
Many students brought up the issue of transparency. The average citizen may not be able to put a name on this kind of law firm or explain exactly what they do and how they do their job. Just like there are subjects in school covering citizenship and economics, there should also be subjects covering settlement mill practice in layman’s terms. If schools are not enough, then there should at least be informative videos and a quick seminar at the DMV. With more knowledge, the average citizen can be more informed and that in turn could affect the ethics surrounding these firms.
What I found surprisingly alarming was the blunt creeds placed in these firms. They weren’t hiding what they were doing. They simply spelled out the economic incentives that they were after. This is a problem. To have them not even consider or fear that they are going against some code of ethics is worrisome. That might even imply that this is the norm and that this practice is acceptable. Changing this will be a challenge. A good start would be to have consequences for breaches in these code of ethics. That’s definitely possible. We can see evidence of that with scientific research and the presence of the IRB. Another step is just more education. Regular citizens need to know what is going on from a reliable source whether that is in the form of formal education or pamphlets/videos offered at local community centers.
I’m a bit surprised at the very strong negative reactions of the class in regards to settlement mill lawyers’ practices. I agree with Professor Engstrom’s belief that perhaps the moral expectations for practicing law, at least in this case, are simply not realistic in regards to how many cases are pumped through settlement mills. I’ll share two particular views of why I think this is:
Stated above, settlement mill lawyers tend to cut the amount of time and effort spent working to maximize the returns to clients from small-claims issues, so they can maintain a heavy flow of new cases coming in and out of their firms. However, is this any different than at least half of the jobs in the world, ever? All the time, people slack off in their jobs and put less effort into duties; there comes a point where it’s silly to expect perfection from a person throughout the entirety of a position, if they are being driven by profit rewards. As Vang stated above, settlement mills are, after all, just businesses — not only is it easier to take short cuts and make the same returns, it is economically smart to develop ways to save time and effort on the job. Now, I’m not making an argument that just because most businesses have their own economic interests in mind means that it’s ok for these settlement mills to do the same. I rather argue that this is not particular of this specific field of law, nor the profession of law in general.
In addition, I see no reason why the moral expectations of the practice of law should be so incredibly strict regarding the stigma of outsourcing law work to non-lawyers to complete. To me, this implies that no part of a law case shall ever be touched by anyone other than those individuals who have passed the bar exam. However, law firms often have interns and non-lawyers working within, where it is very common for cases and contracts to be worked over by those without a law certificate. Though this is slightly different than the issue at hand, since work in a law firm will (I’m assuming) ultimately be looked over by a lawyer, that doesn’t completely preclude the notion that a client’s case is being handled by a non-lawyer without the client’s knowledge.
So in the case of settlement mills, the outsourced workers are clearly competent in doing their work, and perhaps do it even better and more efficiently than a lawyer would. It seems silly to have an oath that stops trained professionals from doing this type of work they are capable of doing, and are needed to benefit a certain section of society that utilizes settlement mills.
Overall, I believe that private law firms are still private firms driven for profit, and their treatment of clients should have no greater moral expectation than any other profession with a written oath regarding how to do their duties. I DO think it’s wrong that settlement mills outsource cases to non-lawyers without the client’s knowledge, but I believe this is more a problem of the technicalities of the oath of a lawyer than anything else.
On a personal level, settlement-mills leave me with an unpleasant aftertaste. While it is quite understandable to see where these “mills” might serve the greater public good by providing cheaper and more accessible law consoling, they seem to be more over-shadowed by their shady representation of the practice of law in general. As Professor Engstrom postured at the beginning of the lecture, law is the system of rules of conduct established by the sovereign government of a society to correct wrongs, maintain the stability of political and social authority, and deliver justice. The mere idea of law infers the idea of an ethical and moral treatment of the case at hand. While law is systematically thought of as a lucrative career, law should not in itself be used as a means to do business. The sole treatment of law to reap the most benefits and rewards contradicts the idea of the wide definition of law. Businesses, the concept of administering to earn profit to increase the wealth of the owners, are easily susceptible to corruption, and the line drawn between business and law, when crossed, does not seem to benefit society in any ideal way. However, I don’t necessarily agree that the fact that plaintiffs might be negatively affected by settlement-mills by not getting their fair share of what might be a reasonable settlement. I think that if one chooses to bring their claim to a settlement mill, they should know what they are getting into. Also, there is no systematic proof that bringing the case to a more legitimized law firm would garner the person any more money. It’s the risk a person takes when traipsing through tort law. Overall, there obviously needs to be some type of reform over this sector of law or we risk the loss of justice in our legal system, as law becomes synonymous with the businesses they are seeking damages from.