OTLA Trial Lawyer Fall 2021

40 Trial Lawyer • Fall 2021 Cooking with Force Continued from p 39 with names and old addresses. Second, we had a good liability case. Third, the stakes were high, as most former students had spent 20-40 thousand dollars, and the vast majority were straddled with lifetime debts from high-interest loans. Finally, we knew we could use the arbitra- tion rules (AAA consumer arbitration) to our advantage. We realized if we could sign up enough individual arbitrations, we could make defendants rue the day they failed to settle with all students. Fighting back: developing asymmetry Based on our assessment, we believed we could sign up a mass of arbitrations. We projected if we signed up at least 100 clients for individual arbitrations, we would likely come out well enough. We were able to sign up over three times that number. We expanded our team to add lawyers to handle mass arbitrations. 4 We retained a vendor to provide automated sign-up and case management. 5 That proved es- sential to managing the mass of cases. The arbitration team intentionally staggered our filings to keep the defense team guessing. We took to filing 25 new cases each Friday (“filing Friday”), and the defense would periodically ask us how many more we had. “Not sure,” we would say, which was wholly truthful. The final tally was some 330 individual cases. While they did not acknowledge the problem, the defendants were in a diffi- cult situation. Under AAA consumer arbitration rules, the consumer seeking arbitration must pay the filing fee—here $200— and the defendant must pay the remainder of the fees, including a hefty case administration fee, hearing fees and arbitrator fees. The aggregate case admin- istration and first appearance fees for 330 arbitrations amounted to a low seven- figure total. That amount did not include arbitration hearing fees, arbitrator fees, attorneys’ fees for their legal team and attorneys’ fees for ours if we prevailed. Not to mention the aggregate damages risk, which we calculated to be some- where in the high seven-figure range. When faced with the mass of over 300 arbitrations, the defendant proposed a series of measures to manage the mass. The parties agreed to arbitrate bellweth- ers and then go to mediation. The planned process was adjusted several times over. But in essence, the parties tried five cases to five different arbitrators and then — based on the mixed results — went to a second mediation. A few bugs in the system There were unanticipated problems that made this a heavier lift than we anticipated. First, as happens so often in long-running cases, a change in the law unrelated to our case had a profound impact. The Trump Tax Act of 2017 eliminated all sorts of personal and busi- ness deductions. According to tax advice we received, this meant consumers who