When Is Speculation Illegal “Gambling”? When is Risk-Sharing “Immoral”?

Poker Chips 300x225 When Is Speculation Illegal Gambling? When is Risk Sharing Immoral?Imagine a business model where someone bets with you on whether or not you will be physically injured over a certain period of time and, if you are seriously injured during that time, then you “win” the bet and the other bettor has to pay you up to a certain limit. If you are not injured during that time period, then the counter-party “wins” and you do not get your money back.

This, of course, is the essence of insurance. We do not think of this as gambling. We do not think of this as immoral. We do not think of this as “mere speculation in the troubles of others.”

Imagine that you have bought insurance, you are injured, your insurer foots the bill per the insurance agreement, and then the insurer sues a third-party tortfeasor to recover damages the insurer paid out for your injury. We generally do not think of this as gambling and we do not generally think of this as immoral. It’s very common. It is not a prohibited “agreement between a stranger to a lawsuit and a litigant by which the stranger pursues the litigant’s claims as consideration for receiving part of any judgment proceeds.”

Now, how about this: you are injured and you carry no insurance. (Maybe you are injured in such a way for which there is no insurance available.) And a “legal finance” company proposes to finance a lawsuit, agrees to give you money up front in exchange for a share of any recovery in a lawsuit against a third-party tortfeasor. You might call this “after-the-accident insurance” in a way, right? Or you might call it “litigation insurance.” Does this scenario somehow convert the circumstances to gambling? To something immoral? To something illegal? To something that courts and legislators should make illegal as socially harmful?

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You won the lawsuit! Now what?

Money Role 300x225 You won the lawsuit! Now what?Minnesota civil litigators spent very little time trying cases, as we all know. From that, it follows that Minnesota civil litigators, generally, spend very little time collecting on money judgments. Roughly 99% of civil lawsuits are either thrown out of court, or settled far in advance of any judgment, or, a very small percentage, settled post-judgment (for example, after summary judgment or while a case is pending appeal). Even fewer contested cases require collection efforts.

So Minnesota civil litigators generally do not spend very much time converting court judgments into cash.

(The exceptions to the rule are collections specialists like Twin Cities attorneys George Warner or John Halpern or, sometimes, particular large firm lawyers who are assigned this kind of work on behalf of the firm (like Bricker Lavik used to do for Dorsey & Whitney LLP). Lawyers like them spend a lot of time monetizing unopposed judgments against “judgment debtors” who have no defenses to creditors claims and therefore do not appear and defend the creditors’ claims. (Unfortunately for the debtors, “I don’t have the money” and “I do not want to pay you” are not normally viable defenses.))

But, for the rest of the Minnesota civil litigation bar, I thought it might be useful to dig a bit into just what this means, “Let Judgment Be Entered.” What does it entail? How long does it take? What is “docketing a judgment”? Is “docketing a judgment”a synonym of “entering a judgment” or something entirely different and distinct?

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Fighting over Minnesota’s National Treasure…

Pose lake Minnesota 1 300x224 Fighting over Minnesotas National Treasure...

The Boundary Waters Canoe Area

As I have aged, one saying that I have become fond of is, “You can never make new old friends….” Our lives are transient. Our friends and family are forever (as far as we are concerned).

For many of us, there is a similar transcendent nature to our planet’s natural resources and, in particular, to irreplaceable areas of pristine untrammeled nature. Once it is gone, it is gone.

So no one should be surprised by the level of passion that many of us feel about protecting Minnesota’s Boundary Waters Canoe Area (BWCA).

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When Can a Litigant Talk Out of Both Sides of His Mouth and When Can’t She?

Golden Chameleon 200x300 When Can a Litigant Talk Out of Both Sides of His Mouth and When Cant She?

Photo by Jeremy Johnson, Meddling with Nature

A child might say, “Daddy, you cannot prove that I ate the cookie, but, if you conclude that I did eat eat the cookie, I thought that Mommy said I could.”

This child will possibly get a time-out from the parents. Maybe not. Either way, the parents might be forced to suppress smirks at the child’s precocity, audacity, and cleverness. But how do we feel about it when grown-ups use such double-talking tactics in our courts?

Judicial estoppel prevents a party that has taken one position in litigating a particular set of facts from later reversing its position when it is to its advantage to do so. It is intended to protect the courts from being manipulated by chameleonic litigants who seek to prevail, twice, on opposite theories.

This seems pretty obvious, right?

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Does Your Livelihood Have Any Meaning or Redeeming Social Value?

Soo Line 2500 Streamliner 300x225 Does Your Livelihood Have Any Meaning or Redeeming Social Value?

Photo by Keon McGarvey

Update (September 15, 2014): I hope the “subject line” is an exception to Betteridge’s law. We all have to be our own judges on that.

The lawsuit, discussed below in April, 2013, celebrated its second birthday in early May of this year.

This past week Sr. U.S. District Court Judge David S. Doty (D. Minn.) denied Defendant Werner’s motion to bifurcate trial (that is, to split the trial into two trials – first one as to liability and then one as to damages). I get it. I get why Defendant Werner wanted to have the trial in two different phases. And I get why both the Court and Plaintiff Soo Line felt differently about it.

But the question that I would like answered is, “What is so complicated and difficult factually or legally than can justify legal bills clearly in the hundreds of thousands of dollars for this fairly straightforward case?” The history of the lawsuit is a bunch of motions by both sides that have been denied for the most part. In other words, to date, this lawsuit has accomplished barely anything for the litigants but I am sure it has cost them dearly.

Mind you, it would appear that the lawyers on both sides of this case have raised some valid points over the past few years and argued them well (and at length). The question remains, however: is it worth it?

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