1. 11/21/2005www.EPS-Consulting.com1 How to Effectively Try a Business Case to a Jury Presented to the Business Litigation Committee of the Boston Bar Association November 21, 2005 Edward P. Schwartz www.EPS-Consulting.com

2. 11/21/2005www.EPS-Consulting.com2 Advice on Trial Strategy 1.What do we know? Statistical Verdict Studies Surveys Mock Jury Experiments 2.What can we extrapolate from what we know? Related Studies Experience with Similar Cases 3.What do we need to study? Run our own survey, focus group or mock trial

3. 11/21/2005www.EPS-Consulting.com3 Information Aggregation Meter Readers (Lopes, 1986, Hogarth and Einhorn, 1992) –Algebraic –Balancing –Anchoring and Adjustment Story Tellers (Pennington and Hastie, 1991) –Narrative Construction –Seek Coherence –More prevalent

4. 11/21/2005www.EPS-Consulting.com4 Hindsight Bias Jurors tend to treat low a probability event that actually occurs as much more likely than it is. –Jurors will believe it to have been more easily anticipated and will assign greater urgency to guarding against it. –Jurors often conclude that parties to a contract should have anticipated every contingency. –Jurors tend to blame “the big guy, with all his fancy, high-priced lawyers.” A second order effect is that the more bizarre the circumstances, the more jurors tend to believe that it must have been “somebody’s fault.” One strategy for overcoming hindsight bias is to argue by analogy to something familiar to jurors.

5. 11/21/2005www.EPS-Consulting.com5 Issue Salience and Persuasion (Petty et al., 1981) Issue Saliency LowHigh Agreement with Message High Low Expert with strong argument Expert with weak argument Non-Expert with strong argument Non-Expert with weak argument

6. 11/21/2005www.EPS-Consulting.com6 Factors Affecting Jury Performance Give Instructions First. –Improves Jury Recollection of Relevant Information (Elwork, Sales, and Alfini, 1977) Defanging –Offering bad news yourself allows jurors to provide counter-arguments. –Example: The “Hired Gun” effect.

7. 11/21/2005www.EPS-Consulting.com7 Damage Calculations A variety of strategies are employed (Goodman, Greene, and Loftus, 1989) “Ad damnum” is often used as anchor for award. (Zuehl, 1982) A “counter-anchor” can affect the jury’s calculations. (Raitz, et al., 1990) Itemized verdict forms can reduce excessive damage awards. (Zuehl, 1982)

8. 11/21/2005www.EPS-Consulting.com8 Zuehl’s Ad damnum Study (1982) Ad Damnum Ever Exceeded? Awarded Exactly Average Award $10,0003 times70%$18,000 $75,000no51%$62,800 $150,000no29%$101,400 Substantial Compensation N/a $74,600

9. 11/21/2005www.EPS-Consulting.com9 Punitive Damages in Business Cases 1.Punitive Damages are most common in business cases (contract, fraud, employment) according to Eisenberg, et al. 2.The request for punitive damages tends to increase the size of the compensatory award, even if no punitive damages are awarded. 3.When conduct is egregious and punitive damages are capped or unavailable, juries react by increasing compensatory awards

10. 11/21/2005www.EPS-Consulting.com10 Do Juries Help Out Local Litigants? Punitive Awards MeanAwardsMedianAwards DefendantLocationDefendantLocation LocalRemoteLocalRemote Plaintiff Location Local49.4458.01 Plaintiff Location Local50.00 Remote37.2742.06Remote25.00 From Table 4.2 of Punitive Damages

11. 11/21/2005www.EPS-Consulting.com11 Auditory and Visual Cues of Deception Zuckerman, DePaulo and Rosenthal 1981 Do jurors infer truthfulness of testimony from verbal and visual cues? Subjects saw/heard taped testimony which varied along three dimensions: –Audible Speech. –Visible Body. –Visible Face. Some subjects only read a transcript of testimony.

12. 11/21/2005www.EPS-Consulting.com12 Auditory and Visual Cues of Deception: Results Zuckerman, DePaulo and Rosenthal 1981 Transcript Only: 0.70 Tone Only: 0.20 Entries are in Standard Deviation Units