Feature

FEATURE

David Takes Goliath

Small firm leverages technology to win $96 million suit.

By Janet Roberts

Complex, multilayered megacases with millions of documents and millions of dollars at stake, once the bastion of large law firms, now are an open market for tech-smart, smaller law firms in the wake of a $96 million win by Rose Walker in Interstate Southwest Ltd. v. Textron Lycoming.

Much like the proverbial David taking on Goliath, Hal Walker and Marty Rose, partners at the 15-lawyer Dallas firm that bears their names, used InterLegis Digital Document DNA technology in their slingshot when they faced Jones Day, a firm with more than 2,200 lawyers in 30 offices around the world. Rose Walker’s client, Interstate Southwest, a small metal forger based in Navasota, Texas, was up against Textron Lycoming, one of the biggest aerospace conglomerates in the world.

“We knew if we lost this case our client would be forced out of business,” Rose said. “They [Textron] were not only threatening to sue, but they were blaming Interstate in the press, in public and with the Federal Aviation Administration.”

Making the Case

At the heart of the matter were a number of crank shaft failures in small airplane engines that occurred during flight. Between 2000 and 2002, there were 24 failures and 12 deaths in Cessna, Piper and other airplanes with Textron Lycoming aircraft engines and Interstate crankshaft forgings. The result was a $130 million government recall and $50 to $60 million in tort claims over the deaths related to those failures, according to Rose.

Textron Lycoming claimed Interstate had improperly forged the crank shafts — an allegation Interstate denied, stating Textron had submitted an improper and inadequate crank shaft design to Interstate. “At the time of the contract renewal in 2001, Textron had six failures. Interstate would not have signed the contract if they had known about those failures,” Rose said.

Interstate’s insurance premiums increased exponentially, and Rose Walker filed suit for approximately $8.5 million in Texas’ Grimes County District Court. One month later, Textron filed a $173 million indemnity claim against Interstate in a Williamsport, Pa., court in an attempt to stop the Texas case and push the Pennsylvania case to trial first. Rose Walker succeeded in taking its case to trial first, and after almost eight weeks in a country courthouse in Anderson, Texas, the Grimes County jury found Textron Lycoming liable for fraud and ordered the company to pay more than $9.7 million in actual damages and more than $86.3 million in punitive damages to Interstate. The verdict effectively precluded Textron Lycoming from pursing the Pennsylvania indemnity claim.

Technology Levels the Playing Field

Rose Walker credits much of the win to the Internet-based digital document management service, Digital Document DNA created by Dallas-based InterLegis Inc., which Rose Walker employees began using three years ago. According to Walker, the firm had served as a beta tester for InterLegis five years earlier, and subsequently used the technology in several document-intensive cases with great success.

“We were familiar with the product and comfortable with it,” Walker said. “We knew we would have a lot of documents and blueprints having to do with the forging in this case, and InterLegis would allow us to scan documents in quickly and commence searching online in a couple of days.”

Rose Walker started by scanning its client’s documents, many of which were oversized blueprints, into the Digital Document DNA database, and then searching for privileged documents. The firm was able to produce relevant documents electronically to the defense attorneys and receive defense documents electronically in return. Interstate said the 707 model crank shaft was at issue, but according to Walker, Textron said other crank shaft models were at issue. The judge agreed, and that meant more than a million documents needed to be reviewed to prepare for trial. To compound the problem, Anderson, Texas, a tiny town of 300 people, had no Internet access and the courthouse had not been updated to provide a user-friendly environment for electronic trial presentations.

“Our [Information Technology] people wired the courthouse for sound, and InterLegis created a suitcase-sized server with the entire database loaded onto it,” Walker said. “Despite conducting a trial in a country courthouse, we were printing out documents from the database in the courtroom and handing them to the witnesses.”

Small-firm attorneys Marty Rose and Hal Walker leverage
technology to keep pace with larger firms.

Rose Walker used Visionary Legal Technologies’ trial presentation software in the courtroom, a solution the firm discovered four years ago. Rose and Walker now are investors in the company.

According to Walker, during the Interstate case, Visionary ran seamlessly with Digital Document DNA and allowed for instantaneous editing, a function Jones Day attorneys were unable to do with their trial presentation system, inData’s TrialDirector. All of Rose Walker’s witness examinations were done with the exhibit displayed on screen.

“We edited depositions and exhibits in the courtroom while the judge made rulings on what portions of depositions could be played and what could not,” Rose said. “Jones Day could not call up exhibits and do an immediate edit in this fashion.”

Digital Document DNA is run on an Internet-based platform and can be customized to many third-party technologies without losing interface with the database itself, according to Kevin Carr, chief executive officer of InterLegis. Carr said InterLegis can be custom configured to be installed onto a firm’s network, and provides small firms without the resources to handle complex, document intensive cases a one-stop technology source that levels the playing field, giving them a leg up on the large firm competition. The infrastructure of the technology is completely scalable and powerful enough to handle spikes in the document production and review process while providing a quick turnaround.

“It definitely leveled the playing field for us in this case,” Walker said. “The folks at InterLegis were willing to tweak the database as necessary and to really work with us to make this win happen for our client.”

The Key Tool

Carr said the object is for InterLegis to be intelligent enough to do a lot of thinking for its users. It’s designed to think in concepts and understand what the documents say, then notify the user of potentially relevant documents. He said with InterLegis technology there is no longer a need for multiple vendors because InterLegis provides one solution that includes simulated matching, natural language search capabilities, e-discovery, Web repository and key concept searches for one price, thereby streamlining the process.

“When we take on a case, we like to come in and understand what the case is about; compile relevant terms, issues and facts; and determine who the players are,” Carr said. “Then, we can set up the database to look for those concepts and flag the necessary issues for the clients as soon as they log in.”

Carr said InterLegis takes great pride in its customer service support team, which is entirely U.S.-based, rather than outsourced to foreign countries. The company provides service around the clock, including nights and weekends when lawyers preparing for trial often need assistance.

Rose said he likes the speed of InterLegis’ search engine, which allows him to toggle quickly between documents and provides a flexible keyword and key document search tool. In the Interstate case, Rose Walker had many blueprints with information handwritten on them. InterLegis made modifications to the database before it started scanning documents into the database to accommodate these unique documents. The modifications were beneficial in locating duplicates and identifying differences in the margin notes.

Rose and Walker divided the liability and damage issues. Then, each searched the database on those issues, saving the client large sums of money in labor time. They agreed that a small firm such as theirs could not handle a large case without this technology. Both said InterLegis provides lawyers and paralegals more job satisfaction because they can move through documents in a fast, efficient manner without becoming exhausted and losing interest in the case.

“More and more lawyers or clients are hiding documents when producing hundreds of thousands of pages to you,” Walker said. “Often they produce documents at trial that you have never seen and claim these documents were, in fact, produced to you. The biggest advantage of the InterLegis technology is we can determine in seconds at trial whether the document actually was produced to us during the discovery phase.”

Walker then can put a paralegal on the stand to swear he or she searched every page of a 3,000-page document production and the document being presented was not produced. It presents a very compelling argument against this type of maneuvering by opposing counsel.

Rose Walker attorneys and paralegals find the database very user-friendly, according to Rose. “If I can use this, it’s user-friendly,” he said.

Walker said he likes that InterLegis works so well with Visionary, allowing him to put on a great audio visual and mixed media presentation of the case to the jury. Visionary is offered for free when downloaded from the Visionary Web site. A professional version also is available for about $500. InterLegis is an application service provider model. The company charges on a per page basis, plus monthly hosting. The per page processing fee buys the Document Intelligence technology, including concept folders, similarity matching, auto coding, auto dating, keyword search, concept search, natural language search, as well as unlimited users, logins, foldering, collaboration, calendaring, Web-based training and support. Depending on the size of the case, the hosting fees usually start two to six months after online access has been granted.

InterLegis can be used in hearings, at arbitrations, at trial and in instances where large matters can be handled by a small number of lawyers. “We have not used [Verdict Systems’] Sanction or Summation in more than five years,” Rose said. “We would strongly urge small firms to try InterLegis on their next case. It’s more efficient, and there is no substantial cash outlay.”

Keeping Up With the Big Firms

Both Rose and Walker moved from the large law firm environment, where they were partners at Gardere & Wynne, to create the small firm of Rose Walker in July 1999. They said they feel strongly that technology is particularly important to small firms because it enables them to take cases only large firms were once able to engage in.

“For the small- to mid-sized firm, this technology is manna from heaven,” Walker said. “They can make choices without a committee decision, and they are more flexible to try new technology. Often in a big firm, the infrastructure and committee decision-making process makes it difficult to implement change.”

Janet Roberts is a senior news and information specialist in the department of marketing and communications at Case Western Reserve University in Cleveland, Ohio, and a freelance writer. She currently is working on a master’s degree in communications at Edinboro University of Pennsylvania.

www.rosewalker.com