Ellen Greiper Quoted by Carrier Management in Social Inflation Article
New York, N.Y. (June 1, 2020) - New York Partner Ellen Greiper was quoted in a Carrier Management article titled “COVID-19 Court Delays May Turn the Social Inflation Tide,” which discusses the impact that the coronavirus pandemic has had upon social inflation, and highlights the insights Ms. Greiper shared during a recent Advisen webinar on the topic.
The article explains how Ms. Greiper participated in an Advisen webinar in mid-May titled, “Social Inflation: Truth or Fiction?,” during which she offered her perspectives on social inflation, namely, the phenomenon of rising insurance claim costs due to larger jury awards, societal trends, and views toward litigation. During the webinar, Ms. Greiper, who is a member of Lewis Brisbois’ Construction Practice, observed that she was “seeing a change due to COVID,” and particularly an uptick in the number of plaintiffs’ attorneys who were seeking to settle lawsuits. Ms. Greiper shared, “I have had a flurry of phone calls, I would say in the last two weeks, from plaintiffs who are now willing to take that [settlement] amount I had offered before.” She added, “The plaintiffs who weren’t calling me back before [lockdowns] are now calling. Those plaintiffs are realizing that they are not going to get a trial for at least two years, no matter what status their case may be and whether it’s discovery or past that. So now they are coming out of the woodwork.”
According to the article, the emerging trend that Ms. Greiper describes could be an indication that social inflation trends are changing as a result of the COVID-19 pandemic. During the Advisen webinar, Ms. Greiper theorized that court closures due to COVID-19, as well as uncertainty about when the courts would open, were likely driving the shift in inflationary litigation trends. “I have been told off the record by persons in the high seats in the courts that we will not be seeing jury trials until 2021 at best,” she said. Ms. Greiper further explained that logistics surrounding virtual proceedings, such as depositions, were also contributing to litigation delays. “Because it’s taking so long, I expect cases will take longer to come to fruition,” she noted.
Ms. Greiper also noted that jurors’ perspectives resulting from the pandemic could contribute to a decrease in verdict amounts and thus could be fueling plaintiffs’ desire to settle, explaining, “[Plaintiffs] are starting to realize that when we all come back and the jurors don’t have jobs or they’ve been furloughed, they’re not getting $10 million on a cervical fusion. They may realize that’s a ridiculous amount of money.” Ms. Greiper also commented that plaintiffs’ circumstances may similarly contribute to the trend toward settlement, noting, “It’s the plaintiffs themselves who may be out of a job now, or may be losing money that want to settle.”
The article also quoted Ms. Greiper on whether the notion of social inflation was truth or fiction. “It’s absolute truth," she said. "I see it in the trenches. I see it happening.” Ms. Greiper further described that she has seen “exploding case values” in recent years. “We now have plaintiffs that ask me for my excess. They really don’t care about the primary policy anymore. They want to know what the [liability insurance] tower is,” she said. “In the major cases, we’re discussing $50, $60, $70 million on trucking cases. This is no longer unique. This is now commonplace.”
Ms. Greiper also opined as to the factors that have propelled the social inflation phenomenon. “Social inflation is being driven by corporate mistrust, the reptilian theories that plaintiffs are using, the erosion of tort reform, which seems to just [have] gone out the window, and litigation funding,” she observed. With respect to r"eptilian" tactics, Ms. Greiper added, “It’s based on emotion, not on fact. . . . That’s why we have to be particularly careful with our corporate representatives who are produced in the deposition, so that we can avoid that as best we can – so that we have not laid the groundwork for it at trial.”
According to the article, Ms. Greiper recommends that defense attorneys become more aggressive to combat social inflation. She explained, “We can’t sit back and just wait for plaintiffs to do something and then respond. When we get these big cases, then we immediately set up a meeting with the insured – immediately, because it’s all about the risk management.” In further describing how to proceed with suchcases, Ms. Greiper advised, “Meet with the clients early on. Find the documents that are going to be lost in six months. Let the insured know that this case is just as important to you as it is to them.” She added, “This will actually help minimize your loss later on. You’ll be very surprised at – thinking out of the box and meeting with the client – how much that can help you later on when you’re looking to resolve the matter.”
Finally, Ms. Greiper commented upon the importance of communicating with the insurers, noting during the Advisen webinar, “It also helps to keep being the intermediary between the primary and excess towers. It’s very important that everybody be kept in the loop early on, so that you have a united defense as opposed to the primary pointing things to the excess.”