“Anyone with money can sue anyone [with] less money and put them out of business”

by Walter Olson on March 3, 2010

“It doesn’t matter whether you have a case or not.” Reflections on legal friction between competing websites that assist in bringing reporters together with sources [Alain Raynaud, FairSoftware, via Pete Warden]

{ 2 comments }

1 BL1Y 03.03.10 at 12:15 pm

There are a lot of things wrong with our legal system, but this claim is simply not true. Not only would it be hard to sink a business with legal fees, but if you don’t have a colorable claim, it’s going to be hard to find a good lawyer to represent you, since a savvy defendant will almost certainly push for sanctions against the attorney.

2 Stewart Peterson 03.03.10 at 3:04 pm

Really? Microsoft or Apple or Google or Sun couldn’t file a baseless lawsuit against Mom & Pop Software Inc. and drag it out with discovery, technical motions, appeals, whatever-the-legal-term-is-for-suits-resulting-from-other-points-brought-up-during-a-suit, etc., and make MPSI retain counsel for years, destroying their profit margin, while waiting for something to happen to their market (and, given enough time, something will)?

For this approach to be really successful, the plaintiff does have to have a perception of a case (not necessarily a real case). Look at asbestos – enough people were convinced that there was a case there, because the lawsuits were accompanied by good PR on the part of the attackers, that the whole industry was put out of business. I’m not saying the perception necessarily was or wasn’t valid, just that validity doesn’t have anything to do with perception; it could be valid or not, but the outcome would have been the same either way, just as a plaintiff with a good case can lose.

I recall, just anecdotally, that when the Black Hills Institute of Geological Research was brought up on 150-odd white collar charges during the mid 90s, their legal fees were cited as being “over $100,000″ (can’t find the source; if you think that’s an unreasonable figure, throw things at me). Of course, that’s a criminal case, not a civil one, but I doubt the legal fees would have been much different (tell me if I’m wrong) and a lot of businesses don’t have $100,000 sitting around. And that wasn’t even with PR – usually an attack lawsuit is accompanied by an attempt to destroy the target’s market or freedom to operate.

IANAL, but how is a lawsuit not simply a battle of attrition? If the other guy can pay his/her lawyer longer than you can pay yours, and they can drag it out beyond the point where you run out of money, they win, no?

Comments on this entry are closed.