Transcript:

Adam: Welcome back. I'm Adam Massaro, partner in the Denver office of the newly founded Reed Smith, and this is Disputes in Perspective, and I've got a new special guest with me, Chris Mosley, one of my partners as well. Chris, introduce yourself.

Chris: Thank you, Adam. I'm Chris Mosley, as Adam indicated. I'm a partner at Reed Smith's Denver office. I'm part of our insurance recovery group, a group that's well known across the country. In fact, we were just identified by Best Lawyers as the insurance recovery group of the year, and it's a pleasure to be here and chatting with you, Adam.

Adam: We just passed our year anniversary at Reed Smith, founding the Denver office, one of the largest original formations of office here in Denver recently, and you are one of the founding partners. What attracted you to make the move and bring your team up?

Chris: Well, there were a few things that attracted me when I was contacted by Reed Smith. Given what I do as a commercial policyholder lawyer, Reed Smith has the largest commercial policyholder platform in the country. We've got more than 80 lawyers coast to coast. Many of those lawyers I've known over the years through cases and through different organizations with which we've been mutually associated. I knew the people and I knew it was an excellent group and one that had a bent strength and depth of knowledge that was unmatched across the country, and that was very appealing to me.

It was also appealing to me because I thought that the manner in which Reed Smith put together its Denver office was the right way to do it. I have been a part of other office openings. Some have gone well and some have had some challenges. Where Reed Smith got it right was to put a great deal of thought into what the office would look like, who would be a part of the office, and really spent an 18-month period of time recruiting lawyers, top lawyers such as yourself, Adam, from various firms across the city rather than, say, for example, just acquiring a small group of people or taking over a firm.

Reed Smith made a concerted effort to get what Reed Smith considered to be the best lawyers in town. That, to me, is the right way to go about opening a new office with a game plan on how to expand that and to continue to add the top lawyers in town. That attracted me.

The third thing that attracted me was I brought along a partner of mine, Brooke Yates, who is a fantastic insurance recovery lawyer, and an associate, Steven Robin, who is a senior associate, also a highly talented insurance recovery lawyer. I wanted to be at a place that I felt would give both of those two the opportunity and the platform to grow their practice the way they would like to. I found that Reed Smith has been terrific in that regard.

Adam: I want to talk a little bit about the insurance work you do. Everyone hears insurance, they think insurance defense. That's not what you do. What do you do then in that space?

Chris: That's exactly right. What we do is to help businesses with any issue that they may have in which the word insurance arises. Frankly, what our job is, insurance is never easy, but our job is to try to bring some talent, bring some good advice, bring some counsel and guidance to our clients when the clients have a sticky insurance issue.

To that end, I actually purchased for my team a couple of years ago a bunch of the Staples EasyButtons because that is our theme, is to try to make the insurance issues as easy as possible for our folks. What most people see is when we sue insurance companies. We absolutely do that. We're trial lawyers. This is what we do.

We help in so many other ways. We can help on the front end when clients are negotiating policies or trying to work through a global risk management strategy. We help when claims arise to try to get the claims resolved before litigation is necessary. While we enjoy trials, most of our clients would like to try to get a resolution early on as efficiently and effectively as possible. That's our goal.

When it comes time to litigate, we are ready to roll. That is what we do. The way we bring ourselves to our clients and prospective clients is simply this. If you have an issue, no matter what the issue is, and somewhere in that issue the word insurance arises, we can help you because either we can do it, and if we can't do it, we know where to go to get this accomplished, whatever the case may be. That's what we do for our clients.

Adam: So let's use an example. We start, let's say, for example, a company that is looking at D&O insurance. They've got directors and officers. Where can you provide value at the beginning before there's any type of loss issue?

Chris: Absolutely. The value we can bring at the beginning is to try to help the client obtain an insurance policy that will be the right policy for the client, cover the major risks that the client has, so that when a claim comes down in the future, there is a much higher likelihood that the claim will be covered.

So the way we do that is that we, because we have extensive experience with directors and officers' liability insurance across the platform, we will meet with the client, and typically with the client's broker, and go over the client's current program, find any areas of dissatisfaction that the client or the broker may have, and come up with a game plan to try to obtain a policy that will achieve the client's goals.

The broker will go out to the market and solicit some opportunities, at which point we, in conjunction with the client and typically the broker, will then assess the proposed insurance policy and negotiate the terms and conditions of those policies. They're good off the shelf, but they definitely need work. And so we will work with the underwriters, we will work with the brokers and the client to come up with terms that are going to be most favorable for us, and we can do that remotely, but it's not unusual for us to travel to Ramida or London to get that done for our clients.

And that's one of the things that we can do on the front end, to get yourself the best product you can, so that you can minimize your chance of a coverage fight down the road.

Adam: Let's fast forward. Same concept. We now have a loss. Somebody has sued the directors and officers. Obviously, situation works beautifully and coverage is allowed. We're great. But if that doesn't happen and we're still in that early phase, there's no judgment, we're just in the phase of figuring out defenses, things like that. What role can you play at that point?

Chris: Certainly. So in that situation, the first thing that we want to try to accomplish is to get the insurance company to agree to the selection of counsel that our client would like to choose and to reimburse at the highest rate we can get the insurance company to reimburse. Sometimes we can get the carrier to reimburse the amount of illegal fees entirely, and sometimes we have to negotiate some sort of amount. Every situation is different.

But that's the most important thing up front, is to secure the defense and make sure that the client receives the protection that it needs in order to help finance what usually is a very expensive litigation, and at least try to start the process with having the client and the insurance company on the same page. That's our goal.

If we cannot accomplish that for some reason, then we will consult with the client on how to move forward with the litigation. And if necessary, we will initiate litigation or arbitration, depending on what the policy provides, to enforce the client's rights, to have the insurance company pay for the client's defense. So our first goal is to try to do it the nice way, but if we have to do it the hard way, we're prepared to do so.

Adam: Then let's assume a circumstance where carrier denies coverage, doesn't afford a defense, and then at that point, there is an adverse judgment against the DNOs. At that point, if they either come to you then or at a prior point, when you talk about litigation, what is the type of litigation that you offer?

Chris: So the typical litigation will involve two basic areas of claims. The first is a straight breach of contract claim. That's what we call a coverage claim. Simply enforcing the insurer's obligations and enforcing the client's rights, the policy holder's rights under the policy, to obtain coverage for defense costs, to obtain coverage for any settlement or judgment that may come against the client. That would be with respect to a primary insurer, and if there's a tower of insurance, up the chain with the various excess carriers that may exist.

The second area of claims that we will pursue, depending on the jurisdiction, but we will always consider it, is the extra contractual claims, where people generally understand as a bad faith claim. And those are the types of claims that will allow a client to receive extra contractual damages in the form of statutory penalties, other statutory remedies, punitive damages, other consequential losses that may have arisen as a result of the insurer's misconduct, things of that nature.

And so if you have a case where, say, $50 million is issue, and you have a full success at trial, then what we would receive would be the $50 billion for coverage, and maybe $75 million in punitive damages, and depending on the jurisdiction, attorneys fees as well. So those would be the types of claims that we would pursue.

And the insurance industry well knows who Reed Smith is, and how good we are, and they know that when we show up as the counsel for the plaintiff in one of these cases, the insurance companies take that very, very seriously.

Adam: I'm always interested, corporate cases in general, we have to be thoughtful of how do we present this at trial, any corporate case, because we're not always a sympathetic plaintiff. In many cases, at minimum, we're just another corporation. And especially now, we're doing a layer of insurance with a layer of contract, plus some bad faith element. What's themes, theories, how do you present these cases when you actually get to the finish line to still make them compelling, so that you get the decider of fact to award the highest amount?

Chris: Sure. Well, that process starts well before the filing of the complaint, because by the time the complaint is filed, we have an understanding of what the coverage obligations are. Given our extensive experience in this area, we have an innate understanding of whether the insurance companies have failed to meet their obligations, consistent with insurance industry customs and standards. That's the bad faith standard. And so we know this ahead of time.

We also understand what the trial is going to look like, what opening statement is going to look like, what the story to the jury is going to look like, what closing arguments are going to look like, and how we want to present this. So there's a number of ways to do it. But here's the way that I typically do it.

I understand that many jurors have a negative impression of insurance companies, which will put me one step ahead, not four or five, but just one. And I think where people in my profession fail is if they just assume they're four or five ahead, and they don't do their work. They also don't think about, well, why do jurors generally disapprove of the insurance companies? Because the insurance companies do things that are upsetting to folks. They take forever to respond to a claim. They nickel and dime a claim. They do these types of things.

And so I also recognize that I represent big corporations. So these corporations, though, are very sophisticated in, say, the ski industry, or the construction industry, or the banking industry. But they're not sophisticated. Their area of focus is not insurance. And frequently, insurance companies will try to play the sophistication card. And my response, of course, is you're really good as an insurance company, but you know nothing about the ski industry.

So fundamentally, here's the approach that I take. I take an approach which I call doing the insurance company's job for the insurance company. You can flip that over and call it giving the insurance company an uproar to hang itself. And what we do is we go to the nth degree to try to provide the carrier every piece of information it's looking for. If we think the analysis is wrong, we try to lay out chapter and verse why the analysis is wrong and what the correct analysis is. And we give them plenty of time to do it.

Now, when I'm writing these letters, I'm writing them not to the insurance company. I hope they are addressed to the insurance company. And I hope they will persuade the insurance company. But I understand the ultimate trier of fact is going to be the jury. So I am writing these letters to the jury in a language that the jury can understand. So that my end goal is when I finish closing the argument, I want the jury to look at my client and say, you have the patience of Joe. I would have sued these folks six months ago. How much money do you want? And that's kind of the idea.

And one of the nice things about being a plaintiff's lawyer in this area is that you can generate some of your evidence consciously before you get to the point of filing a lawsuit. And I think that's very important. So that's really the approach that we take is just to tell the jury we didn't want to be here. We've tried to do everything we can to convince the insurance company to do this, and they just simply refuse. So the only the last recourse that we have is to come to you, the jury, to enforce these rights and to let the insurance company know that it cannot act this way.

And in that regard, you cannot do this. I get my breach of contract claim and you cannot act this way. I get my extra contractuals. And that's the approach that we typically take. And I also find that if you do the right thing with the carriers, you are more likely to reach a resolution early on. But my folks always told me, do the right thing all the times and eventually good things will happen.

Adam: I think it's wise to empower the jury. When we go before them and ask for these large seven, eight or nine figure amounts, you absolutely have to empower them because if you don't have the feels behind it, there's not much you can do there. Last question on this insurance piece of it. Give me a few examples of some of the wildest or most atypical losses you've seen over the years.

Chris: Well, there's been a few, a couple that come to mind. I had an aerospace client that put together engines and three quarters of the engines were for military use. So they were supposed to explode. And so there was nothing there. But about 25% of the engines went on launch vehicles that would go to the international space station. And we had a case where our engine failed 15 seconds into liftoff and there was a major explosion and it led to a significant coverage claim.

In that litigation, we were dealing with something called a space liability policy that had a policy limit of 2 billion with a B, not 2 million, 2 billion. And the claim was significant. It wasn't 2 billion, but it was significant. And in the deposition of the underwriter, I asked the underwriter, if the space liability policy isn't designed to cover a launch failure, which would be the most significant non-military risk my client had, what is it supposed to cover?

The first, the claims, the claim person said, I don't know, asked the underwriter, which was a really interesting response. And then I asked the underwriter and the underwriter said, well, consider this example. Let's say that there is a launch off of Cape Canaveral and two minutes into the launch, the engine fails and it causes the launch vehicle to careen over the Atlantic ocean. And in doing so, it crashes into a cruise ship and kills lots of folks. That's the type of thing that is covered. And I thought in my head, is that really what you want to tell a jury?

On a more say oil patch type of situation, I had a case in which a company was bringing a pipe that was to go into a fracking well. And the way that the contract and the policies and the law work was that the company that was transporting the pipe was responsible for anything that happens to the pipe until it gets into the hole. And then the operator was responsible once it got into the hole, where you can sort of see where this is going.

They're putting the pipe into the hole, part of the pipes in the hole, part of the pipes on the truck and it breaks. And in law school, you can't make these things up. And so those are a couple, but I will tell you one of the most fascinating things about doing this insurance recovery work is that literally every business has insurance. And so when a business shows up with an issue, half the fun is just really understanding what that business is all about.

And I learned that lesson when I was a first year dealing with a winery claim, and I didn't really know anything about wine drafts and all the rest of that stuff. And it was really fascinating. And that's what kept me really was the hook that got me into this, but you get them in all shapes and sizes.

Adam: I want to switch as we start to wrap up and talk a little bit about your practice and growth in it. I think at the partner level, I sort of think of the normal maturation as you work your way up there as the associate, become a go-to associate, then you become a support partner and kind of work your way through the process. But at some point you want to switch and you want to have a team and all those things. But part of that is maintaining consistency while at the same time, growing the business, all those pieces. For you and someone that runs a team, what have you learned? Is it the easy way or the hard way about growing a team? And have you gotten that success to actually create the team and make it work together?

Chris: That's a really great question. So where I have found success in developing a team is being willing to invest in the team. To give you sort of a counterbalance on that, I've heard multiple times over the years, partners saying, we should just hire third-year lawyers. We shouldn't get a first-year lawyer. They're all going to leave and we invest all this time. Of course, you may never say the other side of it, which is right. And we poach lawyers from other firms as well.

But what I have found is more successful is invest in your people personally, invest in your people. Not every associate or junior partner that you run into is going to have the drive or desire to do what you want to do, but you don't know which ones are going to be the ones who are going to thrive and want to do this and don't without actually investing. And besides, many people invested in my success. It's the least that I can do is to invest in their success. So I may sit and train five associates and only one or maybe two come along forward with it. That's fine.

And it's a lot of work. And when I say invest in them, I mean at every level of their career. So investing and teaching them how to do things. I get my folks involved in business development activities from day one. And giving them advice on how to manage the balance between home and family. I get invested in their families, who their spouses are, who their kids are, what are the things that they do.

And especially when they have younger kids, I tell them we need to get work done for sure. But you let me know if you have something coming up. I don't ever want you missing a school event or a sporting event, but we can talk about how we're going to get things done and do that. And I think when folks believe that you believe in them and you give them those opportunities, they become very grateful and they become very loyal to what you do. And that to me is really the biggest factor of success.

You do also have to understand though, when you find someone who's just not going to fit the bill, then you've got to let them float to another team and whatever it is they want to do. And it takes time, but like anything else that's worthwhile or that takes time, it's very worthwhile when you do it. And it's very, very rewarding when you see your associate elevated to partner and you see your partner elevated to equity partner. It is way at the top of rewarding things in my career as a lawyer is to see those folks succeed.

Adam: I'm glad you raised the timing component because I do think that's a lot of a tone at the top issue where the lead partner has to drive planning all those pieces. It makes perfect sense. But oftentimes when you look at burnout, a lot of it's, well, there's these compressed deadlines, but the flip side is if you at the partner level at the highest level are really projecting thoughtful deadlines, all those things, a lot of these messes that burn people out, I think can be avoided. So I think that's a really good point.

Chris: That's absolutely right. And when I tell folks about a deadline, I explain why the deadline is. And I even tell them, I usually build in a couple of days in case things happen. And I explain what my schedule is and why I need it on a particular timeframe. You've just got to have good communication and trust.

You can't, particularly as an equity partner, I mean, Adam, you and I are partners. I'm just like, we're just regular lawyers, but the baby lawyers look up to us like we're something scary and all the rest of that stuff. And I've never understood it, but I've taken it to heart. And so I do everything I can to make my folks feel like they're part of the group.

And I also, as you mentioned one point that I think it's really important, and that is my role at the top is decision maker. So when I have my team, whether it's a first year associate, paralegal, senior partner, whatever, I get my team together and I say, I want to know your point of view. And there's a lot of reasons I do that with first years, but I want to know your point of view because maybe you have something that I haven't thought of.

But then what I also tell my associates and the people who work with me is, okay, my job on the scene, we're all equal on the team. We all have roles. My job is to make the final decisions on stuff. And if I have an associate who strongly opposes my decision, all I ask is execute it to the very best of your ability. And if I'm wrong, you have every right to come up to me and say, I told you so. And I'm serious about that. I let them do that.

Adam: Let's wrap on longevity and private practice. I've been practicing for 16 years. I think you've got me doubled. And maintaining, it's almost like living on Mars, where it's life is not necessarily intended to live where we live. I'm curious from a longevity perspective, what have you done? Because we lose so much knowledge, unfortunately, because people do leave private practice too early. But for you, how have you made it work? And what are some of the specific things you've done along the way?

Chris: The most important thing that I've done and that I counsel every lawyer I talk to is to understand what it is that I want in my life. It's something I call the picture view of life. You have a picture of what you want your life to look like. In that picture, everybody's different. Some people will say, I want to be a 4,000 hour a year lawyer. That's their picture. That's great. Others are going to be something else. Mine was, I wanted to raise a family and work at a big law firm and make the whole thing work out. That was basically my picture. And so that's where you have to start.

And as you put that together, you have to have an understanding of what it's going to cost to do that. Nothing comes for free. Even if you're like, hey, I just want to work 20 hours a week, that's fine. There are going to be some financial consequences to that. Are you OK with that? If you are, that's what you do. So that is the number one most important thing.

And then within that, you also have to make sure that you provide a balance for yourself in some way, shape or form. As my kids were growing up, my particular balance was two things. One was exercise. I used to play basketball. My niece finally told me it was time to stop. But I coached baseball for 15 years for my two boys. And I showed up at every concert and every soccer game with my daughter that I could. That was a release for me. That was really a nice thing to do.

I always made sure Christmas was open. And we can do that as trial lawyers when the judge says, are you available for trial on January 4th? You're like, no, I'm not. February 4th, I am. So you have to have some sort of release. My kids are now grown and out of the house. And so now my balance is I play baseball and I dedicate that to myself. I'm in the process of getting ready for the season because that's a nice release for me that allows me to come back and put all the energy that I want into this.

It also helps that I have a fabulous wife who also is developing her practice as a marriage and family therapist. I just say, yes, dear, you tell me what to do and this all will be good. But that's sort of the picture that I have. And it does require me to make certain sacrifices, but they're sacrifices. When you go and buy a steak at a restaurant, the sacrifice you're paying is $60. Are you OK with that sacrifice? Is that a well, is that a good investment?

And to me, that's the biggest thing. So understand what you want your life to look like and then incorporate your legal practice into that and make sure you have something outside that can balance that. Because what we do, especially in big law, is super rewarding. One of the most interesting things I think you could ever do, but it is demanding and you got to make sure that this is what you want to do and you have a way to balance your life out so you can keep chugging along. But it's been a great 32 year run so far.

Adam: Well, I appreciate that is all the time we have today for Disputes and Perspectives. I'm Adam Massaro and this is Chris Mosley. We're coming at you from the Denver office of Reed Smith. Thank you, Chris.

Chris: Thank you, Adam. Really appreciate it. And thanks to everybody who's watching.

Outro: Disputes in Perspective is a Reed Smith production. This podcast was produced by Shannon Ryan and edited by Julian Baughman. For more information about Reed Smith's litigation and dispute resolution practice, please email [email protected]. You can find our podcast on podcast streaming platforms, reedsmith.com, and our social media accounts at Reed Smith LLP.

Disclaimer: This podcast is provided for educational purposes. It does not constitute legal advice and is not intended to establish an attorney-client relationship, nor is it intended to suggest or establish standards of care applicable to particular lawyers in any given situation. Prior results do not guarantee a similar outcome. Any views, opinions, or comments made by any external guest speaker are not to be attributed to Reed Smith LLP or its individual lawyers.

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