Summary Judgment: Boon or Burden

 

INTRODUCTION

Civil litigation can be expensive and time consuming. The Federal Rules of Civil Procedure were adopted "to secure the just, speedy and inexpensive determination of every action." Summary judgment has been described as "the primary procedure used to avoid unnecessary civil trials." Federal Rule of Civil Procedure 56(c) provides that summary judgment "shall be rendered forthwith if . . . there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."

At the time of its adoption in 1937 as Rule 56, summary judgment was promoted by the Advisory Committee as "a method for promptly disposing of actions in which there is no genuine issue as to any material fact." This objective has not always been met. Summary judgment motions can stall and complicate a case. Summary judgment motions are expensive to prepare and require substantial lawyer and judicial resources. Local rules and procedures can further add to the burden of preparing or responding to the motion. Therefore, it is important to carefully consider the role of summary judgment in the litigation process and to promote its use where it makes legal and economic sense and to discourage its use elsewhere.

I believe summary judgment motions are excessively used and delay resolution of cases which would otherwise settle or be tried. Parties are frequently not selective in moving for summary judgment and many defense lawyers view it as a rite of passage in every case. Summary judgment motions delay disposition where a party refuses to discuss settlement until the motion has been decided. When summary judgment is denied by the trial court or granted and later reversed on appeal, the time and money spent may have been largely wasted.

Even when summary judgment is granted, the perception of justice may suffer if the losing party feels frustrated in never having seen the judge, a jury or the courtroom. An emphasis on settlement or trial, and a de-emphasis on summary judgment, would result in a more efficient, satisfying and just resolution of cases. A more selective utilization of summary judgment would better serve parties and the court.

Is summary judgment a boon or a burden to the just, speedy and inexpensive resolution of cases? This article will briefly review the history of summary judgment and discuss practical problems resulting from the overuse of summary judgment motions. I will recommend that summary judgment be used more selectively and that greater emphasis be placed on settlement or trial.

HISTORY OF SUMMARY JUDGMENT

Summary judgment antecedents have been traced back to the thirteenth century, and summary judgment finds its modern origins in nineteenth century English practice. The Summary Procedure on Bills of Exchange Act of 1855 was adopted to assist merchants to promptly collect on bills of exchange and promissory notes and to dispense with sham defenses. The emphasis was on liquidated claims. This procedure was designed to assist plaintiffs and expedite litigation which had been slowed down by England’s pleading requirements and discovery practices. This practice was later expanded to cover all actions at law, for liquidated or unliquidated claims, except for a few designated torts and breach of promise of marriage.

The English experience with summary judgment type procedures was carried over to America’s shores. Summary judgment expanded from a proceeding which applied only to a limited number of causes of action to a rule applicable to all civil cases. The movement to adopt a summary judgment procedure in the Federal Rules was pushed by Yale law professor Charles Clark (later judge of the Second Circuit) in an article he co-authored with one of his students in 1929 entitled The Summary Judgment. In their article, the authors advocate summary judgment as a remedy for excessive delay and court congestion.

Rule 56 was part of the Federal Rules of Civil Procedure which became effective in 1938. The new rule was available to defendants as well as plaintiffs. Initially, the Rule was not widely used because of a perception that summary judgment would be reversed on appeal.

Following enactment of the federal rules, the Supreme Court addressed summary judgment on several occasions. In Sarter v. Arkansas Natural Gas Corp., the Court held that a proper summary judgment required "evidence which a jury would not be at liberty to disbelieve and which would require a directed verdict for the nonmoving party."

In Poller v. Columbia Broadcasting System, the Supreme Court reversed a summary judgment stating that "summary judgment procedures should be used sparingly in complex antitrust litigation where motive and intent play leading roles, the proof is largely in the hands of the alleged conspirators, and hostile witnesses thicken the plot."

In 1986, the Supreme Court rendered decisions in a trilogy of cases -- Celotex Corp. v. Catrett, Anderson v. Liberty Lobby and Matsushita Electric Industrial Corp. v. Zenith Radio -- which gave new momentum to the use of summary judgment in light of the 1983 amendment to Rule 56. As commentators have pointed out, the trilogy brought about several significant changes in summary judgment practice. The trilogy eased the initial burden placed on the party moving for summary judgment and allowed the district court latitude in determining the existence of issues which require a trial. Prior to the trilogy, the Supreme Court’s decision in Adickes v. S.H. Kress & Co. placed the burden on the movant to "carry its burden of showing the absence of any genuine issue of fact."

Celotex relieved defendants moving for summary judgment of any significant burden of production to establish the absence of a material issue of fact and placed the burden of production on nonmoving plaintiffs to come forward with evidence of facts in dispute. Anderson expanded the discretionary authority given to the district court by recasting summary judgment into the equivalent of a motion for a directed verdict. In Matsushita, the Court upheld summary judgment despite unrebutted expert reports supporting plaintiffs’ claims because "the claim was one that simply makes no economic sense."

As a result, summary judgment, a plaintiff’s motion prior to the Federal Rules, has become a defendant’s motion. It has become a complex proceeding with legal burdens and evidentiary complexities on a par with a trial.

PRACTICAL PROBLEMS

From my perspective, the summary judgment motion is predominantly a defendants’ litigation tool which gives them powerful leverage over plaintiffs. Overuse clogs the courts and results in less justice and less satisfaction for litigants.

A. Summary Judgment Gives Defendants a Tactical Advantage

Although a plaintiff has equal recourse to summary judgment under Rule 56, the motion has largely become a defendant’s weapon. Summary judgment provides the defense bar with a major tactical advantage because it creates leverage over plaintiffs. Whereas a plaintiff maximizes his leverage through the possibility of a trial, a defendant maximizes her position by discouraging and avoiding trial.

First, summary judgment creates an additional hurdle for a plaintiff because it forces him to go through a paper minitrial to insure that his case can go forward. This provides a defendant with a preview of the key elements of a plaintiff’s case. Furthermore, a defendant who brings and loses a summary judgment motion lives to fight another day. The plaintiff who does not survive summary judgment loses not only the battle, but also the war.

Second, summary judgment can entail significant expenditures of time and money. Once a defendant files a summary judgment motion, the plaintiff is compelled to complete discovery to insure that he has put his best case forward. Depositions will be taken, transcripts prepared and potential witnesses must be interviewed to prepare affidavits. The expense can be substantial. Summary judgment motions and related briefs and documents six to twelve inches thick are no longer rare. The affidavits, depositions and discovery must be compiled along with legal briefs. Papering the motion and preparing technically correct affidavits consume a greater part of a lawyer’s day.

Third, summary judgment delays the ultimate disposition of the case. Many defendants will not engage in serious settlement discussions until a plaintiff can establish that he can survive summary judgment. Furthermore, most defendants against whom monetary relief is sought prefer to delay trial when possible because of the time value of money. Therefore, defendants are inclined to move for summary judgment even where the chance for success is small.

B. Overuse Results in Less Justice and More Dissatisfaction

The result of overuse is a backlog of summary judgment motions before busy federal judges. The courts consequently dispose of numerous cases with summary judgment. From time to time, the decision to grant summary judgment rests on a procedural oversight in preparing the necessary papers rather than on the merits of the dispute. Marginal cases are now shown the door without a trial. Parties are thrown out of court without ever seeing a judge or jury, but only a pile of affidavits, briefs and a memorandum opinion. Summary judgment has even been granted in cases involving questions of reasonable conduct. This leads to disgruntled plaintiffs and counsel who believe they have been deprived of their day in court and their constitutional right to a jury trial.

Although summary judgment can be useful in cases where legal issues divide the parties, my experience is that summary judgment motions are filed in too many cases involving factual disputes. It is time to re-examine the proper role of summary judgment in the litigation process.

SUGGESTED SOLUTIONS

Summary judgment motions should be actively discouraged and emphasis should be placed on settlement or trial preparation. I have the following suggestions which counsel and the court should consider in contemplating a summary judgment motion.

A. Talk Before You File

Opposing counsel should confer before a summary judgment motion is filed. The moving party should initiate communications to explain why summary judgment is appropriate. The respondent should explain what material fact questions exist and the factual basis by which the issue is created.

A number of potential benefits may result from early discussion which focuses on the merits and issues raised. If this conversation takes place before all the heavy lifting in preparing the motion is completed, the parties may avoid filing premature or losing summary judgment motions. If the discussion leads to a narrowing of the issues or an explanation from respondent as to how he will prove that a fact question exists, the motion may become moot. This discussion can streamline the case. Parties should be encouraged to weed out losing or trivial claims through discussion rather than a full blown summary judgment proceeding.

These discussions should also include the topic of possible settlement. Settlement may be easier to achieve when neither side has incurred the cost of litigating summary judgment. Early dialogue can lead to serious settlement negotiations, avoid premature summary judgment motions, and simplify issues for trial.

B. Avoid Premature Summary Judgment Motions

Before filing, a party should consider whether the case is ripe for summary judgment. Summary judgment motions which do not involve clear cut legal issues are often premature before the close of discovery. Rule 56(f) provides the respondent with the opportunity to seek additional discovery in order to respond. Therefore, an early summary judgment motion may result in delay as the necessary discovery is completed. Courts are reluctant to enter summary judgment before the close of discovery.

C. Consider the Amount in Controversy and How Long the Case Will Take To Try

Summary judgment should be actively discouraged for cases that can be tried in less than a week or which involve relatively small sums of money. This is particularly true where the number of witnesses is small and are within the Court’s subpoena power. Consider the amount of effort required in preparing and responding to summary judgment. Not infrequently, summary judgment motions and their supporting papers cost over $10,000 per side to prepare. These costs should be compared to the amounts involved in the case and the cost of trial before the motion is filed.

In smaller cases, the cost of trial may not be substantially greater than summary judgment. Moreover, if summary judgment is not successful the money spent is largely wasted, whereas trial leads to a resolution. The deferential standard on appeal to a trial result does not apply to summary judgment. Therefore, summary judgment may not be cost-effective for smaller cases.

Where a summary judgment motion is filed as a matter of course to discourage a plaintiff from litigating his claim, the court should step in and actively discourage the motion. This can be accomplished by setting the case for trial, taking the motion under advisement, and treating it as a defendant’s motion for judgment as a matter of law at the close of a plaintiff’s case. Trial judges should not permit summary judgment to be used where it undercuts the "just, speedy and inexpensive" determination of the action.

Finally, parties feel a greater sense of justice if their cases are resolved at trial rather than on summary judgment. As a judge, I would prefer to preside over a short trial than wade through summary judgment papers. It is oftentimes more cost-effective for the attorneys and the judiciary to conduct a 3-5 day trial than to prepare and decide summary judgment motions. I would be surprised if many cases involving less than $150,000 could not be prepared and tried in less time and at similar expense to a summary judgment motion.

D. Conduct A Settlement Conference Rather Than Summary Judgment

A settlement conference which gives the parties an opportunity to discuss the strengths and weaknesses of their case is more productive than the summary judgment exercise. Parties can explore the merits of the case in a settlement conference and accomplish much more towards the ultimate resolution of the dispute. Over 95% of all cases settle. Most parties are more interested in achieving a resolution than in procedure. Parties are more willing to settle when they have had the opportunity to hear first hand from the court and from the other side. Satisfaction with the justice system will increase if parties have an opportunity to tell their story and actively participate in the settlement process. Finally, judicial resources will be saved in those cases which settle without the necessity for summary judgment and the attendant appeals.

Furthermore, if a firm trial date is set rather than a summary judgment ruling date, all parties are more serious in their approach to settlement and the playing field is leveled in negotiations. Plaintiffs who have a poor case will confront this fact sooner, and defendants will be more realistic.

E. Simplify the Final Pretrial Order and Set a Firm Trial Date

In fairness to the parties and their counsel, I have coupled the discouragement of summary judgment with a simplified final pretrial order and a firm and realistic trial date. One reason for the popularity of summary judgment is that courts have made trial too expensive. The preparation of comprehensive final pretrial orders may be useful in the megacase, but has little efficacy in the large majority of cases that find their way to federal court. The final pretrial order has become a tool to discourage rather than to facilitate trial. By making trial a cost efficient means of resolving disputes, counsel and the court will be able to devote more of their attention to deciding cases on the merits. A copy of my Standing Final Pretrial Order is attached.

If courts emphasized trial and de-emphasized summary judgment, they would likely try several more cases a year while eliminating the large majority of summary judgment motions which now clog the judicial arteries.

F. Convert Cross Motions for Summary Judgment to Paper Trials

Cross motions for summary judgment are largely a waste of time. Cross-motions are sometimes both denied because each motion is considered separately and the court is compelled to look at each side in the light most favorable to the other side. Instead, the parties should be encouraged to submit to a trial on the papers by the court. A bench trial on a stipulated record allows the court to draw inferences and to make its decision based upon the applicable legal standard. In this way, a binding decision is made.

G. Discourage Partial Summary Judgment Motions

Rule 56 clearly provides for a partial summary judgment motion "upon all or any part" of a claim, counterclaim, or cross-claim. Great care should be taken before filing such a motion. If the motion does not eliminate a significant portion of the case, then the motion may not be cost-effective. If the motion will not terminate the case, the moving party must seriously consider what advantage, other than delay, is created by the motion. If you have a strong case, consider whether you are better off in not providing the other party with an issue for appeal. There is probably no more frustrating scenario than to win partial summary judgment, win at trial, and have the partial summary judgment reversed on appeal.

In cases involving multiple theories, parties generally limit their theories as the case is prepared for trial. Good lawyers recognize the importance of focusing the case to concentrate on winning theories and discarding the chaff. Furthermore, a Rule 50 motion for judgment as a matter of law may accomplish a similar function.

CONCLUSION

Summary judgment has become an expensive procedural device which is unnecessary for the large majority of cases brought in federal court. Summary judgment is often used by defendants to obtain a complete look at the plaintiff’s case and to discourage the plaintiff from pursuing his case by raising the cost of going forward, thereby coercing him into accepting a lower settlement. In those cases which would take a week or less to try, the parties and the court would be better served by focusing on settlement or an early trial date with a simple final pretrial order. This will improve the quality of justice and result in the resolution of more cases on the merits and with the participation of clients.