• A Toothless Statute Losing Its Bite: Offers Of Judgment - Why Bother?
  • January 29, 2013
  • Law Firm: Porteous Hainkel Johnson L.L.P. - New Orleans Office
  • Years ago, a client thought my dismissal of her suggestion to make an offer of judgment brazen. Perhaps I could have been more subtle explaining the hurdles to making an offer of judgment effective; when I suggested we not waste our time, I suspect she heard me say “don’t waste my time.” Since then, most have come to see the statute as a dead letter. Any remaining life was recently killed off by the Louisiana Fifth and Third Curcuits.

    Implictly adopting the federal posiiton, even though the statutes are worded differntly, the two state appellate courts have declared that a defendant’s remedies under the statute are unavailable if the defendant wins on the merits. Only if the plaintiff obtains a judgment, and then, only a judgment that is no more than 75% of the offer, does the defendant recover post-offer costs. See, Carcamo v. Raw Bar, Inc., 12-CA-294 (LaApp 5 Cir. 11/27/12); and Broussard v. Martin OPerating Partnership, 11-1559 (LaApp 3 Cir. 11/28/12).

    From the start, the 75% rule forces defendants to overbid a settlement offer before plaintiffs will ever perceive any risk in ignoring an offer of judgment under Louisiana Code of Civil Procedure article 970. Now, if the defendant’s case is too good, the plaintiff is better off losing outright than if he wins a nominal judgment that, even if nothing else, does endorse the basic validity of his complaint.

    Meanwhile, the defendant needs to figure out a way to throw the case. Slightly.