In Series 1, Chapter 2 entitled Building the Scrapbook, we recommended that you compile a log of all of the interactions between you and your homeowners insurance provider.
Now that you have decided to bring a lawsuit and have hired a legal team, it's time to start putting together a script for the theatrical production that is your lawsuit, and the scrapbook is the first outline that will give rise to the script.
The scrapbook, the outline, and the script tell your story.
Whether in Federal or State Court, the document that officially starts your lawsuit and is filed with the Court is called the Complaint.
The Complaint contains all of the facts that you allege show that your homeowners insurance provider acted improperly. It also lists all of the laws that you allege the insurance company has violated. Each of those legal claims is called a "cause of action."
As we indicated in the Series 1 Chapters called Pie and Ice Cream, and In Search of More Food, frequent causes of action that you will see in a homeowners insurance lawsuit include breach of contract, insurance bad faith, fraud, negligence, emotional distress, and others.
Systemic Risk
As noted in The Playbill, you want to start out with as big of a block of ice as can be legally justified. That means including all of the causes of action that the facts reasonably support, not simply adding claims for the sake of having more claims. The Complaint becomes the master script for your lawsuit and your story. It is referred to throughout the lawsuit, and the allegations in the Complaint will be fought over and challenged both prior to and throughout your trial.
It also is the first document that the insurance company will see when it finds out you have filed a lawsuit. It sets the tone for the entire lawsuit and determines the level of risk and seriousness with which the insurance company initially treats your lawsuit. On the topic of risk, the insurance company will immediately attempt to characterize your lawsuit as a mereone-off claim dispute between you and the insurance company.
From the perspective of the Plaintiff, it's not that one-off claim disputes are bad or insignificant or without merit. But from the perspective of the insurance company, one-off claim disputes represent limited downside and contained risk.
Part of being a better client is asking your legal team to come up with creative, out-of-the-box legal theories based upon the facts that you have given them that could elevate your lawsuit from being a one-off claim dispute to exposing the insurance company to precedent-setting or systemic liability. Your AI agent and other online resources can be a big help in this regard.
Keep informed about everything that is happening with the Defendant you are suing. How is their business doing? Have their top executives been in the news? Have they issued any statements? Have they testified at any hearings? Have they issued any press releases?
You also want to stay up to speed on any ongoing investigations. As of this writing, the California Department of Insurance, Los Angeles County, the California Legislature, and the California Attorney General are all investigating insurance companies and their responses to the Southern California wildfires.
It is easy to use the Internet and AI to stay up to speed on all of these investigations. Facts uncovered in these investigations may be relevant to your lawsuit. And any fines or administrative actions against your Defendant could potentially be used in your lawsuit as evidence of improprieties and bad faith.
Part of being a better client is keeping your legal team up to speed on what is happening with the Defendant, what they are saying and doing, and what is happening in these other investigations.
You only get one shot at bringing this lawsuit, and you need to make it count.
If, in the prescreening process, the potential lawyer you interview suggests treating your case like a garden-variety insurance claim lawsuit, you may want to continue searching for a different lawyer.
There is already evidence out there that indicates that insurance companies have mistreated hundreds, if not thousands, of Southern California fire victims. Your legal team should look for patterns that demonstrate similar poor claim-handling practices across other similarly situated customers of your insurance company.
In many instances, these patterns may not be by coincidence and could result from systemic failures or business decisions made by upper management of the insurance company.
They may not be obvious or easy to find, but these types of claims of systemic wrongdoing and institutional malfeasance can separate your lawsuit from a garden-variety one-off claim dispute.
As the lead actor in the lawsuit, part of your role is to push your supporting cast beyond their usual comfort zone to get the best possible performance from them. This includes your legal team.
Once the Complaint is filed and served, the insurance company gets an opportunity to respond.
One way it can respond is by filing a document called an Answer. Don't expect the insurance company to read your Complaint and respond, "You're right. We really did treat you terribly." The Answer will generally deny most, if not all, of the important allegations in your Complaint.
Deny, Deny, Deny is the Defendant's initial strategy.
The Answer will also likely contain a long list of what are called "affirmative defenses"—legal reasons why the insurance company claims that, even if some of what you say is true, it should not be responsible for some or all of the damages you are seeking.
When you first read the Answer, some of the denials may seem ridiculous. You may have documents proving something happened, and the insurance company may still deny it. Don't spend too much time worrying about this.
From your perspective, the Answer is generally one of the least important documents in the lawsuit. It tells you that the insurance company intends to defend itself. But you probably already knew that.
The Defendant may also try to eliminate some or all of the causes of action in your Complaint before the lawsuit gets very far.
As we explained in The Playbill, in Federal Court this may happen through a Motion to Dismiss. In California State Court, a similar challenge is called a Demurrer.
You do not need to become an expert on either procedure. But as a client, you should pay attention to what happens.
There is a difference between a creative, out-of-the-box legal theory being challenged and a basic claim, such as breach of contract or insurance bad faith—being dismissed because your Complaint did not contain sufficient facts to support it.
More aggressive or creative legal theories may attract more aggressive challenges. That does not necessarily mean those theories should not have been asserted.
But if ordinary causes of action that are routinely asserted in homeowners insurance lawsuits are dismissed because the Complaint was not adequately prepared, that may be a sign of sloppy legal work.
A poorly written Complaint will often get at least one do-over. If the Judge allows your legal team to file an Amended Complaint, the missing facts can potentially be added.
But if a number of basic claims are dismissed, it is reasonable for you to ask the lawyer in charge of your lawsuit what happened, what is going to be done differently in the Amended Complaint, and whether the problem should have been avoided in the first place.
Being a better client does not mean second-guessing every legal decision. It does mean paying attention.
Although we have called the Complaint the master script for your lawsuit, the script can change over time.
As the lawsuit progresses, your lawyers may learn facts they did not know when the original Complaint was filed. New documents may be uncovered. Witnesses may provide important information. Legal theories may become stronger or weaker. A Judge may dismiss a claim but allow your lawyers to rewrite it.
And, by using your AI agent and other online research tools, you might discover facts about the Defendant that can be helpful to your lawsuit and possibly added to the Complaint.
If that happens, your lawyers may file an Amended Complaint.
Depending upon what is learned during the lawsuit, claims can be added, changed, or removed. Sometimes new defendants can be added as well.
This is another reason why the Scrapbook you created before filing the lawsuit was important, but was only the beginning. When the Complaint is filed, your lawyers principally know what you know and what they have been able to investigate before filing the lawsuit. But much of the most important information about how your claim was handled may still be sitting inside the insurance company. That is why the next stage of the lawsuit becomes so important. Your lawyers now need a way to find out what really happened. That process is called Discovery. And that is where we go next.
The Complaint is the master script for your lawsuit. It tells your story, identifies your legal claims, and helps establish how seriously the insurance company initially views the risk presented by your lawsuit.
Start with as large a block of ice as the facts can legally support. The goal is not to pile on claims for the sake of having more claims. It is to identify every cause of action that is reasonably supported by the facts.
You only get one shot at bringing your lawsuit. Make it count. Your legal team should think creatively about whether the facts support claims that go beyond a garden-variety one-off claim dispute.
Look beyond your own claim. Patterns involving other policyholders, executive statements, regulatory investigations, fines, and other evidence of systemic wrongdoing may help your legal team better understand and frame your lawsuit.
Don't expect the insurance company to agree with your version of events. Deny, Deny, Deny is the Defendant's initial strategy. Don't become overly concerned when you read the Answer.
Pay attention when the Defendant attacks the Complaint. Creative legal theories may attract aggressive challenges. But if basic claims are dismissed because the Complaint was poorly prepared, that is something you should discuss with the lawyer in charge of your lawsuit.
The Complaint is not written in stone. As additional information is uncovered, your lawyers may file an Amended Complaint that adds, changes, or removes allegations, legal claims, or defendants
When the lawsuit begins, your lawyers principally know your side of the story. Much of the most important information may still be inside the insurance company.
Discovery is how you begin finding out what really happened. That is where we go next.
