The key to a profitable mass tort practice, and to reaching the injured people who need legal help, is to balance risk and reward. Firms that understand the mass tort advertising cycle are able to take advantage of the rewards unique to each stage in the cycle while maintaining a comfortable level of risk.
If your firm is willing to get in early, stare down some risk and take the long view, you can realize huge returns. But significant rewards can also come to those who make their move late in the cycle, when risk and reward are low. It’s all about balance.
There are three stages to the mass tort advertising cycle, and here’s how they play out:
STAGE 1: THE EARLY BIRDS
Long before many firms are ready to commit ad dollars, the most aggressive attorneys have identified a promising new topic and have hit the market hard and heavy. They’re armed with investigations into a drug or device that show potential links to serious injuries and side effects. They’ve also administered the smell test: is the drug or device covered by a preemption ruling? And does it pass the Daubert standard?
- The Reward: These firms receive a high volume of leads and usually get the highest number of high-value cases. Typically the firm with the highest high volume of cases has an interest in the case, and possibly a position on the MDL, which can yield a massive additional attorney fee at the end of the case.
- The Risk: This early in the game, litigation is not established and the case is not a guarantee. And your firm’s money can be tied up for a while before cases are resolved — typically five to six years.
STAGE 2: MIDDLE GROUND
Once a litigation topic has shown itself to have legs, many firms decide it’s time to put skin in the game. They’ve watched the progression of the litigation and want to generate an inventory of their own cases.
- The Reward: The best cases are still relatively easy to find. There is now more public awareness of the topic, making it easier for firms to generate a high volume of leads. The litigation has progressed to the point where it’s much easier to identify and qualify high-value cases.
- The Risk: Competition for cases is high and so is cost-per-lead. In some cases the statute of limitations is an issue, so finding cases quickly is important.
STAGE 3: THE SETTLEMENT RUSH
Firms that wait until Stage 3 to get in bear the lowest risk in terms of litigation costs. At this point, settlements or verdicts have usually begun coming in.
- The Reward: It’s easy to qualify leads and measure the value of a case. Since cases will most likely be settled quickly, the firm’s money won’t be tied up for long. Litigation costs are relatively low.
- The Risk: Leads can only be had at a premium price, and the lower-hanging fruit has been picked. Top-dollar cases are most likely gone. Medical records can be hard to recover, and you have to keep a close eye on the statute of limitations.
Attorneys who want to succeed in mass torts need to understand the advertising cycle and their own tolerance for risk. But the most successful firms know that where there is risk, there is reward.