Cost versus Collectability

Should I sue? Cost versus Collectability

cost versus collectibilityIt is very common to have an open-and-shut fraud case but no realistic remedies. Unless you want to waste money or just make a point for principle, the defendant must be solvent. Most defendants are not solvent. If they were, they would not have cheated you out of your money. If the case is to make financial sense, there must be a defendant who is a “deep pocket”. Usually this defendant is not the perpetrator but a mostly innocent fellow-traveler. Examples include directors of companies, professionals, and employers who fail to keep a watch over the perpetrator.

A simple fraud case will cost over $25,000 in legal fees. If a vigorous defense is asserted the fees can easily exceed $75,000. It is not uncommon to spend over $200,000 to prosecute a fraud case. Often a clearly liable defendant will spend large sums in a non-meritorious defense. The plaintiff must also spend to respond to each defense motion and to each defense trial witness.

Small Claims Court

More on litigation

For smaller cases, you should consider small claims courts to solve a cost versus collectability problem. They are limited in damages ($5,000 in Oregon and Washington) in damages. One advantage is that attorneys are not generally allowed. It is often wise to reduce your damage claims so you can use the small claims process.

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