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I’m Gonna Sue the S.O.B.

By Rob Lambert - Email Editor

Date : 13-Dec-2007

Dear Subscriber:

How often have you wanted to sue the jerk that is causing you trouble or doing you wrong? The answer is surely plenty of times.

Some people gravitate to Asset Protection Planning because they get into a lot of fights that sometimes end with a lawsuit. At least once a week I get a call from a person who is ready to kill somebody and wants to make sure that they are protected before they do it. I always stop them and ask them to focus on the potential impact of their decision and to resort to the much flawed legal system to resolve their dispute.

I also frequently get calls from some apparently decent and well-intentioned individual who is threatened with a lawsuit (frivolous or not, it doesn’t seem to matter when it comes to the personal stress level of the person being threatened). These people often look toward Asset Protection as a way to stop lawsuits in their tracks. They are often taken in by the many Internet shysters who peddle Asset Protection as just that, a way to stop lawsuits.

Nothing Could Be Further From The Truth.

It is important to understand one thing that Asset Protection Planning will not do. It will not stop lawsuits. If you are perceived as having something worth taking, you can count on the fact that there is some greedy, underemployed tort lawyer that is ready to try and take it away from you. This is regardless of whether or not you have an Asset Protection Plan in place or not. Even worse, you might find yourself haunted and hunted by some sue happy, self-righteous enemy who wants your head on a platter for principal.

Fact: Asset Protection Planning Does Not Stop Lawsuits.

Asset Protection Planning will not stop lawsuits. They will still come. All Asset Protection Planning does is destroy the economic incentive to pursue a case. We correctly assume that most plaintiffs and all lawyers are greedy and want money. Once you have a plan properly implemented, and when the financial seas are calm, you now have an effective tool to favorably settle that dreaded lawsuit when it comes.

So, I encourage my customers to not expect any Asset Protection Plan to stop the dreaded lawsuit. The plan just gives you an effective tool to get out of it.

This simple fact also changes the landscape. For example, it becomes clear that keeping basic insurance in place to provide a defense makes complete sense. It also becomes clear that relying on stealth alone (e.g., phony Nevada corporations and similar techniques) is nearly worthless as a deterrent. Why? Because the basis of these terrible techniques is stealth, and the facts of the plan cannot be safely disclosed. All solid plans should take into consideration that the bad guys will discover the details of the plan. In fact, in many cases, one of the techniques we use is to actually disclose the generic structure of the plan to the bad guys to force a settlement. Once a plaintiff and his lawyer realize that they will spend a dollar to collect ten cents, they often go away or will settle.

Some Thoughts On Settlement

We all hate lawsuits (well, everybody except tort lawyers!). They waste time and money and are seldom fair. Even so, I often say to clients facing an expensive and burdensome suit: A bad settlement is always better than a good lawsuit. In the same way that most greedy tort lawyers will not litigate on principle, a protected person should not defend a suit on principle alone. Sometimes paying a little blood money is better than spending ten times that amount on legal fees to defend yourself.

So, when the dreaded suit comes, recite the above manta. Sometimes a little peace is better than the joy of truth.

Have a healthy and protected week.

Rob Lambert

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