Best Practices for Giving Case Updates

December 6, 2018
7min read

Of all the roles an aspiring personal injury attorney might imagine when they’re in law school, a “fiduciary of money” or “escrow agent” is probably far down their list. But as any personal injury (PI) attorney will tell you, it’s a large part of a PI law firm’s cost center and responsibilities.  

Let’s back up a bit: Plaintiffs need to purchase services on credit or contingency from a variety of parties in order to pursue their cases, and the only way those service providers will provide the desired services is if they think they’re likely going to get paid back. The attorney is the one who literally pays them back using the plaintiff’s settlement proceeds, and thus acting as an “escrow agent” of the that settlement.

If it was a trivial task, there wouldn't be much to write about. But, in fact, the job of an escrow agent is quite complex and time-consuming. Here are some tips on how to do it successfully and efficiently.

Case updates

Look at the numbers of a following firm in Washington D.C. (all estimated from industry experience):

1 case = average of 7 lien holders

1 attorney = average of 500 open cases

1 attorney = average of 3,500 lienholders to manage

Many lienholders believe that the best practice is to contact escrow agents for updates once a quarter on their cases. So if every lienholder follows through on that, a single attorney will receive 14,000 calls, emails, and faxes a year to check on the status of cases. Even if only half of lienholders actually do this, it’s still a huge burden for a firm to have.

So what should firms do? And what are the legal and ethical implications to consider?

First, escrow agents would be wise to get familiar with the psychology behind why lienholders ask for case updates. For many lienholders, requesting a case update is a proxy for asking the simple question: Is this case still ongoing or is the case already settled (and therefore is my payment in jeopardy)?

That’s it. Most lienholders don’t need details, because most of them are medical providers who are not in the business of deeply understanding the intricacies of personal injury cases. Especially after a plaintiff-patient has stopped treating, case updates to medical providers only are general guides as to how likely the case is to settle and when; for most medical providers, case updates are simply written down with no extra utility after received.

Knowing this can then inform how attorneys, or PI escrow agents, should respond.

The “no update” update

The vast majority (80%) of case update requests can be answered by the escrow agent and its staff with a simple answer: “There’s no update; the case is still ongoing as as is typical for these types of cases.” This answer is short and sweet.

Yes, some lienholders may want more information, which we will cover next, but if you ask lienholders, most are likely to trade sporadic detailed updates for consistent pithy ones.

The “update” update

The 80% case above still leaves about 20% of the time where a “no update” update won’t be sufficient.

Within that 20%, the most common scenario is where there is actually a notable update to share. In this case, it is important for escrow agents to be proactive in disseminating information about what happened. This is not a time killer, it’s a time saver, because if lienholders can trust that important updates will be proactively shared with them, they won’t need to follow up as much to make sure they don’t miss one.

Here are some of the most important updates to share with lienholders.

  1. Law firm is no longer representing the plaintiff

Maybe the law firm dropped the client or maybe the client dropped the law firm. No matter which side initiated, lienholders need to know this information so they can quickly get their lien on file with whichever escrow agent has taken over the duties of distributing the funds.

Many lienholders report that failure of attorneys to alert them to a change of attorney is one of the leading reasons why their liens are not paid, despite the case’s successful settlement. The new escrow agents do not have lien information on file either because they did not request it from the initial law firm, or because there were issues with the transfer of files.

So as an escrow agent, here is an example of what you might say:

Hi ABC Orthopedic,

We wanted to share with you that plaintiff Peter Paul has informed us that he switched counsel to Bobby Jones at Garden State Law Firm PLLC. That firm has not yet contacted us for our records, so you may want to follow up with them directly.


Attorney Andy

2. Plaintiff experiences death or bankruptcy

These scenarios are not entirely unrealistic. Plaintiffs do die, sometimes as a result of their injuries or for unrelated reasons. They also go bankrupt, often as a result of being out of work because of what happened to them.

When something happens to plaintiffs, lienholders have to take action; delay can cause lienholders to lose valuable time to file with bankruptcy or estate courts, or to take other actions.

Hi ABC Orthopedic,

We wanted to share with you that we received a letter from the bankruptcy court that plaintiff Peter Paul has filed Chapter 11. We are still representing the plaintiff in its case, but wanted to inform you of this event in case it’s material to you.


Attorney Andy

3. Case resolves

In the end, all cases either settle, get dropped, or win/lose in court. If a case resolves for money, lienholders need to know so they can prepare their final bills and be available for any reduction discussions that may be needed.

Here’s an example of what you mighty say:

Hi ABC Orthopedic,

We wanted to share with you that Plaintiff Peter Paul’s case has settled. We are in the process of collecting all liens on this case so we may pay them out accordingly. Can you please confirm the total bill for your services is $30,000?


Attorney Andy

It often happens that a case resolves for less than the total liens on a case and attorneys must ask lienholders for a reduction of their full bill. Here’s an example of what you mighty say:

Hi ABC Orthopedic,

We wanted to share with you that Plaintiff Peter Paul’s case has settled.  The total settlement, though, is not enough to cover all of the liens on the case and therefore we have to ask everyone to reduce their bill pro-rata by 33% in order effectuate the distribution of settlement funds. Can you please reply to this email with “I accept.” and I will take that to mean that you agree to accept $3,000 in full and final payment of your liens on this case. If you do so agree, you should expect payment within a few weeks.


Attorney Andy

There are other scenarios where certain lienholders need details about what stage a case is at, what the next milestone is, if there’s a new or updated expected settlement date and, depending on the lienholders, other idiosyncratic information. In general, you should only give idiosyncratic updates when necessary. The next article will provide a few key things to consider when you give them, namely, HIPAA, Attorney Client Privilege, and Discoverability of Information.

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