A sample legal checklist

When I wrote about the power of checklists a few months ago, I wanted to give an example illustrating how useful legal checklists can be.  But at that time, all the examples I had were proprietary checklists that could not be shared outside our client firms.

For the second edition of my Legal Project Management Quick Reference Guide, I’ve gotten permission to reproduce one of the copyrighted checklists sold by the Practical Law Company in their subscription service for Corporate and Securities attorneys.  (In case you are wondering, I don’t make any money from these. I just like them.)

I chose their “Private mergers and acquisitions due diligence checklist” for my book. The second edition includes the full 13 page version, but for today’s sample I am reproducing just the sub-section on due diligence for litigation:

It is important to understand the type of litigation the target is involved in and the nature of any pending claims. Often it is difficult to get a full picture of the target’s litigation from the documents alone. It is a good idea to schedule a conference call with the management of the target for a comprehensive review. The following is a list of common issues and questions to answer in your due diligence review of the target’s litigation.

• How many claims are currently pending?


• Do you have sufficient information on all pending claims?


• Do you need to have a litigator review any of the materials?


• Are the pending claims covered by insurance? If so, what is the deductible?


• What is the estimate of damages?


• What is the current status of each claim?


• What is the likelihood of success on the merits?


• Were there any large claims paid out in the past?


• Are any of the pending claims class actions?  Has the target been involved in any class actions in the past?


• What kind of claims or litigation is the target business typically a party to?


• What is the average amount of damages?


• Are most claims settled or litigated?


• What is the typical size of a settlement?


• Are there any settlement agreements or court decrees with ongoing obligations? If so, what are they and when do they terminate?

Many of these items seem straightforward.  But, like the checklist a Boeing 727 pilot reviews before taking off, a legal checklist can be a powerful reminder not to skip any steps.

 

This post is based on the second edition of the Legal Project Management Quick Reference Guide.  A formal announcement regarding the second edition will appear in this blog soon.