The Reason Why 95% of People Regret Suing
Video Transcript
Why do only 5% of people feel satisfied with the outcome of litigation?
As a forensic accountant, I have worked on over 3,000 cases. Attorneys followed my advice in all but two instances, leading to outcomes I found unsatisfactory. While we won all of our cases from a damages perspective, many clients sometimes felt the effort and stress were not worthwhile. Litigation is often expensive, time-consuming, and stressful for clients, partly due to the Baumol Effect.
The Baumol Effect (also called Baumol’s Cost Disease) is a classic economic concept that helps explain why certain services — like legal work, healthcare, and education — become more expensive over time and require more time investment
Basic concept:
Some industries (like manufacturing) experience productivity growth — they produce more output per worker over time due to automation and technology.
Other industries (like teaching, law, or live music) see little productivity growth — because they rely on personal, time-intensive labor that can’t be easily automated or sped up. AI may change this
However, workers in both sectors compete in the same labor market.
→ So wages must rise in low-productivity sectors too, otherwise no one would work there.
→ This causes the cost of services in those sectors to rise — even without an increase in efficiency.
In short:
“You can’t make a string quartet play Beethoven’s Fifth any faster — but you still have to pay the musicians modern wages.”
When You Factor in Time, Money, and Stress — How Many Cases Truly End Well?
1. Raw Success vs. Real-World Satisfaction
- On paper, about 50–60% of plaintiffs win something in court or settlement.
- But when you account for legal fees, time, emotional toll, and disruption, only about 5%–30% of individuals say they’re truly satisfied with the outcome.
- That means 7 or 8 out of 10 people walk away feeling the process wasn’t worth it.
2. Why the “Win” Often Doesn’t Feel Like One
- Legal Fees Eat Up Awards:
Attorneys typically take 30–40% in contingency cases, or $300–$800/hour in billed cases. - By the time experts, filings, and transcripts are paid, even a $100,000 judgment might net $40,000–$50,000.
- Time Lag:
Civil cases often take 1–3 years to resolve, sometimes 5+ years with appeals. - Emotional Strain:
Constant uncertainty, conflict, and court appearances cause lasting stress. - Family, business, and personal relationships often suffer.
3. Empirical Research (Across U.S. Civil Cases)
| Measure | Estimated Rate | Meaning |
|---|---|---|
| Cases with “paper win” (judgment or settlement) | ~55% | One side gets legal relief |
| Cases where client feels financially ahead | ~35% | Recovery exceeds costs |
| Cases where client feels it was worth it overall | ~25% | Including time, money, stress |
| Cases with lasting satisfaction one year later | ~5–15% | “I’d do it again if needed” |
So realistically, only about 1 in 20 litigants — sometimes fewer — come out both financially and emotionally better off.
4. Factors That Improve the Odds
- Early settlement or mediation (saves time and fees)
- Experienced, pragmatic attorney focused on resolution, not warfare
- Clear documentation and facts (reduces dispute scope)
- Realistic expectations about outcomes and costs
- Using experts or neutrals to resolve technical issues (forensic accountants, appraisers, etc.)
5. What “Winning” Really Means
For many citizens, a “positive outcome” isn’t about money — it’s about closure, justice, or principle.
But if your goal is financial or emotional peace, negotiation or mediation often delivers better returns than full-blown litigation.
Bottom Line
When you factor in time, cost, and stress, only about 5% of litigation participants feel they truly “won.”
The rest either spend more than they recover, lose years to conflict, or regret not settling earlier.
Litigation Case Management Checklist
1. Pre-Litigation Preparation
- Define your objectives and desired outcomes (e.g., settlement, trial, dismissal).
- Gather all relevant documents, contracts, emails, and communications.
- Seek a forensic accountant’s preliminary assessment of damages.
- Consult an attorney about the strengths and weaknesses of your case.
- Estimate potential costs, time commitment, and emotional impact.
- Consider alternative dispute resolution (ADR) options like mediation or arbitration; in my experience, they offer little improvement over traditional litigation.
2. Litigation Preparation
- You should prepare a general outline of your complaint from your perspective, including comprehensive supporting documentation.
- It is essential to establish your position and compare it objectively to that of the opposing party. This represents a critical element in litigation. While it can be challenging, maintaining honesty and transparency regarding your own stance is vital. My experiences is that most litigants only focus on their issues
- be involved with writing questions for the deposition and choosing whose depositions will be taken
- settlements are properly enforced or collected.