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Is Toro smarter than everybody else? That’s the question our creative and industrious senior reporter Ashby Jones explores in “House Calls.” The Bloomington, Minnesota � based lawn products company says that by mid-2005 it will have saved $100 million, thanks to a policy of settling almost every product liability claim brought against it. In the ten years that the program has been in place, Toro says, fewer than two dozen claims have even made it to the discovery phase; all were dismissed on summary judgment motions. Jones spent a day in Bloomington meeting with the head of the program, the leading outside lawyer, and one of the paralegals featured on our cover (the other he interviewed by phone). They explained the program to him, and weren’t shy about revealing some of its unseemlier aspects. Typically, the company dispatches one of its paralegals to a victim’s home with weeks or days of hearing about a Toro-related accident. The paralegal will hug or even cry with the victim, and then write a check. If that doesn’t work, outside counsel Mike Olivella steps in. If the plaintiff spurns Olivella’s initial offer � often the sum of his medical expenses plus some pain-and-suffering compensation � the lawyer changes course. “I tell them that they’re never going to see a dime more than what we’ve just offered,” Olivella told Jones. It’s not always an elegant solution, but, according to Toro, it works. The company says that it has cut the cost of handling each claim it receives by some $80,000, from $115,000 to only $35,000 � a figure that includes lawyers’ fees, verdicts, and payouts. Why, then, have its rivals steered away from a mass settlement program for their product liability claims? Caterpillar GC James Buda tells Jones that the heavy equipment company has a message to send. “If you make products that you feel are well made and safe, your instinct is to stand behind them when others attack them,” Buda says. Cummins GC Marya Rose says that the claims against the engine manufacturer involve many defendants with complex fact patterns. “You can’t just run out and settle,” she argues. But a few corporations, including Johnson & Johnson, DuPont, Georgia-Pacific, and General Electric have adopted programs, that are, in part, based on the Toro model. For them, a “settlement-first” approach for many of their claims is a cheaper and faster resolution than litigation. Is the Toro way worth considering for your company? Robin Sparkman [email protected]

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