Often, when an individual is tasked with making a decision, they tend to rely too heavily on an initial piece of information, referred to as the anchor. This predisposition is generally referred to as the anchoring effect. It is a cognitive bias that can significantly impact decision-making in a wide variety of situations, including in the courtroom. 

Plaintiff attorneys, in particular, have become adept at exploiting this psychological quirk to their advantage to secure financial outcomes that greatly benefit their clients. Based on the well-documented effectiveness of anchoring, plaintiff attorneys have become more assertive in requesting astronomical sums of money from juries. Yet, defense attorneys have been reluctant to counter this strategy with an alternative damages figure, often due to the fear that such a move could be interpreted as an admission of liability. However, research indicates a number of compelling reasons why mastering the counter-anchor should be a crucial part of a defense strategy. 

Why should a defense strategy include mastering the counter-anchor?

The plaintiff’s counsel will continue requesting exorbitant amounts, which will only increase if left unchallenged. When jurors struggle to determine fair compensation for plaintiffs (assuming they find for the plaintiff), the defense must present a strong counter-anchor and give jurors a grounded perspective on damages.

The Foundations of the Anchoring Effect

Amos Tversky and Daniel Kahneman first theorized the anchoring heuristic in their study ‘Judgment under Uncertainty: Heuristics and Biases.’ They stated, “In many situations, people make estimates by starting from an initial value that is adjusted to yield the final answer. The initial value, or starting point, may be suggested by the formulation of the problem, or it may be the result of a partial computation.” Later, they said, “Different starting points yield different estimates, which are biased toward the initial values. We call this phenomenon anchoring.” 

When observed in the legal setting, anchoring can greatly influence decision-making by the jury. Extensive research and numerous case studies have shown that when plaintiffs present exorbitant damages claims, juries tend to use these figures as anchor points for their own award decisions, leading to higher damage awards. The anchoring effect is a powerful and widely recognized psychological phenomenon, and it has become an effective tactic that plaintiffs consistently use to their advantage.

The idea that jurors will be so outraged by the plaintiff's request that they award significantly less or nothing is a risky bet for the defense. While jurors may view plaintiffs who request astronomical sums as "greedy" or "selfish," this perception rarely affects the final award. Research indicates that even jurors who initially find the plaintiff's request excessive eventually accept it as reasonable. While the excessive ask may have impacted the jurors’ perceptions of the plaintiff somewhat, jurors do not typically punish plaintiffs for excessive award requests, and any temporary negative perceptions are often ultimately inconsequential as the anchor worked as intended.

Strategic Counter-Anchoring is a Key Defense Tactic

Jurors often seek guidance when making damage awards. If the defense counsel delays addressing damages until the last minute (or not addressing damages at all), a juror's main reference point is the plaintiff's request, which can frequently lead to inflated damages. With this in mind, formulating a counter-anchor emerges as a critical defense strategy. 

The strategic solution is a proactive approach, implementing a counter-anchor strategy from the case's inception. By prioritizing damages early on, defense counsel can mitigate the risk of time-related limitations compromising the damages argument. By presenting reasonable alternatives to extreme awards and engaging jurors with a pragmatic mindset, defense attorneys aim to guide them toward realistic assessments of damages. The key is to present a counter-anchor that aligns with the case's facts and provides a logical rationale for the proposed figure.

While implementing this counter-anchoring strategy, defense attorneys should remember that arguing down damages without insulting the plaintiff requires finesse. Defense attorneys may strive to offer estimates for major damages categories and subtly highlight the generosity of their proposals. This nuanced approach seeks to align juror perceptions with grounded reasoning, fostering a realistic mindset that enhances the likelihood of achieving equitable outcomes.

The plaintiff's bar continually evolves, including and employing anchoring tactics to their advantage. To effectively defeat these tactics, counter-anchoring emerges as a powerful tool for the defense to guide jurors towards more realistic and equitable damage awards, ultimately achieving better outcomes for their clients. 

At Courtroom Sciences, our litigation research experts can assist in assessing your case and helping to maximize settlement and verdict outcomes with focus groups, mock trials, and jury consulting services. Speak with one of our experts to get started. 

Key Takeaways

●  The anchoring effect is a well-documented psychological phenomenon that influences decision-making.

●  Counter-anchoring involves presenting an alternative damages figure as part of the defense strategy, helping to guide jurors to more reasonable decisions about damages.

●  Contrary to popular belief, presenting an alternative damages figure is not typically interpreted as an admission of liability by jurors.

●  Mastering the counter-anchor is important to level the playing field and increase the likelihood of favorable outcomes for defendants.