An Analysis of “The Wal-Mart Lawsuit against Debbie Shank”

An Analysis of “The Wal-Mart Lawsuit against Debbie Shank”


Do people really comprehend the legal status of subrogation, a circumstances in which an insurance company tries to recoup expenses for a claim it has paid out? Fewer years ago, auto collision had left a former Wal-Mart employee Debbie Shank permanently brain-damaged and in the wheelchair. Debbie Shank’s Health Care Insurance (Wal-Mart) had successfully paid out about $470,000 for Shank's medical expenses. Shortly after the auto accident, Shank family’s was awarded $1 million in a lawsuit against the truck company/driver. Less than $500,000 was deposit in a trust to cover Debbie Shank's long-term care in nursing home, after legal fees and related expenses were paid out. Unfortunately, Debbie Shank’s Health Care Insurance (Wal-Mart) who had paid for Shank's medical expenses, later sued for the same amount because the Wal-Mart's health plan policy entitle Corporation the right to recoup medical expenses if an employee collects damages in a lawsuit from third party. Sadly, Debbie Shank lost lawsuit to Wal-Mart. In this essay, I will Use Galanter’s article, Why the “Haves” Come Out Ahead: Speculations on the Limits of Legal Change to examine the Wal-Mart lawsuit against Debbie Shank in the view of parties as one-shotter/repeat player, the advantages/disadvantages of each party, the interests of each party in this lawsuit, and how the balance of power between Wal-Mart Corporation and Debbie Shank influence the outcome of litigation.

Galanter’s article clearly highlights ligation procedures in term of defining which party is one-shotter (OS) and which party is repeat player (RP). Parties are divided into those who have only occasional employ the judicial process (one-shotters) and those who are engaged in much similar litigation over time (repeat players). One-shotters are the criminal accused, divorce case, or an automobile accident. Repeat players, on the other hand, are insurance companies, landlords, finance company, etc. The Wal-Mart lawsuit against Debbie Shank is litigation between one-shotter (OS) and repeat player (RP). Debbie Shank is a one-shotter in this litigation due to the follow reasons; 1st Debbie Shank is a defendant who has only occasional recourse to the court. Debbie Shank has never had, never anticipate having, and never engage in similar litigation. 2nd Debbie Shank is an individual and her stakes in this lawsuit is higher in relative to the total worth. Debbie Shank is not representing any Corporation, but herself as an individual with higher interest in winning this lawsuit. According to Galanter, “An OS, on the hand, is a unit whose claims are too large (relative to his size) or too small (relative to the cost of remedies) to be managed routinely and rationally”. As a one-shotter, Debbie Shank’s claim is too large to be managed routinely and reasonably. The Wal-Mart lawsuit against Debbie Shank is an extraordinary case that deserves exploration of health plan policy and justification of legal laws to protect vulnerable citizens. Wal-Mart Corporation, on the other hand, is a repeat player who has been engaged in much similar litigation over time. The Corporation has had, anticipates having, and repeated the same litigation over time. As insurance company, the Corporation has had similar ligation in the past, anticipating similar ligation in the future, and will repeated similar ligation. The Wal-Mart Corporation is a larger unit and the stakes in its lawsuit against Debbie Shank are smaller in relative to total worth. The Corporation has invested and will continue to invest great amount of resources in this case for the sake of winning the lawsuit at all cost. This lawsuit is not all about the money the Corporation had paid for Debbie Shank’s medical expense, the lawsuit is all about pursuing the Corporation’s long term interest. Wal-Mart is determined to ensure that all the employees are endured to health plan policy and its clause, which entitles the Corporation the right to recoup medical expense if the employee collects damage from party. As a repeat player, Wal-Mart has great advantages in contrast to Debbie Shank (one-shotter).

Galanter’s article, why the “Haves” Come out Ahead: Speculations on the Limits of Legal Change; highlighted some advantage and disadvantage of one-shotter (OS) and repeat player (RP). Wal-Mart Corporation, as a repeat player, has greater advantaged over Debbie Shank the one-shotter. Wal-Mart (RP) has advantages in structuring transaction, specializing expertise, developing long-term strategy, playing for rules, bargaining credibility, investing in penetration. In Wal-Mart lawsuit against Debbie Shank, the Corporation has advantaged in transaction structure, because the Corporation has done it before and it has advance intelligence. One of the Wal-Mart's fundamental advantages lies in her ability to structure policies, reorganize transactions, as well as structuring the business entities/organizations that are used to effect particular transaction. Debbie Shank, on the other hand, has no ability to structure transaction because she is a former employee of Wal-Mart with no resources. As a successful Corporation, Wal-Mart has advantage in specializing expertise, accessing specialists, and developing a long-term strategy to maximize their profit over a long series of cases. Wal-Mart as repeat player has established and maintained bargaining credibility as a competitor. Debbie Shank has more difficulty in committing herself in bargaining because she has no bargaining reputation to sustain. Wal-Mart Corporation has ability to expend its resources in order to influence the creation of relevant rules by lobbying. As a Corporation, Wal-Mart has the resources to hire lobbying firm who will influence Politicians to adapt certain policies. Due to lack of resources and being a one-shotter, Debbie Shank is not capable to hire lobbying firm because Debbie Shank has never anticipates having or repeated similar litigation over time. Lastly, Wal-Mart Corporation has advantaged in the investment of penetration. The Corporation is able to invest in matching resources necessary to secure the penetration of rules favorable to its business.

In contrast, Debbie Shank has no advantages in Wal-Mart lawsuit due to lack of resources, funds, experiences, skills, etc. Debbie Shank as an individual has no advantages over a successful Wal-Mart, a Corporation who generates billions of dollars annually. Debbie Shank is incapable to structured transaction, specialized expertise, and generated wealth, developed long-term strategy, played for rules, bargained credibility, and invested in penetration. Being unable to invest in these kinds of resources has restrained Debbie Shank’s advantages in winning Wal-Mart lawsuit. According to Galanter’s article, Corporation like Wal-Mart is described as “haves” in terms of power, wealth, and status; while, an individual like Debbie Shank is described as “have-nots”. It is reasonable to say that those who have power and wealth have greater advantage over those who don’t have. In overall, Wal-Mart Corporation has greater advantages in its lawsuit against Debbie Shank.

As a matter fact, Wal-Mart Corporation is very interested in its lawsuit against Debbie Shank because the Corporation has advantages in this litigation. As a repeat player, the Corporation has done it before, has advance intelligence, and written the contract. The combination of wealth, power, and status has given Wal-Mart upper hand in this ligation. Having greater advantages in this case has encouraged Wal-Mart Corporation to defend its lawsuit against Debbie Shank, the defendant. Wal-Mart Corporation has upper hand in advance intelligence, wealth, expertise, contract, and access to specialist such as lawyers, lobby, or interest group. It is in the interest of Wal-Mart Corporation to maximize its profit through the implantation of contracts. Marc Galander, “For the RP, on the other hand, anything that will favorably influence the outcomes of future cases is a worthwhile result”. Clearly, Wal-Mart Corporation is very interested in its lawsuit against Debbie Shank because this case will influence the outcomes of future cases. Thus, Wal-Mart Corporation support anything that will favorably impact the outcomes of future litigation is worthwhile.

On the other hand, Debbie Shank is not interested in the Wal-Mart Corporation’s lawsuit because the defendant has no advantage in this ligation. To begin with, Debbie Shank doesn’t have advance intelligence, expertise, and access to specialist, money, and other resources to defend this lawsuit. Without resources, Debbie Shank’s chance of winning this ligation is very slim. Debbie Shank’s interest in this ligation is very low because she signed the Wal-Mart’s health plan policy, a legal contract which entitles Wal-Mart the right to recoup medical expense if the employee collects damage from party. According to CNN, “the Shanks didn’t notice in the fine print of Wal-Mart’s health plan policy that the company has the right to recoup medical expenses if an employee collects damages in a lawsuit”. Clearly, the Wal-Mart’s health plan policy entitles the company the right to recoup Medical expense in Debbie Shank’s case because it is a legal contract. In addition, the balance of power between Wal-Mart Corporation and Debbie Shank has greater influence in the outcome of this lawsuit.

(4) How the balance of power between the parties impacted the outcome(s) of this lawsuit.

In Wal-Mart’s lawsuit against Debbie Shank, the Corporation has greater power in contrast to Debbie Shank. Wal-Mart as the world’s largest retail store has the power to draft the constitution and policies that will governor and protect the operation of Corporation. Wal-Mart (repeat player) has greater power over Debbie Shank (one-shotter) in term of resources and rules. Resources do play an important role in the outcome of ligation especially in Wal-Mart’s lawsuit against Debbie Shank. And Wal-Mart the repeat player has access to resources that are not available to Debbie Shank the one-shotter. Galanter states, “Not only would the RP get more talent to begin with, but he would on the whole get greater continuity, better record-keeping, more anticipatory or preventive work, more experience and specialized skill in pertinent areas, and more control over counsel” Wal-Mart has the funds to invest in preventive measure and specialize skill in pertinent areas, or lobby for particular policy to preserve the Corporation’s interest. This is something Debbie Shank (one-shotter) isn’t capable to achieve without resources. Having and not having do justify the balance of power between parties and it impacted the outcome of the lawsuit.

The nature of U.S. legal institutions, on the other hand, tent to increase the power of repeat player like Wal-Mart Corporation. “Most U.S. legal institutions are also characterized by overload that inevitably affects the balance of advantages and favors those with resources. Overload often leads to delay, which is time consuming and discounts the value--or likelihood--of recovery”. A lawsuit must have the resources to keep the case alive. However, the U.S. legal institutions which are viewed as a progressive method of dispute resolution often reinforce the power of the Corporation who draft the constitution of a contract. Contract has been used by Corporations as the mean to protect their interest. For example, Debbie Shank lost litigation to Wal-Mart because she had signed a the Wal-Mart’s health plan policy, a legal contract which gives Corporation the right to recoup medical expenses if an employee collects damages in a lawsuit. This kind of policy demonstrates the balance of power between Wal-Mart (repeat player) and Debbie Shank (one-shotter).

In conclusion, Galanter’s article, Why the “Haves” Come Out Ahead: Speculations on the Limits of Legal Change highlights significant procedures in U.S. legal institution. These litigation procedures stress to classify/identifying the differences between parties (plaintiff and defendant) in the follow terms. 1st the essay distinguish between of one-shotter/repeat player, the advantages/disadvantages of each party, the interests of the parties in lawsuit, and how the balance of power between one-shotter and repeat player influence the outcome of litigation. Debbie Shank as one-shotter have only occasional employ the judicial process; while Wal-Mart Corporation as repeat player has been engaged in the same litigation over time.

Title: Why the "Haves" Come out Ahead: Speculations on the Limits of Legal Change

Author(s): Marc Galanter

Source: Law & Society Review, Vol. 9, No. 1, Litigation and Dispute Processing: Part One (Autumn, 1974), pp. 95-160

Publisher(s): Blackwell Publishing on behalf of the Law and Society Association

Stable URL: http://www.jstor.org/stable/3053023