Decision Analysis, Litigation Risk Assessments and Decision Trees – The Theoretical Framework

Eperoto’s software relies on a theoretical framework often referred to as “Decision Analysis”, “Decision Theory”, “Litigation Risk Assessment,” and sometimes “Decision tree modeling”. On this continuously updated page, we will share what we hope will become a comprehensive reading list of books, articles, and other materials covering this topic from a dispute resolution perspective. If there is a particular article that you are having trouble obtaining, let us know and perhaps we can help you find it (many of them are for free available online).

Some of the books and articles below are written for readers with little or no experience in relying on quantitative models of legal disputes, while other articles are very in-depth. A word of advice: Starting with decision analysis in its simplest form is often best.

Everything should be made as simple as possible, but not simpler.

Albert Einstein

Not Data or AI-based

To avoid confusion: The following list of books and articles concerns assessments and models created with input from the user – and should not be confused with AI-models or “Big-data” models for evaluating cases – even though the input provided in the models can be based on such information.

Books with a Focus on Decision Analysis in Dispute Resolution

There are quite a few books and articles covering the topic of decision analysis in general (see some of them in a list further down). There are however not that many books focusing specifically on decision analysis or litigation risk assessment in a legal context. This first list highlights such books, with a few short comments on their content and their author(s).

Winning at Litigation through Decision Analysis by John Celona

John Celona’s book, the first covering decision analysis in a legal perspective, provides an invaluable understanding of decision analysis inside a legal framework. Filled with insightful examples and practical exercises, this resource serves as an excellent introduction, equipping legal professionals with a comprehensive understanding of risk analysis in the realm of dispute resolution.

John Celona is a Stanford affiliated academic and lawyer, who has many years of experience from applying decision analysis in dispute resolution.

Do not miss the three videos Eperoto has created together with John Celona.

Litigation Interest and Risk Assessment: Help Your Clients Make Good Litigation Decisions by Michaela Keet, Heather Heavin, and John Lande

Years of research, academic articles, and practical experience by Professors Michaela Keet and Heather Heavin, combined with insights from American lawyer John Lande is here fused into a methodology they’ve named LIRA (Litigation Interest and Risk Assessment). 

Published by the American Bar Association, this book provides a well-written approach and understanding of how to perform a thorough analysis by relying on a structured, quantitative analysis.

Risk & Rigor: A Lawyer’s Guide to Decision Trees for Assessing Cases and Advising Clients by Marjorie Corman Aaron

Ohio-based scholar, lawyer and mediator Marjorie Corman Aaron has written and published this book – a result of years of studies and articles on the topic. Available online for free, you will find several practical examples. A great way to get a research-based and practical view on litigation risk assessment.

Books Focusing on Decision Analysis in General

The early published books covering decision analysis do not have a specific legal focus, but are still valuable for the lawyer who is interested in diving deeper into the methods and tools of the trade, and they often contain examples from a dispute resolution setting.

Decision Analysis for the Professional by John Celona and Peter McNamee

This fourth edition book is a key resource for understanding how to make informed decisions in uncertain scenarios, and contains examples on making decisions around the development of new business strategies or launching new products, and covers topics such as sensitivity analysis, which can be relevant for high-value disputes.

The book is available for free in PDF format here

Books in Languages other than English

Below follows a list of books written in languages other than English. If you know of any more books covering this topic, don’t hesitate to reach out and let us know.

Prozessrisikoanalyse Erfolgsaussichten vor Gericht bestimmen, by Jörg Risse (German)

Probably the only comprehensive book on the topic in German.

Avtals- och tvistlösningsförhandling, by Eric M. Runesson (Swedish)

Written by lawyer, Supreme court judge, and member of the Swedish Academy and Nobel Committee for literature Eric M. Runesson, this book provides a great understanding and practical examples on strategies that can be applied in dispute resolution negotiations. The book also covers quantitative analysis in the context of Swedish law.

Academic Articles and Practical Guides

Many academic and practical articles have been written covering the topic of decision analysis in law. As evident from the list below, the subject has been covered especially thoroughly by Michaela Keet and Heather Heavin from the University of Saskatchewan and Marjorie Aaron from the University of Cincinnati. Especially worth mentioning are the many articles written by Marc B. Victor, who’s earliest article on the subject was published, 1984. The title of that article basically says what decision analysis in litigation is all about: “How much is a case worth?”

Title	Author/Editor	Year	Source/Publisher	Short Comment(s)
Effective Conflict Management	ICC Commission on arbitration and ADR	2023	ICC	This is a guide published by ICC’s on mediation and ADR, and includes a detailed section on quantitative assessment methods inspired by an article written by Ulrich Hagel. Starting from page 43, the reports walks through the components needed to assess a dispute by relying on a quantitative assessment, and also contains a visual model that can be used for translating qualitative assessments into numerical values.
The Value Add of Legal Departments in Disputes: Making a Business Case Rather Than Providing Pure Legal Advice	Ulrich Hagel	2016	Can be found in: “Liquid Legal: Transforming Legal into a Business Savvy, Information Enabled and Performance Driven Industry,” 2016, p. 237–273	This article shows how a lawyer can approach a dispute not as a problem, but instead as a potential investment. Is it worth investing in the potential upside as a claimant, or spend legal fees to hedge against a potential exposure? Read to find out more.
A Spectrum of Tools to Support Litigation Risk Assessment: Promise and Limitations	Heather Heavin and Michaela Keet	2017	Canadian Journal of Law and Technology	Heavin and Keet, working from Saskatchewa, Canada together have years of academic research and practical use of decision analysis and litigation risk assessments. This article gives a good understanding of both those sides.
Beyond Decision Trees: Determining Aggregate Probabilities of Time, Cost, and Outcomes	Paul Prestia and Harrie Samaras	2010	Alternatives to the High Cost of Litigation – Newsletter	Contains a very in depth description of how a decision maker can rely on decision tree modeling and also factoring in variables such as time, internal costs, etc., to get a more in depth understanding of complex disputes.
Decision Analysis as a Mediator’s Tool	David P. Hoffer	1996	Harvard Negotiation Law Review	Contains an example a sexual harassment case, how to build a decision tree of the case, and how such a financial decision tree model can be used in connection with other more soft or human factors that must be addressed when addressing such a case as a mediator.
Decision Analysis: Decision Analysis in Negotiation	Jeffrey M. Senger	1991	Marquette Law Review	A short and quick article that effectively describes how to address and assess a dispute by relying on decision tree models.
Interpreting A Decision Tree Analysis Of A Lawsuit	Marc B. Victor	–	–	This well-written articles covers how one can rely on decision analysis 1. To give other counsel and the client a clearer understanding of the key issues, uncertainties and exposure presented by a case; 2. To gain settlement authority from the client; 3. To convince the other side to accept a given settlement; 4. To persuade a mediator or settlement conference judge of the rationale of your position; 5. To plan a cost-effective litigation strategy. And then proceeds to explain how this can be done in practice.
Evaluating Legal Risks and Costs with Decision Tree Analysis	Marc B. Victor and GC and VC of General Motors	2000	Successful Partnering Between Inside and Outside Counsel (Robert L. Haig ed.)	–
The Proper Use of Decision Analysis to Assist Litigation Strategy	Marc B. Victor	1985	The Business Lawyer, Vol. 40, No. 2 (February 1985), pp. 617-629	Demonstrates the pitfalls of a decision analysis model that has not been constructed properly, and provides advice around how to best model the several factors involved with a complex dispute.
The Value of Decision Analysis in Mediation Practice	Marjorie Corman Aaron	1995	Negotiation Journal – Wiley Online Library	Contains a discussion on the different methods and challenges for mediators when conveying their understanding of the case, and the benefits of relying on a decision analysis methodology to retain a neutral status.
Decision Tree Analysis: A Means of Reducing Litigation Uncertainty and Facilitating Good Settlements	Marc B. Victor	2015	Georgia State Law Review	Contains an efficient description of decision analysis modeling, and how to model claims with one or several factors required to win.
The Role of Risk Analysis in Dispute and Litigation Management	Marc B. Victor, Robert B. Calahan, John R. Dent	2004	American Bar Association	The article contains a very on-point comparison of how lawyers often value risky disputes and how businesses evaluate risky ventures. This is followed by a very in depth step-by-step approach of how to model a case by relying on decision analysis.
Litigation Risk Analysis: Using Rigorous Projections to Encourage and Inform Settlement	Heather Heavin and Michaela Keet	2017	–	Following an introduction to decision tree models, this article contains a very useful and in depth checklist for the factors required to assess a case by relying on decision tree models.
Using decision trees analysis to intelligently manage litigation	Rowena Borenstein, Brian R. Daley, Edward W. Murray, Jeffrey W. Rennecker	2008	Association of Corporate Counsel	Contains a PowerPoint presentation, as well as material for how to structure an assessment revolving around an IP dispute.
Shaking Decision Trees for Risks and Rewards	Marjorie Corman Aaron	2015	Dispute Resolution Magazine	Put in the clients’ words, “Of all the ways this case could play out, what’s most likely to happen? What are my overall chances of getting nothing? Of winning enough to cover my losses? Of getting socked with a verdict that will bankrupt my business?” This article explains how to map out questions like these by relying on a decision tree structure.
Beyond Grey Hair and Gut Instincts: Using Decision Trees to Supplement Analysis in Litigation	Simon Burnett, Balance Legal capital	2016	International Corporate Rescue	Provides an intro to decision tree analysis, an assessment of a IP-litigation case, and how this case’s risk profile varies with or without external funding.
The Jury Algorithm: How to Simulate a Jury, Whether We Can Do So & Why We Should Care	Stanley Santire	–	–	Contains a decision tree type flow chart of how to assess a case revolving around a sexual harassment case, to be tried by a Jury.
Risk Evaluation in Intellectual Property Litigation	Marc Victor	2002	Intellectual Property Counseling and Litigation	–
Applying Decision Analysis to Human Factors in Decision Making at Stanford University Medical Center	John Celona	2017	Advances in Human Factors, Business Management, Training and Education, pages 433–445, Publisher: Springer.	How do you rely on decision analysis to effectively assess a group of complex disputes revolving around potential medical malpractice, and how do you set correct reserves for such a portfolio? Read more to find out how Decision analysis can be used from the perspective of an insurer.