Steve Cozen Profile: The Inside Man

They had a ritual: Gittis and Cozen would have lunch together at the Locust Club along with a guy named Arthur Raynes, a personal-injury lawyer who had grown up above a grocery store in Yeadon and had played baseball and soccer for Duke. They were all still young, self-conscious about their humble roots, and prideful:

 
“You gotta meet my buddy Coze,” Gittis would say to some guy he’d just met in an elevator, “he’s the greatest fire-insurance lawyer in the history of the world!”

“Nah, nah,” Coze would reply, “you gotta meet my friend Gitty — he’s the greatest lawyer. … ”

And sure enough, Gittis went on to build Wolf Block into a major institution, and Raynes became one of the first lawyers to successfully sue a major pharmaceutical company, pressing the first case against the manufacturers of thalidomide. As for Cozen, he transformed the practice of insurance “subrogation” — which doesn’t sound like a big deal until you add up the billions.

 
The basic concept of subrogation isn’t complicated. Let’s say you own a GE stove, and one day the stove burns your house down. You go to your insurance company and make a claim, and you get a check for $500,000. The insurance company turns around and sues GE for the defective product. That’s subrogation. “But traditionally,” says Joe Gerber, a colleague of Cozen’s for 40 years, “those cases were resolved for five, 10, 15 cents on the dollar, maybe — maybe. Steve’s attitude was, ‘Wait a second. … If General Electric is responsible, why shouldn’t they pay $500,000?’”

 
Back then, most insurance companies wouldn’t bother to sue. The cases paid so little, and the costs were fixed — old-school insurance lawyers got paid by the hour whether they won the case or not. Until Cozen. Cozen worked the cases on contingency, like a personal-injury lawyer: We don’t get paid until YOU get paid!

He’d go in at the beginning and direct the whole case — hire experts, gather evidence. “He made a silk purse out of a sow’s ear,” says Gerber.

Gerber watched him do it up close. In the 1970s, Gerber and Cozen worked together on a case known as Gavlick Machinery. A machinery warehouse in Connecticut had burned down — lathes, punch presses — and somehow the two lawyers had to get a jury to care about a warehouse full of “used, greasy crap,” in Gerber’s phrase. It was brutal. They spent three and a half months in Hartford, living out of a two-bedroom hotel suite. Snowed nearly every day. Middle room was the workroom. Up at 7 a.m., asses in the chairs, preparing. “Prep, prep, prep,” says Gerber. Cozen was a tyrant of prep. He’d send papers back to Gerber with a hash of cursive felt-tip scribbles in a code of his own devising. At 10, they’d go to court and tell the jury a story about good Ma and Pa Gavlick, starting their company at their kitchen table, working hard, expanding and expanding and living the dream until, of course, “The sonsofbitches next door let their building catch fire.” And the jury would listen, and Cozen and Gerber would grab dinner and start working again by 7 p.m., until at midnight or 1 a.m. Gerber would conk out, and “I would say to him, ‘I’ve got to go to sleep now, Steve, or I’m gonna die,’” and Steve would look up from a stack of paper and say, oh, okay. And keep going. And then again the next day and the next day, until the jurors finally came back for the Gavlicks …