Published in The Practical Litigator, Volume 18, No. 3, May 2007. Copyright © 2007 by the American Bar Association. Reprinted with permission.
Understanding your client’s dispute prevention and resolution experience and expertise can greatly increase the prospects for a successful settlement.
Jane Doe, Esq. Alpha Beta & Charlie, LLLC Re: ABC v.XYZ
I am very excited about working with you to resolve this dispute! As I mentioned when you were retained, it looks like this matter is headed for mediation. Because we have not yet worked together, I thought it would be helpful to pass on some of the lessons learned from our past mediation experience. This information is from our own observations and from discussions with other in-house and outside counsel and mediators. Of course, I look forward to an open dialogue and encourage you to get back to us with your thoughts and experiences as well.
For the most part, the mediation process has been good to us. However, this is not to say that there has not been some rough going along the way. Learning from our and other’s experiences and applying what works and what does not have helped increase the likelihood that we will achieve some measure of success through mediation.
The key question is, how can we maximize our chances for success?
To mediate or not to mediate, that is the question. How best to proceed from the onset?
As we contemplate whether or not to mediate, it is important to understand and discuss the principal dispute resolution alternatives. This is because an informed team must make key decisions regarding the best process for a particular dispute early on. To do so, outside counsel and their in-house counterparts must understand the process and the strengths and weaknesses of litigation, facilitation, mediation, and arbitration.
Fully involve us early on. We can provide critical information that can assist you in determining the best process for the dispute at hand and the best results. For instance, understanding our dispute resolution track record puts you in the best position to recommend how best to proceed. This is critical because it can save us both time and money!
Some related suggestions for you to think about:
- Carefully review and evaluate potential dispute outcomes with us as early as is practicable. This can help to foster the most realistic expectations and pave the way for settlement. For example, a likely outcome or probability analysis or jury verdict review may determine the most realistic negotiation strategy and best inform and support settlement options. Likewise, retaining a jury consultant to conduct focus groups for larger cases can provide the real world view of a matter that can be quite instructive to outside counsel and client alike. What looks like a “home run” on paper and in the eyes of an advocate can turn out to look quite different to a layperson. Let’s be sure to discuss these options!
- At the same time, be sure to acquaint us with all potential non-dollar specific mediation outcomes. For instance, identifying issues in dispute during mediation can lead to a reduction in the number of issues in dispute. This can be quite beneficial as time required and dollars spent can be reduced. Furthermore, identifying and reducing the number of issues can promote settlement at a later date. Another important non-dollar outcome can bring the parties together to repair their long term business relationship. Be sure to check with us to see if maintaining or strengthening our relationship is important for this matter.
- Please discuss with us whether a particular case should be mediated and when. Several important questions come to mind. Should the case be litigated because there is a precedent that is important to us? Will the other party or parties participate in good faith? Is the dollar value of the dispute worth the potential long-term litigation expense that we will incur over time? If you conclude a case should be mediated, when is it best to do so? For example, if we mediate now can we avoid expensive document discovery and time-consuming depositions? Do we need motions to be decided first? These are examples of factors that we want you to consider at this early stage.
So we decide to mediate, now what? Please Prepare! Prepare! Prepare!
Once we have decided to mediate, there are additional factors that we like to consider. Although some of what I am going to tell you might seem obvious, it is critical to us that you reflect on these issues so that we can discuss them.
Where should we mediate? Location is very important because it can set the climate and tone which enhances the potential for resolution. Ask yourself, is the location conducive to settlement? For example, conducting a mediation session in a law firm’s conference room can cause unnecessary and unneeded tension. Compare this to undertaking mediation in a private home overlooking a forest or large body of water. Correctly setting the tone is especially important when we hope to repair a relationship and work together cooperatively in the future. Why not start during our mediation session?
We need to spend some time determining who should be our mediator. We prefer a mediator who is persistent and available, trustworthy, familiar with the subject area, neutral, creative, and understands business relationships. Two important means of determining how a particular mediator fits into the above factors are polling your outside counsel colleagues and by our checking with other in-house counsel who have previously used the mediator.
Some additional thoughts that we ask you to keep in mind:
- Please be focused in your preparation. This will save us time and money. Let’s be sure to discuss your recommendations for your firm’s team and session participants, paying particular attention to the number of attendees including attorneys. When you consider this, ask yourself, what signal do you want to send and to whom? For example, the presence of a number of outside counsel and our CEO might display a level of concern that we do not wish or need to communicate. Plus, our CEO is very busy and therefore his time is at a premium. Of course, we always need to have authority at the table and to be flexible.
- Take the time to refine your case evaluation with us before the mediation session. What has occurred in the matter since the original evaluation? For example, a court decision’s arrival on the day of a session can affect our authority parameters positively or negatively.
- Consult us regarding our preferred relationship with the other parties. Do we need or want to continue to work together after resolution?
- Let’s be sure to carefully consider the content and tone of the briefing papers. For example, would a conciliatory approach work best with the mediator, the other parties, and us? The mediator is obviously a key audience, as is our client representative, the mediator, and the other party’s client representatives and outside counsel. This approach can foster communication between the parties, thus enhancing the potential for settlement.
- How much information do you want to relate to the other side? Telegraphing one’s case to the other side can point out our overall strategy that, should the case not settle, could have a detrimental impact on our case. Ask yourself whether it is likely that the case will settle at mediation. If it is unclear and you are concerned, please consider providing the mediator with a confidential “his or her eyes only” document if they will agree to accept it. Also give some thought to whether a dollar or other demand should be included in our papers. Does the mediator require it? If not, consider whether it could shut down the process.
- Experience has shown us that a clear, concise, organized, and less inflammatory presentation can be very effective. Remember, we have only so much time and our audience will likely have different levels of interest and understanding. As a suggestion, the norm should be clear, concise, and to the point, and more neutral than argumentative.
Also, please ask yourself:
- What level of participation do you need from the client representative during the mediation session? Remember, it is likely that the clients have not spoken for some time, and therefore this is a good time to consider our message from the company to the other parties and the mediator. For example, is a general apology without admitting liability something that we want to consider?
- How should information be presented during the opening stage or other parts of the mediation session? For example, should we use deposition video clips if we have them? One issue that we will need to consider is whether the statements or behavior of a deponent on video will embarrass any of the client representatives who are present.
- Should we address ground rules ahead of time? For example, will we permit the mediator to talk directly with us without you during the session? Are ex parte communications with the mediator going to be acceptable? Can we authorize the mediator to speak with the judge? We should discuss how we want to handle these and related issues well before the mediation session.
- As we prepare, let’s be sure to conduct a dry run before the session with our session team and consider the appropriate attire for attorneys and client representatives in advance.
- Last but not least, let’s minimize travel the evening before the session. Because it is likely to be a long day, we encourage all of our session team to arrive near the session location the day before so they will be well rested.
The Mediation Session
Preparation is also very important here. Below are some rules of thumb that we have found helpful over the years.
- If I am not at the session, please be sure to tell the client representative not to noticeably react if verbally attacked. They should endeavor to stay neutral. One useful tip is to consider having the client representatives for the parties actually sit together (as opposed to across the table from each other); this can help build empathy and discussion between the parties.
- Once again, carefully consider the tone of your presentation and its impact on your client, the other parties, and the mediator.
- Let’s also be optimistic. If we can, let’s pre-agree with the other parties about the form of a settlement agreement. It is time-efficient to bring an agreed-to form to the mediation session. This minimizes the potential for the need to seek court assistance to address drafting details.
There are no “templates” for success. However, if we consider your experience and the above points, I am sure that we will put ourselves in the best position for a successful session and outcome.
Below is a summary checklist for your use. It tracks the above-mentioned items with key points that we like to try to keep in mind. Of course, you are our settlement counsel so you can ignore Item #5! Please be sure to let me know if you have any suggestions or additions; I would be pleased to incorporate them.
Checklist – Key Considerations
- Work to prevent disputes. Keep little “d” disputes from becoming big “D” Disputes. Consider ADR agreements for transactions that outline the party’s preferences for negotiation, mediation, arbitration, other dispute resolution techniques, and related rules.
- Involve client from outset. Enlist the client in the process to pave the way for realistic expectations and eventual settlements.
- Complete and periodically update a case evaluation. Determine the realistic value of a settlement. Review probable outcomes and comparable jury award/settlement data and consider a focus group for large matters to test facts. Re-review periodically before the mediation session and update us on any significant changes.
- Carefully consider timing. Do we really need and want to conduct extensive discovery and motion practice? Is our adversary amenable to the mediation process?
- Choice of outside counsel. Gladiator or conciliator (or both)? Consider retaining settlement counsel who specialize in settling and not trying cases. They can often be very objective because they have less time and effort invested in a matter and have no pecuniary interest in taking a matter to trial. At the same time, separate settlement and trial counsel permits trial preparation and settlement efforts to continue on parallel tracks unimpeded and undistracted.
- Choice of mediator. Retain a persistent, trustworthy, knowledgeable, effective, and committed neutral.
- Keep the client up to speed. Communicate key case events to the client so he or she can be prepared for the session (and potentially be more amenable to your recommendations).
- Let’s choose the mediation team very carefully. Who do we need and want from the client? Which attorneys are really necessary? What kinds of signals do we want to send to the mediator and the parties? Bigwigs? Lots of firepower or one outside attorney and one client representative if we believe the other parties will try to fill the room?
- Location, location, location. How important is the ambiance of the session? Law firm conference room or private home?
- Authority. Always have someone present who has the necessary settlement authority.
- Presentation and papers. Carefully consider content, tone, and impact on session participants; do a full run-through.
- Agreement. Let’s try to get the parties to pre-agree on a form so we can make the most of any settlement momentum.
Jane, thanks very much for considering our input. I look forward to hearing your thoughts so that we can add them to our list. One thing is for sure; with our collective experience, we can do great things! Let’s get started today!
Sincerely, Pat Smith, General Counsel XYZ Corporation