This page has articles on some more advanced mediation topics. I hope you find them thought provoking.
Mediation Styles
Much has been written about styles of mediation. Perhaps the two most common styles are "facilitative" and "evaluative." In the most general sense, a facilitative mediator serves as a host and attempts to stimulate negotiations between the parties without offering a view of the dispute. An evaluative mediator, on the other hand, is willing to offer views and feedback on the parties' positions.
I approach this issue from the perspective of having represented parties in commercial litigation for many years. Good lawyers can and do assist their clients in settling cases without mediation. My view is thus that a purely facilitative mediator does not bring much to the table in a commercial matter, as the lawyers would probably discuss settlement anyway. Based on conversations I have had with other commercial litigation attorneys across the country, this view seems to be widely shared. Lawyers often derisively refer to mediators who are only "note carriers," meaning that all they do is carry notes of settlement offers between the parties during the mediation.
Although I prefer an evaluative approach, that does not mean a particularly heavy handed approach. A good mediator has to be a good listener. A good mediator needs to have a thorough grasp of the facts and always needs to be open to hearing additional information, and making sure that the parties are fully informed. If a mediator expresses a strong view of a case to either side very early in the mediation, the mediator will not be viewed as neutral, and the party on the short end may elect not to participate further.On the other hand, at some point in the mediation, the mediator may need to offer very candid and direct feedback in order to move the parties toward settlement.
Often, the best approach to "reality testing" is to ask questions. Asking questions has the concomitant benefit of gathering information. If a party's damages case seems weak, a mediator might ask, initially: "I am not sure I fully understand your position on damages. Can you explain it to me in more detail?" The answer may prove that the damages case is stronger than initially thought, and that information (with the permission of the plaintiff) can be shared with the defendant. If the answer suggests, however, that the damages case is a little weak, a further question might be asked, "What do you expect the other side will argue against your damages case?" Later in the process, a more specific question might be asked, "Just to make sure I am not missing something, my understanding is that your damages are based on lost sales, and that your best case view of that is around $500,000?"
In the caucus in the other room, a similar dialogue takes place. That dialogue might begin with a question like this: "I understand that you do not think the other side has proven their damages. Do you think they have been damaged in any amount?" After that information is gathered, a further question might be, "Even though you think the damages are weak, do you think a jury might conclude they have some damages?" At the end of the day, hopefully the parties will be in a range where the case can settle.
I approach this issue from the perspective of having represented parties in commercial litigation for many years. Good lawyers can and do assist their clients in settling cases without mediation. My view is thus that a purely facilitative mediator does not bring much to the table in a commercial matter, as the lawyers would probably discuss settlement anyway. Based on conversations I have had with other commercial litigation attorneys across the country, this view seems to be widely shared. Lawyers often derisively refer to mediators who are only "note carriers," meaning that all they do is carry notes of settlement offers between the parties during the mediation.
Although I prefer an evaluative approach, that does not mean a particularly heavy handed approach. A good mediator has to be a good listener. A good mediator needs to have a thorough grasp of the facts and always needs to be open to hearing additional information, and making sure that the parties are fully informed. If a mediator expresses a strong view of a case to either side very early in the mediation, the mediator will not be viewed as neutral, and the party on the short end may elect not to participate further.On the other hand, at some point in the mediation, the mediator may need to offer very candid and direct feedback in order to move the parties toward settlement.
Often, the best approach to "reality testing" is to ask questions. Asking questions has the concomitant benefit of gathering information. If a party's damages case seems weak, a mediator might ask, initially: "I am not sure I fully understand your position on damages. Can you explain it to me in more detail?" The answer may prove that the damages case is stronger than initially thought, and that information (with the permission of the plaintiff) can be shared with the defendant. If the answer suggests, however, that the damages case is a little weak, a further question might be asked, "What do you expect the other side will argue against your damages case?" Later in the process, a more specific question might be asked, "Just to make sure I am not missing something, my understanding is that your damages are based on lost sales, and that your best case view of that is around $500,000?"
In the caucus in the other room, a similar dialogue takes place. That dialogue might begin with a question like this: "I understand that you do not think the other side has proven their damages. Do you think they have been damaged in any amount?" After that information is gathered, a further question might be, "Even though you think the damages are weak, do you think a jury might conclude they have some damages?" At the end of the day, hopefully the parties will be in a range where the case can settle.
Mediation for International Companies
When I spoke at an international legal conference in Heidelberg, Germany, in May 2003, many of the international participants were unfamiliar with mediation. To the international participants, "alternative dispute resolution" meant primarily international arbitration. International arbitration under the auspices of organizations such as the International Chamber of Commerce is a long-established mechanism for resolving disputes. However, international arbitration, like litigation, tends to be expensive and time consuming. Since 2003, things have changed. Mediation is now gaining popularity in Europe, for basically the same reasons it is popular in the U.S.
International companies doing business in the U.S. will almost surely want to consider mediation as a mechanism for resolving disputes that might arise in the U.S. As a general matter, the U.S. legal system is quite different from the civil law system used throughout Continental Europe. In Europe, broad discovery rights are not granted, the jury system is unknown, and punitive damages are generally not permitted. International companies thus may prefer alternatives to litigating in the U.S., and mediation is such an alternative.
European companies should consider utilizing multi-tiered dispute resolution provisions in their contracts which may require that, in the event of a dispute between the contracting parties, they must first mediate, and then resolve any remaining dispute through arbitration. Such an approach may be more acceptable to international companies than proceeding in the U.S. court system. Of course, many U.S. companies also favor such an approach.
International companies doing business in the U.S. will almost surely want to consider mediation as a mechanism for resolving disputes that might arise in the U.S. As a general matter, the U.S. legal system is quite different from the civil law system used throughout Continental Europe. In Europe, broad discovery rights are not granted, the jury system is unknown, and punitive damages are generally not permitted. International companies thus may prefer alternatives to litigating in the U.S., and mediation is such an alternative.
European companies should consider utilizing multi-tiered dispute resolution provisions in their contracts which may require that, in the event of a dispute between the contracting parties, they must first mediate, and then resolve any remaining dispute through arbitration. Such an approach may be more acceptable to international companies than proceeding in the U.S. court system. Of course, many U.S. companies also favor such an approach.
E-Discovery and Mediation
In December 2006, through some facially minor changes to the Federal Rules of Civil Procedure, “e-discovery” became a hot topic in civil litigation. “E-discovery” refers to mandated procedures applicable in federal lawsuits to consider and, if necessary, provide for the production of electronically stored information (“ESI”) during the discovery process. These procedures may require the production of emails, word processing documents, spreadsheets and other data maintained in an electronic form, and may require production of the information in an electronic form.
Dealing with e-discovery can be very expensive. E-discovery requires additional attention from counsel, and often requires hiring expensive discovery consultants. Not only is e-discovery expensive, it may be even more intrusive to businesses than the ordinary discovery process. Lawyers or consultants will need access to client’s IT systems. A client’s IT staff may be burdened with assisting with e-discovery rather than keeping computer systems up and running.
There is no way for businesses to avoid potential e-discovery issues. However, the burden can potentially be lessened by using mediation, particularly before a federal court lawsuit is filed, or shortly thereafter. Some lawyers will undoubtedly argue that mediation before discovery is complete (including e-discovery) is a waste of time, because the parties will not have the information necessary to settle. This is not necessarily the case.
Parties may choose to use mediation to establish an information exchange process that will allow the production, on a confidential basis, of the information they need to attempt to negotiate a settlement, but in a way that is mutually acceptable and within the control of the parties. In agreeing the the information exchange process, the parties can determine whether e-discovery is necessary, or whether a more traditional exchange of information will suffice.
After the information is exchanged, the parties can then hold a mediation session attempting to resolve their dispute on the merits. If anything, the the reality of possibly having to deal with additional discovery (including e-discovery) in the litigation may provide a powerful incentive for a negotiated resolution. In any event, if the parties are unable to settle in mediation and return to litigation, the information that was exchanged during mediation will at least eliminate some of the remaining discovery in the litigation. Therefore, the information exchange in mediation will not be a wasted effort regardless of whether the case settles or not.
Although the focus of this site is on mediation, the e-discovery rules may also be a boon to arbitration. The discovery process in arbitration has traditionally been less intrusive than litigation, although it does seem that more discovery has been allowed recently in arbitration proceedings.
Now more than ever, businesses may want to consider a multi-tiered dispute resolution process in their contracts. Such provisions require that disputes first be submitted to mediation, and, if mediation is unsuccessful, then to arbitration. The parties may wish to define the information exchange process in their dispute resolution provisions. Although the dispute resolution provisions will not be binding on third parties, they at least provide a mechanism for controlling the dispute resolution process between the contracting parties.
Dealing with e-discovery can be very expensive. E-discovery requires additional attention from counsel, and often requires hiring expensive discovery consultants. Not only is e-discovery expensive, it may be even more intrusive to businesses than the ordinary discovery process. Lawyers or consultants will need access to client’s IT systems. A client’s IT staff may be burdened with assisting with e-discovery rather than keeping computer systems up and running.
There is no way for businesses to avoid potential e-discovery issues. However, the burden can potentially be lessened by using mediation, particularly before a federal court lawsuit is filed, or shortly thereafter. Some lawyers will undoubtedly argue that mediation before discovery is complete (including e-discovery) is a waste of time, because the parties will not have the information necessary to settle. This is not necessarily the case.
Parties may choose to use mediation to establish an information exchange process that will allow the production, on a confidential basis, of the information they need to attempt to negotiate a settlement, but in a way that is mutually acceptable and within the control of the parties. In agreeing the the information exchange process, the parties can determine whether e-discovery is necessary, or whether a more traditional exchange of information will suffice.
After the information is exchanged, the parties can then hold a mediation session attempting to resolve their dispute on the merits. If anything, the the reality of possibly having to deal with additional discovery (including e-discovery) in the litigation may provide a powerful incentive for a negotiated resolution. In any event, if the parties are unable to settle in mediation and return to litigation, the information that was exchanged during mediation will at least eliminate some of the remaining discovery in the litigation. Therefore, the information exchange in mediation will not be a wasted effort regardless of whether the case settles or not.
Although the focus of this site is on mediation, the e-discovery rules may also be a boon to arbitration. The discovery process in arbitration has traditionally been less intrusive than litigation, although it does seem that more discovery has been allowed recently in arbitration proceedings.
Now more than ever, businesses may want to consider a multi-tiered dispute resolution process in their contracts. Such provisions require that disputes first be submitted to mediation, and, if mediation is unsuccessful, then to arbitration. The parties may wish to define the information exchange process in their dispute resolution provisions. Although the dispute resolution provisions will not be binding on third parties, they at least provide a mechanism for controlling the dispute resolution process between the contracting parties.
Should You "Show Your Cards" In Mediation?
Should you "show your cards" in mediation, and, if so, how many should you show? This question -- which essentially asks whether a party should reveal its strengths to the other party before or during the mediation - is often debated.
Some parties (and their lawyers) view mediation as an opportunity to learn about the other party's case, while wanting to hold their own cards close to the vest. If an opportunity to settle should happen to arise during mediation, these parties will consider it, but they above all want some "free discovery" and to keep their own secrets to themselves.
Although parties and their counsel of course must consider the facts and circumstances of their own case, they should carefully consider whether the "hold the cards" strategy is really viable and the possible consequences of using it. First, it is highly unlikely a party will ever be able to "hold the cards" until trial. The mandatory disclosure and discovery provisions of the Federal Rules of Civil Procedure, which govern litigation in the federal courts, are designed to require full disclosure. Most state court systems have similar rules. Even in arbitration, the trend is to require full disclosure, at least of documentary evidence. If a party fails to comply with disclosure and discovery requirements, the court or the arbitrators may preclude the use of the evidence which was not disclosed. In short, although a "smoking gun" sprung upon an unsuspecting party at trial makes for good television, it is not how things usually work in the real world.
Second, the "hold the cards" approach does not maximize the chances for a successful mediation. If there is crucial evidence of which the other party is unaware and remains unaware, the other party obviously will not factor that information into its settlement offer. The optimal time for mediation is when both parties have the information necessary to evaluate their position fully and completely. The "hold the cards" approach will, in most instances, undermine the chances for reaching a settlement in mediation.
Instead of holding your cards, consider showing them. There are a number of difficult cases I can recall that settled because one party was willing to lay out the fundamental strengths of its case to the other side. The practice of preparing a detailed "settlement package" is probably most prevalent in among the plaintiff's personal injury bar. The idea is to lay out the case and the damages in an organized way that demonstrates the seriousness of the case that will hopefully be reviewed by senior claims or management personnel of the defendant or its insurer and factored into a settlement offer. A properly prepared settlement package also sends the message that a party is prepared to go to trial if necessary, which can also increase the chances for a settlement.
Parties in commercial, construction, and insurance coverage cases should also consider a settlement package or perhaps a detailed settlement letter to opposing counsel. Sometimes, the other side just does not seem to acknowledge the problems they are facing. A settlement package or detailed settlement letter can sometimes break the logjam, or at least provide a means to get the dispute considered by other persons in the opposing party's organization who might see things differently. Plaintiffs are not the only parties who can benefit from showing their cards. If the defense is strong, laying out the fundamentals may cause the plaintiff to reconsider its demand.
There may be circumstances in which showing your cards is not the right strategy. However, in most cases, getting your party's strengths on the table will maximize the chances for settling the case, and settling the case on favorable terms. Save the bluffing for your next card game.
Some parties (and their lawyers) view mediation as an opportunity to learn about the other party's case, while wanting to hold their own cards close to the vest. If an opportunity to settle should happen to arise during mediation, these parties will consider it, but they above all want some "free discovery" and to keep their own secrets to themselves.
Although parties and their counsel of course must consider the facts and circumstances of their own case, they should carefully consider whether the "hold the cards" strategy is really viable and the possible consequences of using it. First, it is highly unlikely a party will ever be able to "hold the cards" until trial. The mandatory disclosure and discovery provisions of the Federal Rules of Civil Procedure, which govern litigation in the federal courts, are designed to require full disclosure. Most state court systems have similar rules. Even in arbitration, the trend is to require full disclosure, at least of documentary evidence. If a party fails to comply with disclosure and discovery requirements, the court or the arbitrators may preclude the use of the evidence which was not disclosed. In short, although a "smoking gun" sprung upon an unsuspecting party at trial makes for good television, it is not how things usually work in the real world.
Second, the "hold the cards" approach does not maximize the chances for a successful mediation. If there is crucial evidence of which the other party is unaware and remains unaware, the other party obviously will not factor that information into its settlement offer. The optimal time for mediation is when both parties have the information necessary to evaluate their position fully and completely. The "hold the cards" approach will, in most instances, undermine the chances for reaching a settlement in mediation.
Instead of holding your cards, consider showing them. There are a number of difficult cases I can recall that settled because one party was willing to lay out the fundamental strengths of its case to the other side. The practice of preparing a detailed "settlement package" is probably most prevalent in among the plaintiff's personal injury bar. The idea is to lay out the case and the damages in an organized way that demonstrates the seriousness of the case that will hopefully be reviewed by senior claims or management personnel of the defendant or its insurer and factored into a settlement offer. A properly prepared settlement package also sends the message that a party is prepared to go to trial if necessary, which can also increase the chances for a settlement.
Parties in commercial, construction, and insurance coverage cases should also consider a settlement package or perhaps a detailed settlement letter to opposing counsel. Sometimes, the other side just does not seem to acknowledge the problems they are facing. A settlement package or detailed settlement letter can sometimes break the logjam, or at least provide a means to get the dispute considered by other persons in the opposing party's organization who might see things differently. Plaintiffs are not the only parties who can benefit from showing their cards. If the defense is strong, laying out the fundamentals may cause the plaintiff to reconsider its demand.
There may be circumstances in which showing your cards is not the right strategy. However, in most cases, getting your party's strengths on the table will maximize the chances for settling the case, and settling the case on favorable terms. Save the bluffing for your next card game.
Advocacy In Mediation
Many lawyers have represented parties in mediation. However, surprisingly few are really good at it. The most common reason is that many lawyers approach mediation just as they approach litigation: They view themselves as there to prove a point, to never give an inch, and somehow to "win" the mediation. Many lawyers compound these preconceptions by being poor listeners and lacking creativity in formulating settlements.
Mediation is different from litigation: A "win" in mediation is not beating the other side; it is achieving the best possible settlement for the client. The mediator is not present to decide anything. The process of mediation, just like any negotiation, inherently involves give and take, and a settlement is not going to be possible if one side seeks only "take" without any "give."
That is not to say that an advocate in mediation should not forcefully represent the client's position. On the contrary, particularly in the opening session, a lawyer in mediation should stress all of the strong points of the client's position and the weak points of the opponent's position. This should be done, however, in the context of understanding that the goal is reaching a settlement.
As an advocate in mediation, it is often appropriate to acknowledge what cannot be denied. For example, a lawyer may be representing a manufacturer in a product liability suit in which the plaintiff has been severely injured. The manufacturer's position may be based on simple causation: The real cause of the accident was the other driver's reckless conduct, not any defect in the manufacturer's product. Of course, these points should be made. However, it may well be appropriate to acknowledge with sincerity that the plaintiff was severely injured and to express regret that the accident happened, although not due to the fault of the manufacturer. Such an acknowledgment in no way undermines the manufacturer's position, but it is a humane and thoughtful gesture that may also assist in resolving the case.
Because mediation is confidential, there will likely be a time - often during a caucus - in which the candid bottom line evaluation of the case should be discussed. Such a discussion is often the final step toward getting into a settlement range that will resolve the case.
Mediation advocates should be creative. In business cases in particular, there may be a "win/win" outcome that is possible. Obviously, such solutions are among the easiest for a mediator to "sell" to the other side. Good mediators may also suggest creative solutions that have not been previously considered. Mediation advocates need to be open to such approaches.
Lawyers acting as advocates in mediation should make sure their clients know the purpose of mediation before it begins. Clients should know that the goal is to reach an acceptable settlement and that the lawyer's job is to try to help broker the best possible settlement, and that the approach in mediation will be different than the approach at trial if the case does not settle.
Mediation is different from litigation: A "win" in mediation is not beating the other side; it is achieving the best possible settlement for the client. The mediator is not present to decide anything. The process of mediation, just like any negotiation, inherently involves give and take, and a settlement is not going to be possible if one side seeks only "take" without any "give."
That is not to say that an advocate in mediation should not forcefully represent the client's position. On the contrary, particularly in the opening session, a lawyer in mediation should stress all of the strong points of the client's position and the weak points of the opponent's position. This should be done, however, in the context of understanding that the goal is reaching a settlement.
As an advocate in mediation, it is often appropriate to acknowledge what cannot be denied. For example, a lawyer may be representing a manufacturer in a product liability suit in which the plaintiff has been severely injured. The manufacturer's position may be based on simple causation: The real cause of the accident was the other driver's reckless conduct, not any defect in the manufacturer's product. Of course, these points should be made. However, it may well be appropriate to acknowledge with sincerity that the plaintiff was severely injured and to express regret that the accident happened, although not due to the fault of the manufacturer. Such an acknowledgment in no way undermines the manufacturer's position, but it is a humane and thoughtful gesture that may also assist in resolving the case.
Because mediation is confidential, there will likely be a time - often during a caucus - in which the candid bottom line evaluation of the case should be discussed. Such a discussion is often the final step toward getting into a settlement range that will resolve the case.
Mediation advocates should be creative. In business cases in particular, there may be a "win/win" outcome that is possible. Obviously, such solutions are among the easiest for a mediator to "sell" to the other side. Good mediators may also suggest creative solutions that have not been previously considered. Mediation advocates need to be open to such approaches.
Lawyers acting as advocates in mediation should make sure their clients know the purpose of mediation before it begins. Clients should know that the goal is to reach an acceptable settlement and that the lawyer's job is to try to help broker the best possible settlement, and that the approach in mediation will be different than the approach at trial if the case does not settle.
