Just as in litigating cases, preparation is a key driver of a successful mediation outcome.
I generally have an early call with counsel for all parties to learn generally about the case and its status, go over my suggested approaches to the particular mediation, and any variants that might be suggested by counsel, set dates for submissions and the mediation session(s) and then obtain copies of the pleadings and any important decisions in the case. I almost always request that Mediation Statements prepared by each side be exchanged by the parties as well as submitted to me, along with copies of any key documents, approximately ten days before the Mediation, with any additional points or documents that a party wants to provide confidentially only to the Mediator submitted solely to me.
I often email each party's counsel on a confidential basis a small number of questions just for that party raised by my review of the Mediation Statements and related materials that I ask that counsel answer confidentially in an email sent solely to me. Shortly before the first mediation session, I hold a pre-mediation conference call separately with each party/side (counsel and often party representative) to go over questions, issues or concerns that the parties or I may have as well as to present a proposed game plan for the mediation session(s) based on what I have learned so far. Often, these calls will include beginnings of discussions of potential avenues for resolution.
I use these avenues of preparation to try to determine whether there can be creative business solutions to resolving the case other than simply splitting a dollar claim. And, even when the resolution boils down to dollars to be paid, the preparation is a first step in allowing me to give (confidentially and separately) evaluative suggestions to each side about the strengths and weaknesses of their positions that can assist each party in arriving at a pure monetary settlement .
In a number of mediations I have handled, insurer or multiple defendant interests must be addressed separately, and advance work can be helpful here as well in permitting me to understand all of the issues and "moving parts" for a successful resolution.
Counsel necessarily play a critical role in preparing not just the Mediator, but their own client. Advance discussion by counsel with the client about case strengths and weaknesses and potential settlement avenues is essential to having a meaningful mediation session. Preparation of a short opening statement to be presented to the Mediator and the other party(ies) at the initial joint session that is diplomatic but frank can often help the other side's business representative see the case from a different perspective as well as offer an opportunity for counsel to suggest openness toward settlement. Advance work by the parties on supporting or trimming damages claims, along with ideas for solutions that go beyond strict payment of cash, can also be helpful.
With the parties and the Mediator fully prepared for the mediation sessions, there is a much higher likelihood for a successful outcome.
( June 2016)
I have been telling clients that there are a number of what I will call “P” qualities that I have found central to success in the challenge of resolving mediations. To date, I have settled most of the completed mediations for which I have been retained by the parties, often based on one or more of these "P" pillars discussed below.
Perspective: Different parties will inevitably come to the same mediation with different perspectives about what occurred, the relative merits of the parties’ positions and how best to resolve the dispute. A successful mediator has to be able to (1) see the issues from each party’s frame of reference, (2) make sure that each side understands the other’s perspective; (3) find “ribbons” of common ground in these seemingly divergent perspectives and (4) introduce new perspectives to the situation to help find further avenues for resolution. This requires being a good listener as well as an empathetic and credible communicator. The perspective of my many years as a litigator also helps me relate to the needs and concerns of parties and counsel.
Patience: Although there are some mediations that can be resolved in one session, you need to give the parties time to communicate their perspectives, truly digest the other side(s)’ perspectives and needs, evaluate the directions in which movement can be made and the range of different potential options that might be available to get to “yes.” I try to build in some of this needed time even before the first mediation session through pre-mediation telephone conference calls with each party and often written questions sent to each side. I also often encourage parties to reserve two days for their mediation session because in many cases, resolution is simply not possible in one day. Moreover, many mediations require extensive telephone shuttle diplomacy with each of the parties after or between mediation sessions. Many times, it seems easy as a Mediator to see how a case rationally should settle, but it takes patience and the power of intense listening to each side and credible persuasion by me to allow the parties to get to common ground. Often, with time, one or more of the parties will come up with (or agree to) a new approach that bridges a gap that once seemed insurmountable. Also, there are times when discovery or proceedings in a case need to move along a bit further for the parties to better understand the risks and likely range of outcomes if their litigation were to continue.
Perseverance: Related to patience, a successful Mediator needs to be able to “roll with the punches,” and not be discouraged even when parties and their counsel are declaring impasse or refusing to budge. In one recent mediation, I was literally told by a disheartened but very capable and experienced counsel that I was essentially fired because I was not bringing value to his client’s cause given the other side’s refusal to move further in the negotiation. I refused to give up, tried my best to explain how I saw the risks and options, and ultimately brought about a settlement through a Mediator’s Proposal. I have always been an optimist by nature, and it is a good disposition for a mediator.
Persistence: This is another “P” quality related to patience and perseverance. I literally “lived” persistence as a long-time big case litigator trying to achieve the very best results for my clients. Now as a Mediator, I am just as committed, but with the goal of getting the parties to a result they can agree to themselves rather than having a resolution imposed on them by a judge or jury, with all the associated costs, appeals and downside risks. In short, I don’t give up. I may have to be patient. I may have to persevere. But I will try to persist until I can settle the case.
You might think that I must have run out of “P” qualities by now. In fact, there are certainly other "P"s that deserve at least honorable mention. First, as noted in my very first Quarterly Update piece, “Preparation” by both mediator and counsel is critical to a successful mediation. Second, when I recently ran into a long-time litigator friend and told him that I would be writing about the “P” qualities necessary for a Mediator, he correctly observed that a Mediator needs to be able to assess and address the impact of different “Personalities” of the parties’ counsel and representatives on getting to a deal. How true. I truly enjoy the “people” part of mediating, just as I really enjoyed all (or almost all) of the people interactions I had as a litigator, which helped me settle a lot of cases over the years as well as make a number of friends. And, finally, a “P” phrase, “Put it on Paper,” is a reminder that it is often helpful in a mediation to get the parties to memorialize on paper (and electronically of course) the deal struck in the mediation as quickly as possible so that neither side is tempted to attempt to avoid the deal accomplished at the mediation.
( September 2017)
Just as each litigation has its own facts and rhythms, so too mediations will differ from case to case. Some even very complicated litigations can be resolved in a one-day mediation session if enough preparation work is put into it up front, and I try to do that with advance calls with each side, both at the outset of scheduling the mediation and a few days before the mediation session itself. For example, in a recent one-day mediation, I was able to help the parties put a broken cross-border corporate sale transaction back together.
However, many complex and large stakes cases take more than a one-day session to settle, and can often require multiple sessions. I make it a practice to never give up, and to keep actively seeking a solution with the parties via email, telephone and later sessions until the case is resolved or it is made clear that no further mediation is desired.
If you have a litigation or arbitration that is in its very early stages, and there has yet to be any discovery, or discovery has just begun, it can be a very opportune time try to settle because the parties can save significant legal expense. On the other hand, the parties and their counsel may have a lot more to digest in evaluating their positions, making settlement in one mediation session not possible. This should not discourage parties, as most such cases will eventually settle.
Often, I recommend that the parties plan for at least two days of mediation sessions right at the outset, particularly if some or all of the parties or counsel will be traveling to the session. If all the reserved time is not needed to settle the matter, then all the better. But, as is often the case, if more than a one-day session is needed to move the needle sufficiently to complete a settlement, then the parties and their counsel will already be together to complete the negotiation. Even if still further sessions will be required in order finally to settle the case, the parties will be further along toward making that happen. Long running litigation in particular may take time to settle due to the size of the stakes, numbers of parties (and/ or insurers), differences in perception of risk, animosities, litigation inertia or the need for additional exposure analysis.
If the case is not settled even after the initial scheduled session or sessions, I feel that it is incumbent on me as the Mediator to continue to pursue efforts, and listen to and propose ideas, toward settlement. Those who have worked with me know that even when the case is not settled right away, I do not give up. I try to continue the discussion until there is a resolution. Sometimes I can achieve that simply with further emails and calls with counsel and/ or principals, and sometimes those emails and calls can lead to a further session that will ultimately resolve the matter.
Of course, there are instances when one or another party feels that it cannot settle the case given the posture of the other side or the nature of the issues presented. Sometimes, the parties are compelled to mediate by the Court when one or the other party does not wish to settle. I obviously cannot force parties to settle. All I can do, and will do, is use my inherently optimistic approach, years of high stakes litigation experience and neutral evaluation and facilitation skills to try to help counsel and the parties reach a settlement that will provide them with certainty in an outcome that they fully control versus the costs and uncertainties of a litigated result. In most cases, the party principals and counsel will see the light and reach a settlement.
It also helps that I like working with people and really enjoy helping bringing about a resolution.
( June 2017)
I am flexible about how I handle the initial mediation session, particularly in the larger cases that I tend to handle most, because each dispute has its own history, counsel, party chemistry and needs. However, both in the past as a litigator in mediations and now as a mediator, I have found that in many cases an initial joint opening session with opening statements by each each side (or party / party group in larger multi-party litigations) can be a very helpful first step toward resolution if it is prepared for and handled properly by all attendees.
The preparation work for this begins with the mediator: I explain to counsel on our initial conference call that I generally prefer a joint opening session with short opening statements at the first mediation session because it will allow the party representatives (and even their counsel) to hear what each party believes is important about its case and, in the best of worlds, each party's suggestions about its openness to a compromise resolution and hopefully even some ideas for settlement constructs or approaches that might work for that party. Moreover, in individual pre-mediation session calls that I have with each side, I stress that it is important to not just convey those facts or issues that you believe the other party(ies) should understand about the strengths your case but to do it in a way that is not inflammatory and hopefully suggests openness to compromise and any ideas you might have about approaches toward resolution.
Counsel's preparation is also important: Counsel should prepare an opening statement that manages not only to convey to the other side the key points that favor litigation victory for counsel's side and the potential downsides for the other party(ies), but do so in a way that is not deprecating to the opposing party and which affirmatively holds out the desire to reach a reasonable compromise resolution. I have seen mediations where one side's counsel so verbally attacks the bona fides of the other side that the effect is to close off a party's openness to resolution. Good humor and genuine courtesy toward the other side, while still holding no punches substantively, can go a long way to creating a greater potential for successful resolution.
I also encourage the party representatives, after their counsel has spoken, to consider saying a few words at the mediation to indicate their openness to a fair mediated resolution. (Even before that, in my initial call with each side, I ask for each side's commitment to work toward such a resolution).
At the joint opening session itself, it is important that the mediator act to control the tone of the session. I begin with greetings, introductions and then a little "pep talk" --which is completely true--about how and why mediation can really work to resolve the dispute, and how the mediation presents an opportunity for the parties to take control of their own destiny in self-resolving the dispute rather than leaving it up to the time consuming, expensive and unpredictable resolution by the court and even appellate courts. Before I turn it over to counsel to present opening statements, I explain to all present that I will allow each side if it desires to make a very short rebuttal statement (generally limited to five minutes). However, I discourage any questions ( unless someone truly does not understand something said) or back-and forth at this session to avoid unnecessary vitriol, and suggest that instead any issues or questions that anyone has can be raised in our first individual-side caucus session. Then I generally close out the initial session with another short "pep talk" on how and why my experience has taught me that the mediation process will succeed if the parties put in the effort into our coming caucus sessions.
There may be some litigations where there is so much history or where I have covered so much with each side (or multiple parties) before the initial sessions that opening statements may not make sense, and I am also willing to dispense with them if none of the parties wants them. Nevertheless, my experience has taught me that they often are a very helpful step in the mediation process. They allow each party to express its key points, but more importantly they allow each party to hear what the other has to say. If the statements and process are properly prepared for by the mediator and counsel, they can really add value.
( September 2016)
After the initial introductory joint session, it is time for me to speak separately and confidentially with each of the party representatives and their counsel in shuttle diplomacy between them. These "caucus sessions" are the heart of virtually every mediation. Like other aspects of the mediation process, I am flexible about how I handle the caucus sessions depending on what is needed in the particular case. I try to explore the best approach to the mediation in written email questions to the parties counsel (when there is time for them in the mediation schedule) and in my pre-mediation session conference calls.
I generally use the first caucus session after the initial joint session to ask questions to be sure I understand each party's positions and to discuss what I see as the relative strengths and weaknesses of the party's positions on the various issues in the case. I ask about reactions to the opening statements in the initial joint session. I try to hear out the viewpoints, facts and emotions guiding the thinking of each party. I want to be sure I have identified with the party what the major issues in controversy are from its perspective. I want to be sure I understand the prior settlement discussion history, if any, beyond what I have learned in the pre-mediation conference calls and mediation statement submissions. I want to be able to see the dispute through the eyes of the party representatives as well as my own.
At some point, I will begin to convey to the party a general initial viewpoint on how I am evaluating each particular issue ( i.e., which side has the better argument as I see it now and any nuances about the value of the issue to the dispute) and ask counsel and the party representative(s) to tell me if, how and why they see things much differently. The party may change my mind or influence how I am perceiving a particular issue as a result of this discussion. I also try to get an understanding of what each side realistically sees as the range of possible damages should there be any liability. I also use this session and my pre-mediation session conference calls and pre-mediation session written questions to try to tease out whether there are other avenues for relief besides the pure payment of money--such as, for example, (a) future business relations or employment, (b) an agreement to leave a portion of the dispute for resolution by means of an agreed yardstick based on potential developments over an agreed period such as the next 12 or 24 months, (c) an escrow arrangement, equity participation or payments over time (c) some revisions that would revive a failed deal or (d) other ideas to try to expand the "pie" of potential approaches to bridge the parties' positions.
Even before the very first caucus sessions, I try to chart for myself the various issues. Then, as the caucus sessions proceed, sharpen my thinking on rough percentage chances of each side prevailing on each of the various issues, and each issue's significance to the resolution of the overall dispute, as well its impact on a rough range of potential monetary damages or other relief in the case. With this, I try to begin to frame a monetary ( and/ or non-monetary) range of where the parties should consider settlement. I then try to work with each of the parties ( or sides), in the separate caucus sessions to get either full initial offers or their reactions and input into an appropriate range of relief (monetary or non-monetary) in which to negotiate.
Only sometimes will I ask for an actual settlement offer in the first caucus session. This may be perfectly appropriate when there has already been some settlement exchanges between the parties and an "offer" is really due. But in other cases, I do not yet want a party to harden its position into an offer because it may be too extreme at this early stage to be sufficiently productive.
There is sometimes a debate between the parties about who should make the first offer at the mediation, which actually should make little difference, but I can get around this by agreeing to get both sides' "soft" offers confidentially and not to be shared with the other until I convince them both that I believe that the other party's approach is sufficiently within reason to allow offers to be exchanged. I make myself a fount of optimism, leaving no stone unturned in a search for a compromise resolution. Sometimes a party will be more willing to move on some issues rather than others. Perhaps the other side finds another issue more appealing on which to move. These can be traded off to bring the parties closer on the final outcome. The important thing is to try to avoid the parties locking themselves into final impasse positions that make forward movement impossible, reminding them of the unnecessary risks and costs of litigating the case to a judgment over which they will have no ultimate control of the outcome.
Every mediation has its own rhythm, potential avenues for compromise and personalities. It is up the Mediator to be ever sensitive to the opportunities for resolution that are presented by the peculiarities of the particular case.
If the parties appear to be at an impasse that cannot be bridged, I will often offer to provide a single final "Mediator's Proposal" for resolution. This is non-binding, but the parties agree that they will each either accept or reject the proposal confidentially to me. I tell them that I will not tell either party what the other party's answer to my "Mediator's Proposal" was unless both sides have accepted it. If there is not acceptance on both sides, I will only convey to both sides that the proposal was not accepted. Sometimes I give the parties a day or two to think about the proposal before responding. Other times, it can bridge a gap at the mediation session itself.
Finally, it is important to note that some cases cannot be settled in the first day or even two days of mediation. I generally encourage parties to schedule at least two days of mediation in case we cannot settle the case in one day, but in some cases, even two days are not enough. Sometimes one or more of the parties feel strongly that they need to know the resolution of a dispositive motion before they can commit to what it would take to reach a compromise. Sometimes a party may misread its chances in litigation or arbitration or the huge drain on resources that continued litigation will entail. Sometimes something in the business climate behind the dispute changes, opening a new window of opportunity for settlement or at least temporarily closing the window for a settlement. For all these reasons, even if the originally booked mediation session(s) have not produced a settlement, I let the parties know that I am available to continue talking by telephone or by further sessions to help them take control of their own dispute and settle it.
In fact, when a case does not settle in the allotted mediation sessions, I most often will continue to attempt telephone shuttle diplomacy even if I cannot immediately bring the parties together. Not infrequently, an additional session or series of telephone calls can resolve a case or bring about that one more session that resolves a case.
( January 2017)
Part and parcel of the Mediator patience, persistence and perseverance necessary to achieve a mediated settlement in many cases will be the telephone and email shuttle diplomacy that follows an initial mediation session at which a settlement has not yet been achieved. Of course, the ideal is to try to settle at the initially scheduled formal mediation session(s), and for the mediator and parties to prepare in advance to try to make the scheduled formal sessions as fruitful as possible. But the reality is that every case has its own timing, and in quite a few cases, when efforts at the initial scheduled session(s) fail to bring about an immediate settlement, shuttle diplomacy using mostly telephone but also email can bring a mediation to a settlement.
If I am unable to settle a mediation at the initial session(s), I try to work the phones and emails until I can bring the parties to common ground. Sometimes a second formal session or group of sessions will be necessary, but quite often I can achieve a settlement through a combination of telephone and email efforts alone once I have gotten to know counsel and the parties at the initial sessions and in the preparatory telephone conferences before the sessions. Further bonding is also common in the post-session telephone exchanges with counsel and/ or their clients, when I am able to discuss the needs and concerns of each party and the range of options open to them.
Those who have worked with me know that I don't give up on a mediation, and telephone shuttle diplomacy set up by, and complimented with, email exchanges can often bring about the final result that all parties need even without further formal sessions. (March 2018)
ITS ALL ABOUT COST EFFECTIVE RESOLUTION THAT YOU CONTROL
Whether its Mediation, Arbitration or retaining a Special Master, alternative dispute resolution is, or at least should be, all about the parties themselves exercising greater control over the resolution of their dispute, the mechanics and costs, and its outcome. You drive the bus.
Mediation gives the parties ultimate control: over the choice of mediator, over the procedural steps and, most significantly, over the outcome. If the parties truly invest the effort and truly are willing to reach a compromise resolution that they themselves completely control, mediations should almost always be successful. As a mediator, I try my best to get the parties to a place where they can most effectively exercise that control by exploring the range of choices and alternatives and providing some neutral perspectives that are often absent in the heat of litigation.
Arbitration gives the parties a large amount of control over the process. The parties can choose the rules, the forum, the law, the procedures for pre-hearing, hearing and post-hearing, and depending on the arbitral rules chosen, can choose one arbitrator of a tripartite panel and have input into the selection of the panel chair/umpire or input into the selection of a single arbitrator or arbitration panel by a "strike and rank" system or even by agreeing directly with the other side on a well respected arbitrator that both sides can trust. The parties can also use arbitration to control costs and bring about quicker resolution: by limiting discovery, by proposing resolution through motions, by limiting the amount of time for testimonial evidence at the hearing, by agreeing to rules with time limits for party and arbitrator actions, by using only a single arbitrator or, even in a tripartite panel arbitration, agreeing with the other side, after proceedings get underway and comfort develops with the chair/ umpire or another particular arbitrator, to empower only that single arbitrator to resolve either the entire case or all pre-hearing issues or one particular issue such as damages. If the parties want an appeal, an appeal panel with a mandate for expedited resolution, can be agreed as part of the process in most major arbitral organizations. The parties can even act to exercise some control on outcome by agreeing to variants of "high/low" or "baseball arbitration."
Utilizing a Special Master for discovery can also add control and reduce costs by allowing for immediate or near immediate, real-time resolution of issues by a trusted and experienced neutral who can devote the time to work with the parties toward consensual resolutions and quickly decide issues around which consent is not possible. Large numbers of sensitive documents can be reviewed quickly by a neutral without the necessity of involving the Judge.
Finally, the degree of control that these alternative dispute resolution methods can give parties to a dispute is also demonstrated by the use of these methods in combination. I have mediated to resolution a number of disputes that were in arbitration, and have served on arbitration panels where the parties engaged a mediator to resolve the dispute. While serving as a Special Master, parties have asked me to also serve as their Mediator to help them resolve their case entirely. Parties at the outset of a dispute can agree to a Med-Arb procedure in which a neutral will conduct a mediation to help them try to resolve the case, but if they cannot agree on a resolution, that neutral (or another) will resolve the dispute as the Arbitrator. Similarly, the parties can agree to an Arb-Med procedure in which the parties fully arbitrate a dispute before an Arbitrator, so that the parties can see how the evidence was presented by both sides, but the Arbitrator after writing the Award will delay issuing it, as that arbitrator (or another chosen neutral) attempts to bring about a mediated resolution.
All of these procedures can be used to speed resolution, reduce costs and maximize control over the procedure and outcome. I would be pleased to discuss any or all of them with you.
THE OUTCOME IS THE MESSAGE
Only rarely does civil litigation truly require battle all the way through to ultimate adjudication. In the meantime, the parties are spending enormous sums to litigate motion after motion, plow through enormous document and deposition discovery, retain and depose experts and prepare for a trial that is unlikely to ever occur or, if it does occur, comes only after all parties have already spent enormous treasure. Within the past few weeks, more than one prominent judge has said to me that they have been shocked at the waste of resources on both sides. There are some sensible answers.
Don't Wait to Mediate. What constitutes smart early mediation can obviously differ for different cases. Plainly, each party must have a some prior opportunity to understand the case and its prospects. There may be some cases where a party reasonably believes that there is a sure-fire early dispositive motion, and cannot settle before that motion is heard. However, some cases cry out for early mediation: mergers and acquisitions disputes, business relationship breakups, battles over representations and warrantees, hotel/ real estate disputes, pharmaceutical compound development disputes, business contract battles, employment disputes, insurance coverage cases and trade secrets cases come immediately to mind. Class actions can also be amenable to earlier resolution than actually occurs in most cases. Even if the case cannot settle at the first attempt, a good mediator will persevere and try to keep discussions going to bring about resolution later in the case. And even a mediation commenced late in a case is better than no mediation at all.
Special Master. A good special master can save the parties motion and discovery expense by helping them cut through discovery disputes and cost-effectively get necessary discovery completed. When parties see what a special master can help them accomplish, it can show them the way to mediation as a next step. I recently mediated a case to settlement at the request of both parties after first serving as their discovery special master.
Arbitration. Even without a contractual arbitration clause, the parties to a dispute can still agree to arbitrate rather than litigate a dispute before a sophisticated neutral or panel of neutrals under rules that would streamline timing and costs and preserve confidentiality. Alternatively, there are also two step procedures, such as Mediation-Arbitration (Med-Arb), where mediation immediately procedes arbitration, or Arbitration-Mediation (Arb-Med), where just before an already completed arbitration award is released to the parties, there is an attempt at mediating the dispute to a consensual resolution based on both sides having witnessed the entire arbitration hearing. Most clients want their lawyers to help them achieve a positive outcome for their dispute. Fees, expenses, publicity, time investment and risk are all part the outcome calculus. ( June 2019)
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