Five Factors that Suggest a Case is Ripe for Mediation

Anyone who has been involved in the dispute-resolution mechanism knows it can be a laborious and often mysterious process. Somewhat over simplified, here is a good way to remove some of the labor and mystery, and describe how mediation fits into the system: Mediation allows the parties involved in the dispute to sidestep the litigation process, while also getting results. Because of the mediator’s neutrality, the settlement resolution is more likely to be perceived as just. It is a voluntary, non-binding forum in which the parties agree to conduct negotiations using a neutral intermediary who guides the parties through the legal process. The mediator has no decision-making authority. Rather, it is the mediator’s duty to work with the parties to agree on the terms for conflict resolution. Only if they want to do the parties settle.

So what types of cases are likely to settle at mediation? Here are five factors that, if present in the case, suggest it is one which should be mediated:

· The parties recognize they have more to lose than if they don’t settle. There is high risk if they do not settle. This means not only must there be a downside risk, but also the parties and their lawyers must recognize and understand that risk. If a party and/or counsel have their head in the sand or are refusing to acknowledge the loss possibility or probability, then this leads to an unrealistic evaluation of the case and a failure to appreciate the benefits of a negotiated result. It also leads to unrealistic demands or offers and responses to such. Lastly, it means a mediator is not talking or listening to reasonable minds. This state of affairs costs the parties in many respects, including the time and money for a trial that may very well fail to result in a “win” for anyone.

· There has been cooperation among the parties and their counsel during the litigation process. This is key. No doubt a case has a greater potential for settlement when the parties are “firm but fair” with one another. They cooperate without compromising their clients’ rights or position. They exchange what they know is discoverable and they diplomatically but firmly protect what is not. They prepare their client for participation in the litigation process. For example, I try not to intervene at my client’s deposition. He or she is prepared to tell the story, and tell it truthfully. I don’t need to make inappropriate speaking objections or interfere with my opponent’s questioning unless counsel is violating the rules, being rude, harassing my client, or asking questions about irrelevant or privileged matters. Then, rather than arguing on the record and creating useless transcripts, I state my position and deal with this bad behavior appropriately as the rules permit. But, if we are conducting the case within and in accordance with the rules, the prospective of a cooperative discussion about resolution is highly likely.

· The parties have engaged in sufficient discovery and an exchange of information so that you know the facts of the case. You have reached a plateau in the case; each side can look towards the door of trial court and see how the case is likely to play out. Experienced trial lawyers can do this. They “hear” the evidence, they play out the examination of witnesses in their minds, and they anticipate the argument of their opponent. They know how these arguments will sound and how a jury, court, or arbitrator might respond to them. Perhaps the parties have conducted focus groups and obtained some insight into how a jury might decide. It is the ability to anticipate the “end result” that allows a trial lawyer to properly advise his or her client as to the alternatives of resolution by trial.

· The parties have non-lawsuit reasons to settle. There may be non-lawsuit related reasons to settle. The existence of the lawsuit or a “bad” result may trigger losses in business relationships or a negative impact on a business marketing plan. The parties may also have an ongoing business relationship which would be costly to terminate. There are lots of business and personal reasons to settle, and if these are present they will motivate the parties to seek a negotiated result.

· While the liability, damages or collection issues remain, there is no clear barrier to recovery and payment of any judgment by the plaintiff. A lawsuit is a three legged stool: liability, damages and collection. All three have to be present in order for the case to have value from the plaintiff’s perspective. If any of these three legs are missing, the plaintiff has problems and needs to assess what course is the best way to move forward. Indeed, a modest settlement may be in order in such a case. But if there is no clear barrier to the plaintiff and the stool has some strength in all three legs, then the parties should be talking seriously about resolving the lawsuit. There may be a disagreement over the numbers, but that is why mediation is attractive at a timely point in the litigation process – to save the time and expense of trial, and eliminate the risk of a disappointing result.

Opening Statement at Mediation

One question that generally comes up when preparing for a mediation is whether counsel should give an opening statement in a general session before the actual negotiating begins. A subquestion is if an opening statement is advisable, what type of presentation should be given? What should be the purpose, content and tone?

Should An Opening Statement be Given: Is There a Purpose?

In my view, an opening statement at mediation should not be given if it will create hostility or divisiveness. Sometimes a client will want a preliminary statement to assuage that client’s own anger and hostility towards the other side. That is not a valid purpose because it will not contribute to the mediation process. Anything that escalates the tensions between the parties or heightens the temperature in the room is not a desirable tool for mediation. In short, an opening statement should not be adversarial, but should be devoted to demonstrating an attitude of wanting to reach a resolution of the dispute at hand.

Otherwise, whether an opening statement is given depends on its purpose. That is, it must have a purpose first of all, and that purpose must contribute to the mediation process. The best reason for an opening statement is to add information to the process or explain the position of the party delivering it if the information is not already available, or there needs to be clarification of that party’s position. Despite a comprehensive written presentation, there may still be issues or positions that need clarification. If so, an opening statement should be used to provide additional information about a party’s case.

One of the occasions where I find an opening useful is to clarify damages claims. There may be questions about the relationship of injuries to an accident, or about special damages, past and future. There may be medical issues; questions about future medical care, rehabilitation efforts, and income earning capacity once the injuries have stabilized. These questions may have come up in a pre-mediation conference, so the parties may want to address those issues with additional information that has developed.

However, an opening statement is not a time to rehash what has been spelled out in a mediation statement or just review what the parties already have had an opportunity to absorb. The opening statement is appropriate if it will help focus the parties on the issues to be addressed at the mediation, and provide additional information useful to moving the parties closer to a bargained result.

What Should be the Tone?

As noted, hostility and an adversarial tone do not contribute to the process. An educational and informational tone is the right one to choose for this type of presentation. Successful “across the table” negotiators do not achieve desired results with this approach in any format. As a voluntary process, mediation will not be successful if the parties display their anger and bitterness (despite its presence) to any joint sessions. Venting can be done privately, but not when the parties caucus.

Anything less than a high level diplomatic approach will only lessen the chance of settlement. This is not to say that the parties should appear to be begging for a result, but a high level of professionalism and willingness to explore settlement options should be the attitude of all involved once any joint session is over. The spirit should be: Let’s try to get it done!

An appropriate opening statement can be a valuable tool for working to a positive end result.

What Should It Contain?

The answer to this question is obvious: information that adds to the other side’s basis of information, clarifies issues or facts in the case, or makes the position of a party clearer to the mediator and other parties.

I like to use a supplement, either an outline or a PowerPoint presentation. However, these tools should be used simply to give the presentation some structure, not to overwhelm the parties with more paper or numerous slides with crammed detail. The opening statement, as I envision it, is a summary of information so that the issues and facts have a clearer focus, and the mediator and the parties can begin negotiating around their dispute.

One further point: An opening statement is often a good time to concede facts or issues. For example, I have had mediations in which the defendants said in their opening that they were not going to focus on liability because they had worked towards an apportionment among themselves. This allowed my client to focus on evaluating the case for settlement purposes and discussing damages. Obviously that was good news, and it also made the mediation day a productive discussion of some serious and real damages questions.

Be Creative; You May Involve Others!

You can be creative with an opening statement at mediation. You do not have the constraints that you have at trial. For one, you can discuss the facts without worrying about objections, admissibility or argument, although you certainly do not want to fall into an argumentative statement that will violate the appropriate “tone” that I think should be used. Second, you can involve others. Frequently I take an “all purpose” expert or consultant with me who can present an overview of the technical aspects of the case. For example, our medical consultants, retired physicians who assist in reviewing the medical aspects of our cases, sometimes attend to explain injuries, comment on causation and answer questions, while recognizing that they are not our expert trial witnesses. I also use consultants whom I regard as good “translators” of technical arenas, and who can give an overview of aspects of the case. They are highly credible, and what they present is done within the confidentiality of a mediation and with the understanding that they are not going to testify at trial, but are serving as consultants. This expert overview can be provided at a lower expense than if you asked two or three experts to attend or provide video statements for mediation purposes only.

Clearing the Opening with the Mediator

On mediation day it is the mediator’s show. So, I want to clear the agenda with the mediator before I plan on making any opening statement. The mediator may not want it. He or she may want me to forego an opening initially and save it for later in the day if it is believed some comments in a joint session will help the parties in their negotiations.

If an opening is invited, I usually give the mediator some idea of my approach to make sure it blends in with the mediator’s agenda and approach to the settlement discussions. No surprises - at least not for the mediator!

A Final Comment

You should let your client know about the difference between the opening statement at the mediation and at trial. The client may expect a gang-busters trial lawyer’s presentation. Perhaps if an opening statement is to be given, you should ask the client what his or her expectations are, and then inform them of the purpose and reasons for your presentation and generally how and what your are going to say. That way the client’s expectations are appropriate for the day, or at least for the initial joint session.

Empirical Research Confirms that Negotiated Results are Superior to Going to Trial

Recently, there was a report published of empirical research confirming that settlement is preferred to trial because the potential result is statistically found to be a better economic result. The newly released study reviews the results on a large number of cases that did not settle after mediation and eventually went to trial and addresses how those cases fared in comparison to the last settlement offer or demand.

The September 2008 Journal of Empirical Legal Studies (Vol. 5, No. 30, pp. 451-491), a joint venture of Cornell Law School and the Society of Empirical Studies, has published the results of a quantitative evaluation of “the incidence and magnitude of errors made by attorneys and their clients in unsuccessful settlement negotiations.” The study entitled, “Let’s Not Make a Deal: An Empirical Study of the Decision Making In Unsuccessful Settlement Negotiations,” was done by two faculty members and a graduate student from the Wharton School of Finance, University of Pennsylvania. The study analyzed 2,054 California cases in which the plaintiffs and defendants participated in settlement negotiations unsuccessfully and proceeded to arbitration or trial and compared the parties’ settlement positions with the award or verdict. As the study states, it “reveal[ed] a high incidence of decision-making error by both plaintiffs and defendants in failing to reach a negotiated resolution.

The study actually builds, as is noted below, on prior research in four studies so that the cases analyzed totaled 9,000 in the past 44 years. It compared the results in selected cases in which the parties exchanged settlement offers, rejected the offers of the other side, and proceeded to trial or arbitration. While the large group of cases were jury trials, court trials and arbitrations were included. The study was based on the report of results from California Jury Research (formerly California Jury Verdicts Weekly), which the authors found reliable.

As it states: “The parties’ settlement positions. . . [were] compared with the ultimate award or verdict to determine whether the parties’ probability judgments about trial outcomes were economically efficacious, that is, did the parties commit a decision error by rejecting a settlement alternative that would have been the same as or better than the ultimate award.”

Prior studies were reviewed and summarized as follows:

• Priest/Klien (1984-1985): Trials occur in “close cases,” and plaintiffs and defendants equally make mistakes; plaintiffs win about 50% of the cases that proceed to trial; this is referred to as the “fifty percent implication”;

• Gross/Syverud (1985-1986): 529 cases from June 1985 to June 1986 were studied; they questioned the validity of this type of research because the context of the negotiations and relationship of the parties and counsel affected the behavior of the parties;

• Gross/Syverud (1990-1991): Here, 359 cases were studied, and the results conflicted with the 50% distribution of “mistakes”; they found plaintiffs were more likely than defendants to reject a settlement opportunity that was more favorable than the result;

• Rachlinski (1996): He compared final settlement offers with jury awards in 656 cases. His findings were that plaintiff had a higher percentage of error (56.1% of the cases), but the average cost was $27,687, while defendants had a lower error rate (23%) but a greater risk of a bad result, with an average cost of $354,000. He concluded that plaintiffs were risk averse while defendants were risk seeking; that is, the risk of trial in these scenarios benefitted plaintiffs but it cost the defendants significantly.

Here is what the researchers found in the most recent study:

• Comparing the actual trial results to rejected settlement offers, the study found that 61% of the plaintiffs obtained a result that was not economically better than the settlement offer, i.e., it was either the same or worse than what was offered;

• In contrast, 24% of the defendants obtained a result that was not economically better;

• However, although the plaintiffs experienced more results that were not as economically good as the last offer, the risk of defendants rejecting the last settlement demand was higher.

• When the plaintiffs rejected an offer and went to trial, and did better, it was not that much better – an average of $43,100 over the last offer;

• However, when the defendants rejected the last demand and went to trial, and did worse, it was much worse – an average of $1,140,000 worse!

The study also found that the cost of “decision errors” in failing to accept the opportunities to settle increased between 1964 and 2004. In 1964, plaintiffs obtained worse results at trial than were available through settlement in 54% of the cases, while in 2004 it rose to 64% of the cases. During that same period, the range for defendants went from 19% in 1964 to 26% in 1984 and then declining to 20% in 2004. And, the cases in which neither party committed a decision error decreased from 27% in 1964 to 14% in 2004. Adjusted for inflation, the researchers found that a plaintiff’s decision errors increased 3 times, but a defendant’s errors were much more costly – increasing 14 fold.

Another interesting aspect of the study is the effect that statutory offers and cost shifting procedures had on the eventual results in cases going to a final decision making process. In California, under Code of Civil Procedure section 998, either party may make an offer of settlement which, if rejected by the other, can shift certain costs, including those of experts to the other if the result is less favorable than the statutory offer of judgment. The researchers found that instead of encouraging parties to consider settlement because of the cost shifting consequences of statutory offers, these offers had an opposite effect – instead, the parties were more likely to take aggressive settlement positions, resulting in “financially adverse outcomes,” than the other parties in the study. The “decision errors” for plaintiffs who rejected these statutory offers was 83% compared to the 61% plaintiffs who were not subject to such. Defendants made “decision errors” in 46% of the cases when facing a statutory offer, whereas the rate was 22% who were not faced with such.

Another finding that may not be surprising is that in cases in which litigants were represented by attorneys who had mediation training and experience, the parties experienced lower rates of “decision error.” Indeed, plaintiffs in these cases had a “decision error” of 21%. The authors suggested more research in this area.

It is quite apparent that the most recent study has dispelled the notion that the “fifty percent implication” rules applies. It has established a new dimension of risks for both plaintiffs and defendants in rejecting opportunities to settle. Plaintiffs risk the further costs of litigation and a result that is not that much better, which likely does not justify the investment of time and money in taking a case “to the mat.” Defendants, on the other hand, have a huge downside by risking large verdicts against them if they do not appreciate the opportunity they have by a negotiated closure.

The 40 page review of the study’s results is worth careful reading. It may also be important in reviewing the advantages of settlement versus trial with our clients.

The New Lawyer - How Settlement Strategies and Opportunities Have Affected the Responsibilities and Functions of Litigation Counsel

Anyone who has been involved in the dispute-resolution mechanism knows what a laborious and often mysterious process it can be. Mediation allows the parties involved in the dispute to sidestep the litigation process, while also getting results. Because of the mediator’s neutrality, the settlement resolution is more likely to be perceived as just. Mediation is a defined process that is recognized by attorneys and judges. It is a voluntary, non-binding forum in which the parties agree to conduct negotiations using a neutral intermediary who guides the parties through the legal process. The mediator has no decision-making authority. Rather, it is the mediator’s duty to work with the parties to agree on the terms for conflict resolution.

During mediation, the attorney’s responsibility is both as an advocate and counselor to the client. When advocating an issue, the skills used by an attorney are different than the approach used in a courtroom. An attorney also counsels the client on issues during the mediation.

Mediation helps litigants achieve settlement. When compared to the expense of prolonged litigation, mediation may be the best deal. The client has present use of funds, rather than the hope of financial recovery later, while also saving money on pre-trial and trial costs, as well as possible appeal. Litigation costs often surprise clients, particularly if expert testimony is needed. The fees for experts are quite high, usually involving several hundred dollars per hour. During the amount of time experts need to prepare, testify at deposition and appear in court, several thousands of dollars in costs may be incurred quickly. Thus, at an early mediation, a major factor in considering whether to settle is the future expense of proceeding without settling.

If possible, it is important to work toward mediation as early as possible so that the client may reach his or her goals. Bear in mind that the client is not going to push early mediation. It is the attorney’s responsibility to recognize the advantages of an early mediation and resolution for the client. Most courts, however, distributed alternate dispute resolution materials shortly after a case is filed and either urge counsel to pass the materials on to the client or require them to do so. However, unless the attorney couples this will some counseling on the availability and value of mediation, it is questionable if receiving this material has much impact on the client.

Research shows that a key factor in litigants’ willingness to use mediation is the recommendation and encouragement of their attorneys. For example, “a majority of parties in domestic relations cases (68 percent men and 72 percent women) who chose to use mediation said their attorneys had encouraged them to try it, whereas less than one-third (32 percent men and 18 percent women) of those who rejected mediation had been encouraged by their attorneys to use it.” (R. Wisler, When Does Familiarity Breed Content? A Study of the Role of Different Forms of ADR Education and Experience in Attorneys’ ADR Recommendations, 2 Pepp. Disp. Resol. L.J. 199, 204.)

Mediation involves an objective intermediary who negotiates with the parties to avoid or end the highly confrontational and tension-filled process of litigation. From the plaintiff’s perspective, it is a means of essentially selling the lawsuit to a defendant, who buys off the expensive and exposure of ongoing litigation. It involves an exchange of offers and counteroffers made in more of an informal business environment, rather than a formal courtroom.

Hostility, anger, finger pointing and accusations are not part of the mediation process. Diplomacy, salesmanship and patience are the bywords. The parties and their lawyers may be firm, tough and even hard-nosed at times, but they need to do it politely and diplomatically. The parties need to be prepared for mediation by having the appropriate attitude before attending the mediation. Unlike a deposition, this is where the client enters the business process of resolving disputes and essentially steps outside of the courtroom.

It is advisable to have a pre-mediation conference several days before the mediation occurs. This is two fold process: The mediator may conference (by phone usually) with counsel for the parties, either one on one or together to discuss the mediation, insure that the parties are ready, and that mediator has what he or she needs to make the process work. Counsel should also meet with the client to discuss the process, cover important aspects and get the client ready for the negotiation and decision making process of attempting to reach a resolution of the dispute.

Three aspects are important to stress; First of all the client needs to know that this is not a binding process; there is no third party who is going to decide the case and impose that decision on the client. It is client’s decision to settle. Second, the client should understand that this is not a confrontation. No one is going to testify. It involves an exchange of information so that the parties can be informed and negotiate. Third, the client must understand that what takes place at the mediation is confidential. It may not be brought up during a court trial.

The client should also be encouraged to keep an open mind as the process takes place. Many times, the client’s perspective on settlement will change as the mediation progresses. That is good because the client hears what the other side has to say and can consider the points and counter-points of the case and factor those into the decision making process. It is important for both counsel and the client to listen to what the other side says and also to the mediator’s comments. The mediator will often comment on issues and give his or her views on each side’s case. The mediator may offer the pros and cons of settlement versus proceeding further. This provides an objective, third-party view of the matter, which may be very valuable.

As the future unfolds, more and more courts will be creating ways for litigants to enter the mediation process at an early stage. The San Francisco Superior Court recently instituted an early mediation program. The San Francisco Bar Association also has a program for early mediation. The federal court has a program of early mediation and “early neutral evaluation” for several years. The future litigation process will rely more on courts and counsel directing litigants to a mediation alternative to litigation – and the earlier the better.

One concern I have is that I am seeing some reluctance of counsel to guide a case toward the mediation process because of the economic motive of being able to continue to bill a case and earn revenues. Frankly, I have seen evidence of this with opposing counsel in some of our cases. I have also heard this concern expressed by my trial lawyer colleagues and some mediators. It is indeed troublesome when counsel will not communicate with me about mediation even after I have offered to work together to get a discovery plan, or an exchange of information so that we can each have access to what we need to evaluate the case before we discuss resolution. In these troubled economic times, when law firms are folding or letting staff go, there is a concern that the motivation for economic survival will override the professional obligations to work towards a timely and efficient resolution of a dispute.

There is nothing to lose by mediation and only much to gain, and it is our duty as lawyers to see that a case is tested in that process. Who knows, a good result on both sides may mean more business rather than less.

The Lawyer's Role in Preparing the Mediator for Mediation

Let’s not forget that as our client’s advocate at mediation we have a job to do in preparing the mediator. Before the Mediation starts, the mediator knows only what he learns from the submissions of the parties beforehand. He can learn more about the parties’ respective positions during the mediation, but it is important to give the mediator as much information about the facts of the case, the opinions of experts, the legal issues, and your client’s position in advance so that the mediation day can progress without the mediator having to probe counsel for more information that was not provided initially.

Mediation Statements

I am frequently surprised at the skimpy mediation statements that my adversaries submit. Often they submit just a few pages which outline not much more than the answer to the complaint, or they misstate or mislead the mediator as to the facts or law.

Seldom are out mediation statements less than 30 pages. They contain a detailed factual recitation that is usually in a chronological order with headnotes broken down by date range, event or some description. We try to make the factual recitation interesting so that it tells a story. In short, we tell the mediator: “This is what the court and jury are going to hear about our client’s case!”

We also include summaries of what our experts are going to say about liability and damages, often in a separate section of the mediation statement with a separate topic heading devoted to “Expert Opinions.”

Then we outline the law focusing on key cases (often attaching one or two cases with key parts highlighted for the mediator). Most often our discussion of the law is based on the jury instructions that we believe will be given by the court. If we are mediating either before a dispositive motion is filed or after it has been filed and before any hearing, we will use a separate section of the brief to advise the court why our motion will be granted or a defense motion will be denied. If our brief has been filed, we will submit a copy of key moving papers to the mediator.

The opening of our mediation statements is usually entitled, “What is This Case About?” In two or three paragraphs we try to outline the essence of the case and the claims of our client – how our client has been irreparably injured by the conduct of the defendant.

We construct our mediation statement so that after the mediator reads this introduction and the first new pages, he/she will say: “I got it.”

Exhibits

The proof of the pudding is in the eating. That is what exhibits are all about. They not only establish facts buy verify the statements in a mediation statement. We include exhibits, which are organized as they are referenced in the mediation statement. Again, we highlight key portions which verify our story about the case. While we do not want to overwhelm the mediator with more than can be absorbed in a reasonable amount of preparation for his/her role as mediator, we also don’t hold back if we need to verify the facts or expert opinions that support our client’s case.

Videos

Seldom do we attend a mediation without a mediation video. I have written a column on these (August/September 2008, Volume II, Issue 8).

These videos can include family photos (in a death or serious injury case), videos of locations where an accident takes place, a series of photos of damaged vehicles or products that are the subject of the case, reenactments and computer simulations, news segments from television reports, interviews of witnesses (such as family members about the value of the lost relationships in death or serious injury cases), key documents with important portions highlighted or enhanced, and event interviews of expert witnesses.

Material that is specially prepared for the mediation and that is not otherwise available to the parties may be labeled as confidential. We always put an admonition at the beginning and ending of our video that it has been specially prepared for the mediation and is deemed a confidential mediation submission. We cannot protect inclusions which are otherwise discoverable or admissible, but we can protect our work product from being used at trial. (Cal. Evid. Code § 1119(b); Stewart v. Preston Pipeline Inc., 134 Cal.App.4th 1565, 1576 (2005)[“videotapes…were…covered by the mediation-confidentiality provisions of section 1119 to extent that they were prepared for the purpose of, in the course of, or pursuant to, the mediation in the underlying action.”].

Private Letters

The confidential, private letter to the mediator is an effective tool in preparing the mediator before the mediation. We use this letter as a means of:

· Advising the mediator who will attend the mediation on our client’s behalf, giving a brief description of their role (client’s family, consultants/experts and our attorneys);

· Providing the mediator with additional information about our experts and consultants (e.g.. medical reports from consultants who have evaluated a part of the case and advised that their opinions would not support a particular damage claim);

· Demonstrating structured proposals;

· Submitting written statements from witnesses that the other side has not obtained in discovery;

· Providing information on insurance and our comments regarding the carrier’s position and approach;

· Providing comments on apportionment of liability among several defendants;

· Providing comments on prior dealings with defense counsel and/or the parties or carriers involved;

· Relaying thoughts on how the negotiations might progress.

The private letter assumes that the formal mediation statement will be exchanged. I am an advocate of exchanging mediation statements. Maybe it will not tell the other side everything, but it will put your case before your adversary. Unless the adversary knows that case, how can its counsel evaluate your position?

Pre-Mediation Conference

I am also a fan of a pre-mediation conference with the mediator. This serves several purposes. First of all, the mediator can outline what is important to him/her (i.e. what information is deemed important for the neutral). Second, the mediator can advise the parties of the date for a timely submission of the written submissions. Third, the parties can exchange ideas on how the mediation should be approached. And, if the parties need additional information before the mediation, they can request such.

Timing of the Mediation Submission

I also believe that any mediation submissions should be provided at least week before the mediation. In fact, weeks before is not too early. It is not effective to submit a several page statement a day or two beforehand. If counsel cannot do better, then the mediation should be continued to a date that will allow the parties to have a full and timely exchange of information, and the mediator will have what he/she needs to give them the best chance for resolution.

What Type of Negotiation Personality Are You

Before representing your client in negotiations, particularly in the more formalized environment of a mediation, it is important to assess what type of negotiator you are. You, your client, and any mediator who is used, must work together to seek a voluntary resolution. That takes a different persona than the advocate at trial. You are indeed still an advocate, but one with a different presence.

Recently I attended a mediation in which we represented a local auto retailer that made available rental cars for its customers and also to employees. An employee rented a car and was involved in an accident in which he was killed and his passenger was seriously injured. Both sued. Our client was named in the lawsuit even though there was a separate subsidiary handling the rental operation. There was a CGL policy which sought to exclude rental cars. The client’s broker had not obtained proper coverage for our client. Faced with a limits demand, the CGL carrier settled and sought reimbursement from our client. We sued the broker as well.

The broker’s attorney was difficult. At a mediation of the cases, he exhibited an antagonist and hostile attitude that interfered with the process. He just did not “get it.” It made the process difficult because my client and the carrier wanted to settle the case. I just did not understand why the broker’s lawyer had to be so difficult. Fortunately, there was a more responsive claims representative from the broker’s carrier present, and based on some excellent skills by our mediator, the whole case was resolved.

Negotiating a case is an active and dynamic process which inserts your personality into the case as an advocate for your client, just as it does at trial. The advocacy, however, is different. Instead of simple persuasion, you are using your skills to cause your adversary and his or her client to recognize the vulnerability of their case, and to voluntarily enter into the process of trying to find a point of resolution before trial. Your adversary must be motivated to seek that resolution, and your approach and personality are parts of the process of that motivation.

Each of us presents a personality in negotiations. There are some lawyers I know who are excellent in most all respects but have a hard time switching hats from pure advocacy to negotiation advocacy, which is a much different process. They are tough, hard-hitting lawyers who can push a case, work it up for trial, handle the motion practice, and try the case. However, when it comes to changing gears to a “negotiator,” they just don’t seem to understand the process well enough to be very effective. As a result, they end up with cases that do not produce good economic results: verdicts between offers and demands, or simply cases where the necessary expense of trial is not warranted, i.e., cases where liability may be strong but the damages or collection of the judgment does not justify a full-blown trial.

My sense of the personality types – generalizing of course – is as follows. Bear in mind that some present a combination of these, or in rare cases, all of these:

· The Aggressive Type – no mater what the discussion, this type tries to take over and control everyone by being very aggressive.

· The Angry Type – everything seems to evoke an angry response, sometimes raising the temperature of the negotiations. Not good, obviously.

· The Hostile/Confrontational Type – wants to give an opening statement in the first caucus to show his or her clients what a great advocate he or she is and how he or she can get in the face of the other side.

· The “I Cannot Work in this Process” Type – just does not understand the process and how one must engage in the “give-and-take” of negotiations. It is a compromise, but this type does not understand that.

· The “Close to the Vest” Type – wants to keep everything confidential; will not exchange mediation statements. For some reason, believes that exploring the issues is harmful.

· The “Unprepared” Type – just is not ready, and may simply be looking for a way to resolve the case and earn a fee, rather than work the case up.

· The “Unrealistic” Type – for many reasons, including lack of preparation or ability to evaluate a case, does not understand the issues or damages; or simply has an highly inflated view of the value or a very low deflated view of the exposure of the client.

· The “Doesn’t Understand the Case” Type – here there is a lack of legal analytical skills and an understanding of what the case is about – legally and not emotionally, usually is the problem.

· The “I Get Frustrated with the Process” Type – has a hard time with the process of “give-and-take” because of impatience, and also lacks a sense of how to move through the process and engage the other side in the negotiation process.

· The “I am Trying to Get the Case Cheap” Type – this applies to the insurance company that believes if it goes to mediation, it will get a “good deal,” and that its representatives are attending a “fire sale,” not a real supervised negotiation. Carriers often approach early mediation this way, rather than taking a serious look at the carriers “down the line” costs plus exposure. Often an insurer will not spend the money to allow its counsel, panel counsel, or coverage counsel to evaluate the case in the real light of day.

You probably can describe others, but each of these represents an impediment to the process, frustrates the other parties and mediator, and simply stands in the way of resolution. For the most part these are “negative” personality types that make it difficult to resolve a case. Those who are not successful in either the negotiation or mediation process most likely exhibit traits of one or more of these types of lawyers in the negotiation setting.

The more positive personality types include:

· The “I Understand the Process and Can Work in It” Type – they know how it all works. Their clients are ready to make decisions and they have provided both the mediator and other side with a solid, well organized statement of the case.

· The “Diplomatic” Type – can present the case forcefully in the calm environment of negotiation process.

· The “I Will be Up Front” Type – “Candor are a lovely virtue.”

· The “Well Prepared” Type – refreshingly well versed in all phases of the case. Could start trial shortly because he or she knows the case.

· The “I Understand the Value of My Client’s Case” Type – realistic about the cost of going to trial vs. settlement; knows the verdict ranges; understands the “present value” of money; has let the client know what the financial benefits are of settlement at this time.

The successful negotiators present a combination of these positive traits. There may be occasional lapses where each of us exhibits one or more of the negative traits during the negotiation process. However, the successful negotiators are aware when these lapses occur, recognize them, and return to exhibiting the positive ones that improve the chances for resolution.

A major problem is presented when we have an adversary who truly falls into the negative personality types and is stuck there. My experience is that usually this type is reluctant to go to mediation; but if it happens, then you need to have a very candid discussion with the mediator beforehand to discuss how to approach the mediation. It may be that the mediator has to exercise some strong influence on your adversary and his or her client to assess how to approach the mediation process.

Using Videos at Mediation

Using videos at a mediation can be an excellent supplement to a mediation statement. It is a great way to provide the visual information that your adversaries and the mediator need to evaluate the case. Over the past several years, I have submitted a confidential mediation video in at least 75% of the cases I have taken to mediation. Personal injury cases are especially susceptible to the use of a video. It is an excellent way to tell your client’s story. We seldom go to mediation without a video in serious injury or wrongful death cases.

We have had two highway wrongful death cases go to mediation in the last few months. We used videos in both, and they both settled for top value. Both involved defendants who were governmental entities. Here is how we approached each with video.

Case No. 1: This was a case by a 42 year-old widow with no children whose husband, a law firm accounting employee, was killed when a teenager driving his parents’ Mercedes was speeding down a roadway that had a history of cross-over accidents. Because of infighting between a County and City, separate governmental entities, a four lane expressway running for about 2.5 miles between two main streets in San Mateo County, California had no raised median barrier. After a death case a few years ago, a partial six foot raised median barrier was installed but only over about 25% of the roadway. Then our client’s husband was killed when the recently licensed teenager missed a curve on an unlighted section of the road. Fortunately his parents had liability coverage of $1.5 Million, but the case was worth more.

After a period of aggressive discovery during which we uncovered more details about the infighting over who was going to pay for the remainder of the barrier, we scheduled a mediation. Our video contained:

· An introduction to our client and her husband with compelling photos of them at their wedding, on vacation, with family and friends;

· A segment from a news broadcast showing the accident scene;

· Photos of the cars in position after the accident;

· A computer reenactment of the accident demonstrating the speed of the teenager’s car, and also providing evidence that a raised median barrier would have still prevented the head-on collision;

· A video of the roadway before the accident;

· Photos of the barrier being completed over the entire segment of the roadway a few months after our client’s husband was killed; and

· More compelling photos of our client, her husband and family.

We were careful not to oversell the message here: Could this accident have been prevented? Should it have been prevented? The video told the story. The case settled with the County, who essentially controlled whether the barrier would be built and was the impediment to it not being fully completed before our client’s husband was killed, paying a significant amount to complete the global settlement.

Case No. 2: The second death case was more difficult. An errant driver who was likely having difficulties from insulin insufficiency crossed over on the upward side of a hill trying to pass two vehicles. Clearly he was negligent. He struck a vehicle being driven by the 25 year-old Filipino daughter of our clients. The decedent lived at home with her parents and her sister, who was younger and a student at the University of California at Davis. She was beautiful inside and out, as was her sister. The family was extremely close following the cultural pattern of her heritage.

The problem was the driver had 15/30 coverage. The State of California maintained the road which was an old farm road that had been repaved and redone in a patchwork manner. Over the years it became a major thoroughfare between Interstate 80 and Central California. Despite the heavy increase in traffic, and some major accidents, it was not improved the way it should have been. The stretch where our clients’ daughter was killed was particularly dangerous because of a series of hills that impeded drivers going in her direction from having a line of sight for oncoming vehicles, and also because of raised areas along her right that prevented her from escaping safely off the roadway should a car come as the driver’s car did. The decedent was essentially trapped in this area, with no way to see far enough ahead and no where to go if she could see a vehicle coming toward in the wrong lane of traffic.

But there was another problem. We had little in the way of economic damages. Under the California rules (resulting from Proposition 51 passed in 1986; Cal. Civ. Code sec. 1431.2), a defendant at fault is responsible jointly for all economic damages. However, for non-economic damages, a defendant is responsible only for that portion of these damages that is equivalent to its percentage of fault. The State argued for either no liability or a small percentage fault, which would keep the verdict low.

Our video contained segments showing:

· The heavy flow of traffic on the segment of road where the decedent was killed (at 7 a.m. in the morning during “commute” hours);

· Photos of the accident area, and the vehicles (we chose the less grizzly ones; indeed there were some that were gruesome);

· A series of videos showing the path of each vehicle which clearly demonstrate the lack of visibility on the approach to four hills in sequence, and the high bank on the driver’s right preventing any exit of the roadway even if she saw a vehicle in time to try to avoid it; the “trap” was clear;

· An interview of the decedent’s cousin about the family relationship and the close knit family unit that this Filipino family enjoyed;

· An interview of the decedent’s sister showing again the close family relationship; and

· Various family photos from vacations and holidays.

I should add here that the interviews of the family members were outstanding. Both the cousin and sister were compelling – genuine, intelligent, completely credible, and appropriately emotional at the right time. They would have been outstanding witnesses at trial. Even the State’s counsel openly conceded at mediation that we had an excellent non-economic case after he saw the video. He had taken the depositions of the parents, but he had not really touched on the relationship issues as much as we had hoped. We had to bring the evidence on this issue to him.

This case also settled on the strength of the video, plus one our of experts on highway design attended the mediation with outstanding drawings showing the configuration of this old farm road and how it had only been paved but not altered to avoid the dangerous condition that was created by the grades and configuration of the hills in the area where our clients’ daughter was killed.

I have other examples of how video has supplemented our mediation statements and other parts of our mediation presentation. Personal injury and death cases are good cases for visual information. Medical cases often lend themselves to video presentations. I often get a treating physician to do an overview of the medical issues with charts, models or other illustrations to supplement the written medical presentation. Strong visual stimuli will assist in supporting your written presentation.

I usually try to keep them no more than 60 minutes. In fact, I often tell my attorneys and staff to keep it to a “classroom hour,” if they can.

We also always put appropriate titles on the video and put a statement such as the following at the beginning and end: “This video presentation has been prepared for this mediation and is intended to be a confidential mediation video for the negotiations under the supervision of [mediator] on [date].” Sometimes I cite to the statutory or court rules protecting this information.

Pictures are definitely worth many words here, and are a great supplement to a well organized and comprehensive mediation statement.

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