Mediation Stuff – John Lassey's ADR Web Log

The “Old Boy Network”*

noreply@blogger.com (John Lassey) — Thu, 04 Feb 2010 10:51:00 +0000

Although originally used to describe alumni of the same British boys’ school, these days the term "Old Boy Network" commonly means any group more or less loosely tied together by social or professional relationships, so that the aims of its members may be furthered by informal arrangements, accommodation, and short cuts, rather than by strict adherence to the rules. For example, many would regard barristers or trial lawyers who practice in a small geographic area as likely members of an old boy network.

In most quarters, the concept has come into disrepute — particularly when applied to lawyers — because it conjures up visions of backroom transactions aimed at making life easier for the lawyers, as opposed to benefitting their clients. In one episode of John Mortimer’s classic Rumpole of the Bailey series, for example, newly minted barrister, Ms. Liz Probert, introduces herself and, extending her right hand, announces that she has just passed the bar exam. Rumpole admonishes her, saying: "Ah, then we don’t shake hands. The customers don’t like it, you see. They may think we’re making secret deals."†

Obviously, the network can be used to undermine the safeguards of the Rules of Professional Conduct designed to assure that the clients’ interests are paramount. Unscrupulous (or lazy) lawyers have been known to sell their clients down the river for the sake of a quick deal. But despite abuses by some, the informality of the network has too much going for it to be discouraged completely.

If you think about it, the Old Boy Network of trial lawyers, judges and dispute resolution professionals is what, more often than not, facilitates successful mediations. Mutually beneficial settlements are achieved by lawyers who know and respect each other far more often than by lawyers who distrust each other. In fact, I believe that arranging for mediation in the first place can best be accomplished when the lawyers for the litigants grease the wheels in advance by speaking frankly with each other "off the record." President Obama was right; a lot more can be accomplished over a beer than by exchanging bombastic letters or pleadings.

In my view, the best way to avoid the appearance of impropriety, while retaining the benefits of cordial professional relationships, is to be up front with your clients right from the beginning about the need for informality and civility with the other side. If your jurisdiction encourages such behavior,‡ stress that fact with them and be ready to discuss examples illustrating how people generally catch more flies with honey than with vinegar. Keep your clients abreast of the gist — if not the full details — of communications with your opponents; and be prepared to explain how such informality is likely to pay dividends in the long run.

As someone must have once said: "Being an effective advocate doesn’t mean you have to be a jackass!"**

* The photo was selected purposely to illustrate that the "Old Boy Network" is no longer an all-male enclave.

† Rumpole and the Blind Tasting, Roger Bamford, Director (Thames Television, Ltd., 1987).

‡ See, e.g., The New Hampshire Bar Association Litigation Guidelines (N.H.B.A., 1999) .

** If nobody admits to originating the quote in 30 days, I’ll claim it!

I’m OK; You’re Irrelevant

noreply@blogger.com (John Lassey) — Thu, 28 Jan 2010 14:30:00 +0000

In negotiation — whether mediated or not — we all like to win. See, e.g., "Fear of Being Outfoxed," posted December 24, 2009. Of course, if a settlement can be structured so that both sides win, so much the better. Unfortunately, however, "win-win" solutions are not always possible in personal injury cases, at least not in the classic sense envisioned by Fisher and Ury.* No matter how much the plaintiff and the defendant in an auto accident case, say, would like to turn the clock back and undo the accident, it isn’t going to happen.

Obviously, in one sense, both sides must benefit from any settlement. Each party must believe that paying or accepting the money on the table is better than not doing so, else they would not have agreed to the deal. But this benefit depends upon the coercive power of a future event that nobody wanted in the first place — a trial.

In the negotiation of personal injury litigation, nobody is likely to win in the sense that a settlement will make them better off than they were before the accident. The plaintiff will still have the injury; the insurance company’s bank balance will be lower after it indemnifies the defendant; and the defendant will likely see his or her premiums go up. In accident litigation, when life has given you those kinds of lemons, it’s usually too late to make lemonade.

Or is it? Let’s focus on plaintiffs. Injured plaintiffs can win by settling, but only when they fully understand that winning isn’t about undoing the harm, but instead is about giving them the opportunity to overcome the harm. Money won’t heal a permanent injury, but it will often open doors that were closed before. Winning in this way requires a change in mind set. The injured plaintiff must shift focus away from how much he or she has been wronged and, instead, concentrate on what it will take to overcome the consequences of the wrong. As I wrote in my last post of 2009: "The past has passed; the future beckons."

So long as the plaintiff’s attitude is "They’ll have to pay for what they did to me!" victory will be elusive. "They" are unlikely to ever pay much. Instead, it will likely be "They’s" insurance company that foots the bill. The plaintiffs who win are the ones who ultimately let go of their anger — or at least keep it well under control. The winners keep their eyes on the prize, focus on what’s good for them, quit worrying about what’s bad for the other guy, and look to the future.

* Getting to Yes: Negotiating Agreement Without Giving In (Boston: Houghton Mifflin Co., 1981).

Musings on Justice and Truth

noreply@blogger.com (John Lassey) — Thu, 21 Jan 2010 13:36:00 +0000

It is accepted more or less universally that plaintiffs in tort litigation seek not only money, but also justice. I also believe that to be true — as far as it goes. Based on my experience, however, I suspect that many folks are operating on only a vaguely formed understanding of what the word "justice" really means. I daresay that many, if not most, believe deep down that justice is what happens when the jury renders a verdict in their favor! If, instead, the jury finds for the other guy, it is likely the result of some injustice. The jury was biased or stupid, e.g., or the other side had more bucks to hire a fancy lawyer, etc. More often than not, however, the jurors found for the other guy because they liked his or her notion of justice better, based on what they saw and heard at trial. Few realize that justice is more about the process than the result.

Herewith, my definition of the word: "Justice" is that which results when the procedure is correctly followed. So long as the rules of evidence are followed, the judge is not biased (or asleep), and the jury follows instructions and is not suborned, the result, by definition, must be just — or, at least, cannot be determined by outsiders to have been unjust. This means that if the jury hears and sees only what goes onto Justitia’s scales (see picture) and follows a reasonable understanding of the judge’s instructions, the result is "justice," whether or not some other jury faced with the same evidence and instruction might have come to a different conclusion.

I would venture to say that most citizens — including many trial lawyers who ought to have known better — were outraged in 1995 when O. J. Simpson was acquitted of murdering his ex-wife and Ronald Goldman. After all, the TV news shows were predicting a conviction! Trials, however, whether criminal or civil, are decided by juries, not by John Q. Public (a/k/a, in some circles, the "Mob"). Juries are, of course, human and subject to human frailties. Society can’t guarantee that juries will always find the truth. On the other hand, who is to say that a given jury has not found the truth? John Q. Public? The losing attorney? The anchor on the six o’clock news? Bishop Desmond Tutu? In our society, we have juries because truth is almost never knowable with any certainty. Like it or not, we have assigned the role of "truth and justice finder" to juries. And that means that whatever they decide when the procedure has been followed is, for all practical purposes, truth and justice.

So, what am I getting at that would be of use to tort litigants participating in mediation? It is this: the less one understands about the true meaning of "justice," the longer it will take to reach a reasonable resolution acceptable to all participants. One of a trial lawyer’s primary jobs is to educate his or her client on the limitations of the system, and thus, the true meaning of "justice." Clients may think they have a can’t-miss-slam-dunk case, but they need to comprehend that what counts is how 12 strangers, who will see and hear only what the judge tells them they can, might look at the case. Clients need to understand that they cannot profitably confuse what they think ought to be with what is.

That’s Not My Department

noreply@blogger.com (John Lassey) — Thu, 14 Jan 2010 12:56:00 +0000

Too often, tort litigators focus on how to win their case at trial, while ignoring opportunities to reach settlement by educating themselves about the other side’s motivation and readiness.

What is needed, in my view, is a more holistic approach, such as that discussed about a year ago by John DeGroote over at Settlement Perspectives. John started an excellent series of posts on the subject of Early Case Assessment ("ECA"). For John, "the definition of an ‘Early Case Assessment program’ is a disciplined, proactive case management approach designed to assemble, within 60 days, enough of the facts, law, and other information relevant to a dispute to evaluate the matter, to develop a litigation strategy, and to formulate a settlement plan if appropriate." See "Easier Said Than Done: Early Case Assessments Part I," posted October 22, 2008. John’s point is that many cases can be assessed and disposed of at an early stage by following a concentrated, structured approach to gain essential information quickly.

One of the points John makes is that to gain the greatest advantage from an ECA program, your team’s focus must be external, as well as internal, and include an analysis of the case from the other side’s point of view. By taking this approach, "[y]ou’ll know more about what your dispute is worth to the other side, and you’ll be in a better position to get there at every step in the process." See e.g., "Better Settlements From Better Information: Early Case Assessments IV," posted November 7, 2008.

Most tort litigators are quite skillful at winkling out information regarding the strength of the other side’s case. Over the years they have perfected their discovery techniques and their checklists so as to learn everything they need to know about the facts of a case and what a jury might do with them.

Fear of what a jury might do with a given set of facts may be the primary motivation to settle a tort case, but there is often quite a bit more that ought to be considered.

Where many litigators tend to be lax is in learning what kinds of things other than the strengths and weaknesses of the case at hand are likely to motivate the other side to settle. What the plaintiff may need money for, e.g., may sometimes be touched upon by the defense, but there usually isn’t a concerted effort made to get detailed information on the subject. Likewise, the defense is not usually proactive in exploring the chances that liens on the proceeds of a future settlement may be compromised. Such matters are normally regarded as the responsibility of the plaintiff.

Conversely, matters such as the size of the defense carrier’s current caseload in its local office, or plans regarding consolidation of claims offices probably won’t be on the plaintiff’s radar screen, even though they may have a substantial bearing on the company’s motivation to settle.

To maximize chances of settlement, all counsel involved in litigation should not only ensure that their side has all of its ducks in a row before mediation, but should also be proactive in addressing the other side’s readiness as well. Settlement is everybody’s department.

The Babysitter Factor

noreply@blogger.com (John Lassey) — Thu, 07 Jan 2010 11:16:00 +0000

I’m going to start the new year with a story from my early years as a trial lawyer. It’s one of my favorites because, although the facts are quite unusual, the story is instructive of the need to keep an open mind about absolutely everything when looking for opportunities to resolve a case.

About 20 years ago, I was retained by a liability insurance carrier to defend a nuisance claim brought against a local manufacturing company located in a small "mill town" in New Hampshire. The company had been around since the early 19th Century, and had been owned by the same family for about 75 years. For much of its existence, it had been the dominant player in the town’s economy. In fact, it was in operation before there was a town. For the last few years prior to the lawsuit, the company had been run by its dynamic, twenty-something president, a scion of the owning family who had undertaken a modernization program designed to keep the company competitive well into the 21st Century.

For years prior to the lawsuit, a large vacant lot owned by the company had served as a buffer between the factory and a small residential neighborhood. However, the company had recently built a large addition that completely filled the lot and extended right up to the street across from two small houses. Although the expansion did not run afoul of any zoning requirements, the owners of the two houses filed an action for injunction and money damages, claiming that the expanded factory constituted a legal nuisance.

One of the plaintiffs was a former employee of the company who had left involuntarily, and who arguably had an axe to grind. The second plaintiff was an elderly woman who lived alone next door to the first. The primary claim of nuisance was that the machinery in the new facility caused excessive and intolerable vibration and noise. There were other less specific claims, but the vibration issue kept the "lesser" claims off of everyone’s radar screen. The former employee and his attorney took the lead in discovery; the elderly neighbor remained rather passive.

The main issue of concern to the company was the request for an injunction, which, if imposed, would not have been covered by its insurance policy. For that reason, the company’s own corporate attorney defended along with me and took an active role in the trial preparation.

Early in the discovery phase, we arranged to visit the plaintiffs’ properties on a day when all the machinery in the new building was running full blast. As our client’s people had predicted, we were able to stand directly across from the factory on the plaintiffs’ front porches and could, almost literally, hear the grass grow. There was no vibration to speak of, and noise was minimal. We felt confident that the presiding judge would throw the case out of court.

The company president turned the case preparation over to the attorneys and his risk management people, but we were able to prevail upon him to represent the company in person at trial. The first witness called by the plaintiffs was the elderly woman. As she testified, it became apparent that the minor noise and vibration of the machinery didn’t concern her nearly as much as the delivery trucks that tended to arrive and leave in the early hours of the morning. After listening to her testimony for a few minutes, the young president leaned over to us and whispered: "She used to be our babysitter when we were kids. We ought to be able to do better for her!" We asked the judge for a recess and negotiated a settlement within the next hour or so.

Happy New Year!

noreply@blogger.com (John Lassey) — Thu, 31 Dec 2009 15:24:00 +0000

I don’t usually tie my posts to special events or holidays, but I think that celebration of the new year is particularly appropriate for dispute resolution professionals. It is a time to acknowledge the inevitability of change. The old year is gone; the new year is bright with promise. The past has passed; the future beckons.

This is not to suggest, of course, that what has gone before has no bearing on what is to come. As Santayana taught us: "Those who cannot remember the past are condemned to repeat it."* Civil litigants, though, must find a way to put the past behind them; to let go of grievances, whether real or imagined, and go forward. While the past must instruct the future, it shouldn’t control it.

People generally sue other people because they perceive themselves to have been wounded — sometimes literally, sometimes figuratively. Resolution won’t happen until those wounds are dealt with in some fashion. An essential step in dealing with wounds, however, is to recognize that they cannot be undone, or even fully healed. All that can be accomplished is to prevent the wounds from becoming more infected.

"Time," as someone once said, "marches on." You don’t have to forget; you don’t have to forgive; but you do have to move on. People cannot control what has happened, but they can and should control what will happen — because it is inevitable that something will.

* George Santayana, The Life of Reason, Vol. 1, Reason in Common Sense, (Dover Publications edition, 1980; originally published by Charles Scribner & Sons, 1905).

Fear of Being Outfoxed

noreply@blogger.com (John Lassey) — Thu, 24 Dec 2009 12:44:00 +0000

"Everybody has to save face, and, whether they have to or not, everyone tries to; it’s one of the basic compulsions of men." John D. Voelker, writing as Robert Traver, Anatomy of a Murder (New York: St. Martin’s Press, 1958), 42.

The above-quoted maxim is especially accurate when it comes to lawyers, and even more so when it comes to trial lawyers. Put simply, trial lawyers hate to lose. They are usually willing to moderate their thirst for victory enough to participate in settlement negotiations, but, when the dust settles, they still like to feel they won by doing better for their clients than the other lawyers did for theirs.

In saying this, I do not mean to suggest that it’s all gamesmanship — i.e., the lawyer who dies with the most points wins — or that we trial lawyers are completely driven by our egos. Of course, given Voelker’s observation, there is always going to be some of that. After all, no lawyer worth his or her salt wants to be snookered. But more important than ego to most lawyers is that our clients hire us to get the best results we can. If we take our clients’ money, we’re expected to advocate.

What’s important to most litigants involved in settlement negotiations, assuming the numbers being discussed are in the so-called "zone of possible agreement" (ZOPA),* is knowing that the other side’s best number has been reached. This is why the cautious back and forth negotiation that we call the "mediation dance" happens, and why most people rarely "cut to the chase" right away. The dance is a necessary component in just about all settlement negotiations. Can you imagine two trial lawyers having the following conversation?
Defense Attorney: My client and I think settlement value is between 200 and 250 thousand dollars.

Plaintiff’s Attorney: That’s about where I put it. Want to split the difference at 225?

Whatever the cause of people’s tendency to hide their hole cards, it’s all part of the adversarial process. It has been with us for centuries, and is likely to be with us well into the future, if not forever. It is one of the reasons why it’s wise for parties contemplating mediation to allow for as much time as possible for the process. I have been in mediations where early negotiation results in substantial movement, but hours are spent thereafter in making only tiny incremental changes. Was such extra time wasted? I don’t think so, because when that sort of thing happens, everyone is virtually certain that the other side has reached the end of its rope — and is satisfied that nobody was outfoxed.

* Defined as "the set of all possible deals that would be acceptable to both parties." Deepak Malhotra & Max H. Bazerman, Negotiation Genius, (New York: Bantam Dell, 2007), 23.

Impasse

noreply@blogger.com (John Lassey) — Thu, 17 Dec 2009 11:37:00 +0000

We’ve all seen it. The parties negotiate back and forth all day, only to bog down in the late afternoon, leaving a sizeable gap between demand and offer. All sides announce that they have gone as far as they can and look to the mediator to figure out a way to reach resolution despite the frozen state of negotiations. Sometimes a good mediator can help find a way to create some additional value to bridge the gap. Unfortunately, though, all too often the parties are not looking for ways to close the gap; instead, their view of the mediator’s job is to make the other side see things their way! When the parties feel like this, the result is called "impasse," a/k/a "a predicament affording no obvious escape."*

True impasse comes about because each party believes it is correct in its analyses. The difference usually arises because there are pieces of the puzzle that haven’t yet been found or, if found, have not been fully understood.

John DeGroote, in his Settlement Perspectives web log, observed: "If you and the other side value the case differently, at least one of you is wrong." See John’s November 7, 2008, post entitled "Better Settlements From Better Information: Early Case Assessments IV." Of course, if the only unknown is what the result of a trial will be sometime in the future, you won’t find out for sure who is wrong until the proverbial "twelve [people] good and true" have rendered their verdict. However, since the parties decided at one point to mediate, I will hopefully be pardoned for assuming that they want to avoid that particular risk.†

On the other hand, if pieces to the puzzle are missing because discovery is incomplete, the parties and the mediator may want to consider adjourning and returning later after gathering further information. But the best way through impasse to resolution may not always be to complete the requisite discovery. Discovery costs money, so deciding whether to go ahead with it will require a cost-benefit analysis: is the cost of finding those additional puzzle pieces justified by the amount of money still at stake? And bear in mind that the parties might end up spending the money only to learn that they were both wrong or the results are still inconclusive.

Often the best way through impasse is to simply bite the bullet, recognize that you have pushed the other side as far as you can, split the difference in some fashion, and go home.

* Merriam-Webster Online, accessed December 11, 2009.

† See "Jury Prognostication," posted October 15, 2009.

When Not to Mediate

noreply@blogger.com (John Lassey) — Thu, 10 Dec 2009 12:31:00 +0000

I am a strong advocate of settlement. Like Lincoln, I believe that lawyers are at their best when they are advising their clients to make peace.* Having said this, I also understand that peace is not always an option. For true peace to be possible, the parties must want it to be the outcome. If either party — whether plaintiff or defendant — comes to the table with an unshakeable demand for unconditional surrender, there is usually no point in coming to the table at all. See, e.g., "We Got ‘Em Cornered!" posted July 11, 2009.

I know, I know; sometimes such a hard-ball attitude may simply be a ploy, and a skilled mediator may be able to help the parties achieve agreement despite such initial posturing. What I’m talking about, however, are the occasional cases where there is no ploy — i.e., when the "no prisoners" approach is genuine. In such cases, it is unlikely that even the best mediator will be able to truly convince the recalcitrant parties to bend, so it is usually better for the folks who want war to simply say so, and decline to mediate.

This is so because an agreement to mediate a tort case usually implies a willingness by all to compromise to some extent. Therefore, the participants usually expect that the others: (a) want to settle; and (b) are willing bend at least a little in order to accomplish (a). Most people, after going to the trouble of preparing for mediation, tend to react unpleasantly when they show up ready to negotiate only to discover that the others are not. This usually results in more than just a waste of time, because the offended parties can be expected to redouble their efforts to prepare for trial and may end any hope, albeit flickering, of a mutually satisfactory settlement later on. This is one of the reasons I am opposed to mediation being required by the courts. See "Should Mediation be Mandatory?" posted May 17, 2008.

Of course, one doesn’t always know whether a refusal to mediate is itself just another ploy. Many hard-nosed negotiators hold firmly to the belief that you don’t reach agreement without saying "BOO!" at least once. See, e.g., "Driving in Germany" posted June 7, 2008. If you suspect that your opponent’s refusal to participate in mediation is mostly gamesmanship, you might consider unilaterally hiring a mediator to approach the other side and do an independent assessment of the situation before you abandon the effort.

If, however, it is apparent after such efforts that the other side won’t negotiate, don’t keep pushing. Instead, make sure your opponent has your phone number in case he or she has a change of heart, then continue with your trial preparation.

* See The Collected Works of Abraham Lincoln, edited by Roy P. Basler, Volume II, "Notes for a Law Lecture" (July 1, 1850?), p. 81.

Multi-Party Mediation

noreply@blogger.com (John Lassey) — Thu, 03 Dec 2009 14:02:00 +0000

One on one mediation — that is, one plaintiff versus one defendant — is familiar to most trial attorneys. Depending on the complexity of the facts and the legal issues involved, such mediations can be difficult or easy, but they usually involve a fairly simple concept: the two parties either ultimately agree on the relative responsibility and value or they do not.

The complexities may increase exponentially when more than two parties are involved. In multi-defendant cases, for instance, the principal difficulties may involve the plaintiff (or plaintiffs) very little, if at all. Often, the defendants will come to a basic agreement concerning the total settlement value of the plaintiff’s case, but disagree strenuously on how that amount should be divided among them. In catastrophic injury cases, differing levels of available coverage, both primary and excess, add further complexity to the mix. A carrier with relatively low primary limits insuring a defendant with only marginal liability, for example, may find itself pressured into paying more than it thinks it ought to by an excess carrier that is also the primary carrier for one of the other defendants!

One technique used in cases with multiple defendants is to gather them together for a preliminary session (or sessions) in advance of the mediation in chief. Sometimes the same mediator may be used for all sessions; sometimes not. The object of this pre-mediation, if you will, is to see how much agreement may be achieved among the defendants without forcing the plaintiffs to sit cooling their heels for hours while the people with the money wrangle among themselves. For an example of a technique that has been used with some success to accomplish such agreement, see Jeff Kichaven’s discussion of the so-called "Surowiecki Ballot" in his October 2008 article entitled "A Tool for Multi-Party Insurance Litigation Mediation with ‘Additional Insureds’." Hopefully, by the time of the main event, the defendants will be prepared (up to a point) to work together in a common cause.

Sometimes, the defendants never reach agreement on the percentage each will be willing to make. If that happens, another technique is for the mediator to meet separately with each defendant and obtain the best offer each is willing to make. At the end of this exercise, the mediator then discloses the total package available from all defendants, but does not disclose the individual contributions each has authorized. Having obtained total authority from the defendants, the mediator will then meet with the plaintiff — or plaintiffs, if more than one — and determine if settlement is possible within the authority given. Of course, if it isn’t enough, step one may have to be repeated.

If, after all is said and done, the mediator cannot get substantial commitment from all of the defendants, he or she can explore whether the plaintiff(s) may or may not be willing to settle separately with some of the defendants, while continuing to pursue the others.

As a last ditch effort to achieve at least a partial settlement, the mediator may seek preliminary contributions from the defendants sufficient to settle with the plaintiff(s), with the defendants agreeing to resolve their final contributions through separate arbitration (or litigation) among themselves. This course of action has the advantage of capping the total amount to be paid to the plaintiff(s), thus protecting the defendants from the consequences of a runaway verdict, while allowing them to fully litigate their final contribution percentage vis a vis each other.

Bombs, Wild Cards, the Boogeyman and Other Things That Go “Bump” in the Night

noreply@blogger.com (John Lassey) — Thu, 26 Nov 2009 10:56:00 +0000

Liability insurance carriers normally have a huge bargaining advantage in personal injury negotiations as compared to personal injury plaintiffs. The reason? Carriers have lots of cases; plaintiffs have just one. Carriers, i.e., can usually afford to lose. Plaintiffs often cannot. Put another way, Plaintiffs typically need to be paid more than carriers need to pay.

Insurance companies are in the risk business, so taking chances is their bread and butter. Of course, all risk is relative. Where the case at hand is fairly routine — a rear-ender whiplash case, e.g. — the company is likely to have a lot of data to back their analysis. In such cases, the risk of an adverse result to the company can be calculated fairly accurately, intensifying its advantage over a lone plaintiff.

The company’s advantage lessens, however, the more unusual the facts are. The more unknowns in a case, the less sure of their ground the company representatives are. Their normal advantage is based on statistics and the laws of probability. Statistics are more reliable as predictors when the applicable database is large, and less reliable when the database is small. Thus, it is normally to a plaintiff’s advantage to structure his or her case so that it falls outside the routine as much as possible.

Explosive facts take a case even more out of the routine. The carriers’ ability to calculate risk is far more difficult with facts that have a high potential for angering members of the jury. A manufacturer’s failure to spend a few bucks to correct a dangerous product design, for example, is particularly hard to price. In cases involving sexual assault against minors, statistics likewise don’t provide a lot of help to a defendant. Even relatively routine cases can quickly turn into problems for insurance companies if some of the defense witnesses tend to be arrogant, are caught lying, altering records, etc.

A word of caution, however. Smoking guns can be two-way streets.* It is possible to be so successful in uncovering or developing egregious facts that the carrier becomes justified in denying coverage. Liability coverage will be excluded, for example, if the defendant’s actions triggered the typical intentional act exclusion.

* How’s that for mixing metaphors?

Underestimating Your Opponents

noreply@blogger.com (John Lassey) — Thu, 19 Nov 2009 12:16:00 +0000

"There are not Indians enough in the country to whip the Seventh Cavalry!" George Armstrong Custer

Custer made the above-quoted statement eight years before the Battle of the Little Bighorn. The photo at the left illustrates the perils of such bravado.

For trial lawyers, it’s easy to get caught up in the adrenaline rush that usually occurs shortly before trial. The witnesses have been lined up, the trial team has marshaled all the facts and legal arguments, and the lawyers are eager to bring all of their months of effort to fruition. "We are, by God, ready! Bring on the trial!"

Confidence in one’s abilities is, of course, as necessary a trait in trial lawyers as it is in surgeons. Just as patients don’t hire surgeons who faint at the sight of blood, neither do clients have confidence in lawyers who shy away from the courtroom.

But too much confidence can overcome good sense. Leaving settlement discussions to the last minute can cause even the best and most cautious lawyer to overestimate the strength of his or her case and to underestimate the strength of the opponent’s case. This is one of the reasons — in addition to saving costs of trial prep — why serious settlement discussions should be planned for a time well in advance of trial.

From the beginning of a case, the lawyers should be planning for resolution in addition to trial. Discovery should be programmed in advance so that enough information to make settlement negotiations meaningful is expected to be known months before the combatants immerse themselves in final preparation.

But even with the best planning, things have a way of coming out differently than originally anticipated. If it is impossible to mediate a case until the eve of trial, the parties should consider engaging the services of separate settlement counsel to conduct the negotiations. It is usually much easier for such counsel to see things objectively than it is for trial counsel, a/k/a, the people who are more likely to be saying: "Bring on the Indians!"

Maginot Lines in the Sand

noreply@blogger.com (John Lassey) — Thu, 12 Nov 2009 10:35:00 +0000

The French Maginot Line, a series of impressive fortifications running from Switzerland to Belgium, was conceived in the 1920s and built in the 30s as a defense against possible German invasion. The concept was seen as an improvement over the trench warfare which typified so much of the military experience during World War I from 1914 to 1918. The fortification plan was not thrown together in a slap-dash manner; rather, it was well thought-out by some of the more experienced military minds in France. Nonetheless, with the benefit of hindsight, we all know now that the plan completely failed to deter the German Wehrmacht, which had abandoned such obsolete forms of warfare in favor of a mobile, armor-based attack strategy.

In defense of the French planners, much of the work on the Line was done before Hitler’s massive rearmament during the mid to late 1930s; however, even after it should have been obvious that reliance on the Maginot line was obsolete, the French failed to modify their strategic planning. The Wehrmacht bypassed the Maginot Line, swept through Belgium (again),* and forced France to seek terms about a month later.

The lesson in all this for tort litigators is to avoid becoming too "entrenched" in one’s own plans and calculations, regardless of how well thought-out they may have been. It’s OK — in fact, highly desirable — to come to mediation having strategized about how much you want to get (or spend) to settle your case. But do not draw your line in the sand so deeply that you fail to appreciate risks that become apparent during the mediation. You may miss an opportunity to achieve a settlement that, while not exactly measuring up to your expectations, is nonetheless reasonable.

As I pointed out a few weeks ago, nobody can predict with any precision what is going to happen after a jury starts its deliberations. See "Jury Prognostication," posted October 15, 2009. Rather than basing your side’s "bottom line" on what you believe a jury is likely to award, think of it instead as an amount for which the case ought to settle now. There is a big difference between the two approaches: the first requires a prediction about what 12 strangers are likely to do at some time hence; the second, a prediction about what the people across the table are likely to do now — perhaps based on their fear of what a jury may do at some time hence.

If your original prediction about what it will take to settle is proved wrong at the mediation, it is unwise to walk away from the negotiations without first pausing to rethink your original analysis. Nine times out of ten, if the parties are close — but not close enough — it is best for everybody to take a deep breath, compromise a little more, and get the deal done.

* The Luftwaffe simply flew over the Line.

A Mediator’s Prayer

noreply@blogger.com (John Lassey) — Thu, 05 Nov 2009 11:45:00 +0000

Lord, grant me the imagination to think outside the box and the wisdom to keep from going off the rails. For the one fosters innovative solutions, while the other leads to train wrecks.

One of the benefits of experience — a/k/a learning from your mistakes — is that it helps you to tell the difference between the two. And one of the things I have learned from experience over the years is that new and "improved" approaches are not always appreciated. Stepping out of familiar territory into the unknown is generally perceived to be risky. People engaged in mediation who are charged with protecting other people’s money (e.g., attorneys and claims reps) are generally reluctant to do risky things with it. After all, they are usually trying to settle a case to avoid risk, not incur more!

For most lawyers, negotiating about money is familiar territory. In tort mediations it’s not always only about the money, but it usually is mostly about the money. Insurance claims reps are primarily interested in: (a) paying the plaintiff something (not too much, please); (b) stopping defense costs; and (c) closing the file. Plaintiffs’ attorneys are interested in: (a) getting a fair price for the case; (b) keeping time and expenses down; and (c) closing the file.

Injured plaintiffs look at things somewhat differently. They are, to be sure, interested in the same things as their attorneys, but they also desire a modicum of justice from the process. And it is this difference where the ability to think outside the box may be most useful. Depending on the strength of the desire for justice — which the liability carrier isn’t usually focused on — pure money negotiations may or may not be enough.

But if the negotiation is clearly one for "just money," too much emphasis on outside-the-box thinking may be counterproductive. If the mediator (perhaps out of boredom) tries to get too innovative, the participants may resent it as a distraction. Rather than moving the parties toward settlement, the mediator who gets too fancy risks discouraging everybody and causing the negotiation to end without a settlement.

On the other hand, when the parties have gone as far as they can go with money negotiations, that is when imagination can and should come into play. If there is a gap between "last and best offers," the mediator and the parties, rather than saying, "well, that’s it, then," packing up and going home, ought to explore things further, looking for ways to maximize value to one side, while minimizing costs to the other. Will a formal and public apology (as opposed to only vaguely expressed remorse) supply value to the plaintiff without costing the defense anything substantial? Will a structured settlement meet some of the plaintiff’s financial needs, while keeping the defense outlay within the budgeted parameters?* Will funding a health insurance policy allay the plaintiff’s fears of being without adequate medical care in the future?

Done right and at the right time, a little out-of-the box thinking can help achieve a settlement, while avoiding the "Casey Jones" syndrome.

* Consider the example in "Show Me the Money!" posted July 18, 2008.

Signals

noreply@blogger.com (John Lassey) — Thu, 29 Oct 2009 09:39:00 +0000

One of the buzz words in mediation and negotiation circles is "signals." In a tort mediation, after the parties and counsel split up and go into separate rooms, demands and offers are usually filtered through a "what kind of signal are we sending?" lens before they are presented to the other side.

Often — at least for the first couple of hours — the signal each side is trying to send is: "If you were smart, you’d be quaking in your boots; you really don’t want to mess with us!" This approach always reminds me of the inept motorcycle gang in the Clint Eastwood monkey movies ("We’re the Black Widows. We’re feared throughout the land").*

When it becomes obvious that the tough guy approach isn’t working, the parties and their lawyers usually start to moderate their tone and send more realistic signals designed to show a willingness to settle, but without appearing too eager to give away the store. The most common tactic is to give the impression of heading toward a number midway between the last demand and offer. For example, the defense is likely to respond to unreasonably high demands from the plaintiff’s side, with equally unreasonable offers until the plaintiff drops to a point where the mid point is perceived to be "in the ballpark." If the plaintiffs have been in the $250,000 range for a case perceived by the defense to be worth only $75,000 to $80,000, the other side is unlikely to make substantial moves until the demand gets down around $100,000.

One approach that has been used with some success to signal that it is time to get serious, is to make an offer contingent on the plaintiffs lowering their demand to a certain number. This has the advantage of getting the negotiations into the right range without necessarily forcing the defense to show their hole card. For instance, in the example discussed in the previous paragraph, the defense, instead of responding to the last demand with a firm offer, might instead counter by saying that if the demand is lowered to $90,000, the offer will be raised to $45,000. Such a move would likely be designed to signal a settlement range of $65,000 to $70,000. If the plaintiffs also believe that the case is worth $75,000 to $80,000, such a move may encourage them to respond with a demand — or even a suggested range of their own — designed to signal a desired settlement close to, but not quite, where they truly want to go — in the $85,000 to $90,000 range, say. Now the parties probably know that on the surface they are only about $10,000 apart, and it shouldn’t take much to close the remaining gap (which, in reality, is probably no gap at all).

* Any Which Way You Can, Buddy Van Horn, Director (Warner Brothers Pictures, 1980).

Preparing for Mediation

noreply@blogger.com (John Lassey) — Thu, 22 Oct 2009 11:01:00 +0000

I was reminded recently by my San Francisco colleague, Michael Carbone (Mediation Strategies Web Log), of the importance of thorough preparation prior to mediation. See "Effective Preparation," posted September 26, 2009. In that post, Michael reminds plaintiffs and their attorneys that "[i]f [they] will be negotiating with an insurance carrier or other institutional party who must complete an internal evaluation in advance of the mediation, be sure to provide them with all of the information that they will need."

This advice is especially important if there are factual disputes on the extent of damages or their causal relationship with the events giving rise to liability. Typically, such issues are going to be the subject of expert testimony — usually medical experts, in the case of personal injury — if the case doesn’t settle. Unless the Insurance carrier for the defendant is presented with hard and persuasive documentary evidence of what that testimony is going to be, expect the claims rep and defense counsel to negotiate on the basis that such evidence is unlikely to be forthcoming at trial.

Insurance carriers and defense attorneys know that you have the burden of proof on these issues, and they expect you to demonstrate how you plan to meet that burden before they will write a substantial check. See my post of September 3, 2009, entitled "Little Blank Spaces." Don’t expect to persuade the other side at mediation, e.g., that your client "probably" has a permanent disability caused by the accident at issue unless you have a medical expert’s opinion to back it up.

I know that doctors cost a lot of money and sometimes they are hard to deal with, etc., etc. I also know that in many cases, experienced counsel can guess pretty well from the medical records what the doctors are going to say about fairly routine injuries. And I know as well that it can be frustrating to have to pay several hundred bucks to get a doctor to put in writing what to you may seem obvious. But if you insist on avoiding that expense, be prepared to have the value of your client’s case discounted considerably by the other side. And your chances of changing their perception during the course of a mediation are slim indeed.

Jury Prognostication

noreply@blogger.com (John Lassey) — Thu, 15 Oct 2009 10:19:00 +0000

Experienced trial attorneys, in advancing their clients’ interests during mediation of tort cases, usually profess to having some ability to estimate what their cases are worth; i.e., figuring what a jury is likely to award and factoring in the cost of trying the case. Unfortunately, making such estimates usually involves trying to predict what twelve strangers — whose identities are not yet known, and whose innermost thoughts, attitudes and life experiences will never be fully known — will react as a group to the evidence that is likely to be presented at trial. In my state, all we know for sure at the time of mediation about the future members of the jury is that they will be at least 18 years old and will either have a driver’s license or be registered to vote.*

When I act as a mediator, I always remind the participants that there is no such thing as an "average jury." Even when a jury is made up of average citizens (whatever those might be), I maintain that it is impossible to accurately predict the group dynamics that will result from the mix of different personalities when they start their deliberations. Even on the eve of trial, when you know who is going to be on the jury, determining in advance who will be the leaders in the jury room, for example, is a pretty imprecise exercise.

The science of statistics, its practitioners will argue, does help to give some predictability to the art of jury divination. But statistics, as I have said before, favors litigants who have lots of cases — insurance companies, e.g. The science has little to offer someone who has only one bite at the apple — the plaintiff, i.e. Every poker player knows that someone who can go all night has the edge over the gambler who has only enough money to sit in for one hand!

The situation faced by litigants is complicated further by the advance of technology. I believe that in the Internet age — Google, Twitter, Facebook, etc. — the unpredictability of juries has increased significantly. Are jurors going to be persuaded by the evidence and arguments they hear in court, or by something one of them read on a blog that morning? Most jurors with whom I have had experience take their role seriously and try to do the right thing. Unfortunately, however, what a lay person may think is the right thing to do can differ significantly from what the judge and the lawyers think is the right thing to do.

The problem arises, in my view, not only from the vast increase in the availability and accessibility of information online, but from the empowering effect all of it has had on the general population. Take a recent example from a criminal trial in my state. One juror did an Internet search of the defendant’s name and learned of a past criminal record. He then shared the information with the rest of the jury "because he thought jurors deserved to know."† His foray into hyperspace was discovered, and he was found in contempt and punished. His attitude of "empowerment" is, I’m afraid, more prevalent than many might suppose, and his example, rather than discouraging such vigilante justice, may instead simply cause others to be more careful about discussing it afterward.

So, getting back to the original point, how are we to assess the probabilities of a favorable jury verdict? Maybe, when all is said and done, we can’t. But I think we can do pretty well in assessing how the other side is likely to approach the risks involved with such unpredictability. People settle cases, after all, to avoid risk. I suspect that, more often than not, a case’s "value" to either litigant depends less on what the parties guess a jury is likely to do, and more on how far each believes it can push the other because of what the jury might do.

* RSA 500-A:1, IV; RSA 500-A:7-a, I.

† Annmarie Timmons, "Juror Becomes a Defendant," Concord Monitor, March 26, 2009. For an analysis of the dangers we face from a newly empowered citizenry, but one which is becoming more and more ignorant of the structure of our legal system, see Retired Justice Souter’s remarks to the ABA on August 1, 2009. The video is worth watching.

The Heart is a Piece of Plumbing

noreply@blogger.com (John Lassey) — Thu, 08 Oct 2009 09:26:00 +0000

Grant you, it’s a very sophisticated and marvelous piece of plumbing, but, at bottom, its function is to pump liquid, not to serve as a substitute for the brain or for due diligence! Making decisions on important issues "because my heart tells me to" — i.e., based on the emotion of the moment instead of on thoughtful analysis — is a recipe for disappointment at best, and disaster at worst.

Most attorneys and mediators involved in personal injury work recognize that emotion is a fact of life. It is something we’ll have to deal with as long as our business involves helping to pick up the pieces littering peoples’ lives after serious accidents or other traumatic events.

Conventional wisdom has it that venting can help to dispel emotion that may cloud an injured plaintiff’s judgment concerning settlement. There is a lot of truth in this. However, there is a danger that venting may be too cathartic, and cause the parties to relax too much, after having gotten it all off of their chests. Unvented anger may cause people to over value a case, thereby lessening the chances for a fair settlement. But too much relief at having vented may also have the opposite effect. Just because the parties may have started to feel warm and fuzzy doesn’t mean that the case ought to be settled for more or less than it is worth.

It is the lawyer’s job to see that the client gets a fair deal. As I said in an article I wrote a couple of years ago:

In the midst of all the emotion and feeling good about oneself promoted by much of the mediation literature, lawyers must protect their clients. A lawyer cannot allow the client’s emotions of the moment to override his or her good sense. The lawyer absolutely cannot recommend an unfair settlement just because the client is temporarily relieved by venting, or induced into a feeling of euphoria by having had a good cry with the other side. The lawyer must protect the client from the perception of value, if reality lies elsewhere.*

The job of the lawyer is not to accommodate the client’s emotion and use it as an excuse to recommend a settlement that the client may temporarily go along with at the mediation, but regret later on. Instead, the lawyer’s job is to objectively advise the client based on the latter’s long-term interests. A lawyer who believes that the client is being overly influenced by his or her "heart," should try to talk the client out of moving too precipitously and, if that approach fails, should suggest strongly that negotiations be suspended and resumed at a later time after some further reflection and analysis.

The object of mediation is not settlement at all cost, but settlement that fairly addresses the long range interests of the parties.

* See "Of Potted Plants and Personal Injury: a Contrarian View of Mediation," published in the Fall 2007 issue of New Hampshire Trial Bar News (Vol. 29, p. 169), published by the New Hampshire Trial Lawyers Association (now The New Hampshire Association for Justice).

Uncomfortable Truths

noreply@blogger.com (John Lassey) — Thu, 01 Oct 2009 09:24:00 +0000

Applied to the right cases, there is no doubt that the mediation process can do a lot at a relatively early stage to resolve what would otherwise be protracted and expensive litigation. Having said that, I also believe that there are many cases where a mediator would be superfluous. This proposition may sound like heresy, coming as it does from someone who makes a good part of his living mediating cases, but I think it is borne out by my experience since 1992 as a volunteer neutral for the New Hampshire Court system’s mandatory ADR program.

In my state, civil cases that used to settle "on the court house steps" are now scheduled for mediation or other ADR at a point in the discovery process when the parties expect to have a reasonably good handle on the facts, but have not yet spent the time and money necessary to get their cases completely ready for trial. The program’s statistics show that cases are settling earlier than they used to, but do not appear to indicate a substantial increase in the settlement rate overall.

I have long had a sneaking suspicion that the pre-1992 delays in settlement — at least for the mostly-about-money cases — were primarily due to inertia, rather than to the lack of intervention by mediators, and that improvements since have had more to do with timing and party readiness than with the process of mediation itself. My experience with mediating fairly routine soft-tissue injury cases, for example, suggests that when parties are ready to settle, and come into mediation with a fairly good idea of the reasonable range of values, their cases usually settle. But they settle because the parties and their attorneys are ready and on roughly the same page, rather than because they got a lot of help from the mediator. In many other cases I have mediated, the parties were not ready and needed further discovery before they could begin serious negotiations. Most of those cases went on to settle without outside assistance after further information was obtained and exchanged.

When ADR is scheduled by the courts, lawyers, parties and insurers are (a) required to look at their files at the same time, (b) get together at the same time, and (c) work on resolving their case at the same time. Guess what, folks; with a little extra effort and planning, you don’t always need a mediator when you have that going for you.

In fairly routine cases, instead of reflexively scheduling a mediation, if you have a reasonable level of comfort with your opposing lawyer, sit down for lunch with him or her and see whether direct negotiations might be a better way to go. Kick the case around frankly "off the record," discussing in general terms how you will play your strengths and how you will deal with your weaknesses. Forget all that stuff you may have read about appearing to be weak when you talk about settlement. Hardly anybody thinks like that anymore.

You don’t have to start talking about a specific range of values at this juncture.* There are other ways to get a feel for how your opposite number sees the ballpark. Statements like, "My client isn’t looking to retire on this," or, "my company knows it’s going to be on the hook for something," for example, may be enough. If you think that further negotiations are likely to be fruitful, schedule a face to face settlement conference attended by everybody who would normally attend a mediation — except the mediator. Have separate rooms for private attorney-client discussions, and then just negotiate as you probably would with a mediator — the plaintiff starting high; the defendant starting low; and both meeting somewhere in between.

If this approach doesn’t work, at least you have a pretty good idea what the problem is, and can then hire a mediator — or not.

* In fact, that would probably be a bad idea. If you come right out and suggest a range of values, say, between $25,000 and $40,000, your opponent will regard that as a $25,000 demand if you represent the plaintiff, or a $40,000 offer if you represent the defendant!

The Great Compromise*

noreply@blogger.com (John Lassey) — Thu, 24 Sep 2009 08:54:00 +0000

What is it about the word "compromise" that tends to raise the hackles of those who hear or read it? To many, any compromise is regarded as the shameful abandonment of principle. Perhaps the best example of the negative visions that the word conjures is the Munich debacle in the fall of 1938. Neville Chamberlain, trying desperately to avoid another catastrophic war with Germany, sold the fledgling Republic of Czechoslovakia down the river, thus, making another catastrophic war with Germany inevitable.

Against such a backdrop, it is well to remember that the word "compromise" was not always considered epithetical. In any society, interests — even principled interests — will inevitably clash. For a society to survive, means must be found to resolve those differences peacefully. And not all conflicts are susceptible to win-win resolutions. The great British statesman, Edmund Burke, for one, regarded compromise as an essential and beneficial part of the human condition. See my post of May 26, 2008, "The Best Compromise That Never Was?."

In order to counter the prejudice against all compromise, it is useful from time to time to discuss historical examples of some that proved to be fortunate. The first that springs to my mind was reached in July of 1787 at Independence Hall in Philadelphia (pictured above). As I have stated before, the drafting of the United States Constitution involved "a high-stakes negotiation among many distinct interest groups." See "Yes, Virginia, There Is a Plan," May 25, 2008. Potentially the most crippling dispute facing the delegates dealt with the question of how the national legislature would be constituted. Delegates from larger states like Virginia favored election of representatives based on population. This, its adherents believed, would assure a legislative body truly national in character. Opponents of this concept, chiefly from the less populous states, believed that each state should have equal representation, else the smaller states would lose all power in the national government.

More than mere self-interest was involved in the debate; both sides supported their positions with principled arguments. The question occupied the delegates for a month, with almost no progress toward resolution being made. The issue was so divisive that many despaired of overcoming it and feared that the Convention would dissolve in failure as a result. Fortunately, most delegates were committed to the success of the endeavor, and ultimately took the larger view that without some compromise of principle, the entire American experiment would miscarry. Thus, they recognized that the larger principle of national unity was on the line, without which all other principles would be irrelevant. A so-called "Grand Committee," with members from each state, was formed to study the issue over the Fourth of July recess. One of its members was Benjamin Franklin, who proposed the concept of proportional representation in the lower house (House of Representatives) — which was to be given the exclusive power to generate revenue bills — but equal representation for each state in the upper house (Senate).†

It took almost two more weeks, but ultimately the delegates approved the compromise by a narrow margin. Eventually even James Madison, one of the most strident of those opposed to anything but 100% proportional representation, put the issue behind him.

And the rest, as they say, is history.

* For background on this post, I am indebted to William L. Shirer’s classic The Rise and Fall of the Third Reich (New York: Simon and Schuster, 1960), Catherine Drinker Bowen’s Miracle at Philadelphia: The Story of the Constitutional Convention, May to September 1787 (Boston: Little Brown and Co., 1966), and Richard Beeman’s more recent Plain, Honest Men: The Making of the American Constitution (New York: Random House, 2009).

† The concept of mixed representation — the people represented in the lower house and the states represented in the upper house — was based on a proposal floated the previous month by Roger Sherman of Connecticut, which is why the result is sometimes called the "Connecticut Compromise." But the idea didn’t get a lot of traction until Franklin wined and dined the members of the Grand Committee, tweaked it a bit, and lent it his support.

The Dick Francis Solution

noreply@blogger.com (John Lassey) — Thu, 17 Sep 2009 09:43:00 +0000

Long before I ever heard about Fisher and Ury’s Getting to Yes, I started reading Dick Francis’ mysteries. For those not familiar with his books, Francis, formerly a steeplechase jockey, develops his novels around British horse racing. His protagonists, rather than being super sleuths, are usually fairly normal, civilized people who are forced to deal with extraordinarily uncivilized situations; his villains are some of the most evil and malevolent specimens in literature. What struck me when I first started reading his books, was that their focus was primarily on how situations could be resolved to best serve the interests of the protagonists — even if the solutions did not always result in all the villains getting satisfactorily crunched.*

With this background, when I was first exposed to Getting to Yes, it was relatively easy for me to understand what the authors were getting at when they discussed the superiority of focusing on interests rather than positions.

When a person is injured due to another’s fault, often the first reaction is a desire to punish the offender. If I have been hurt because someone else was careless, I want the other guy to suffer as much as, or more than, I have. It is difficult for the lizard part of my brain to accept that the aim of the civil justice system is not punishment. Sometimes this initial reaction will fade with the passage of time, but not always and usually not completely. A plaintiff’s lawyer who expects a case to settle must work with his or her client to overcome this natural reaction.

"Revenge," the proverb says, "is a dish best served cold." But, in truth, it isn’t a dish at all. Revenge doesn’t put food on the table, replace lost income, or pay medical bills. Revenge doesn’t put your kids through college or provide for your retirement. And, largely because of liability insurance, the defendant will never feel the financial pain he or she has inflicted on you.

The sooner a plaintiff accepts the reality of the situation and is ready to make decisions based on what is best for him or her, as opposed to what is bad for the other guy — to accept the Dick Francis solution, in other words — the sooner a case is likely to settle and the plaintiff can move on with his or her life.

* Some examples are Risk (1978), Reflex (1981), Straight (1989) and To the Hilt (1996).

Deus ex Machina Mediation

noreply@blogger.com (John Lassey) — Thu, 10 Sep 2009 07:57:00 +0000

Deus ex machina literally means "God from a machine," and refers to the practice in ancient Greek drama* of bringing in a god (lowered to the stage toward the end of the last act by a crane or on a piece of scaffolding) to magically solve all the problems created during the course of the play. Merriam-Webster Online defines the term in context as "a person or thing (as in fiction or drama) that appears or is introduced suddenly and unexpectedly and provides a contrived solution to an apparently insoluble difficulty."†

Some litigants approach mediation with little or no preparation, no clear vision of the result they want to achieve, and no plan as to how to proceed. The idea on each side seems to be that it is the mediator’s job to somehow convince the others to accept their position, without having to present a clear reason for them to do so beyond saying something like: "We are confident that a jury in this county will go along with us." The mediator is then expected, by means indiscernible to mere mortals, to get everyone to agree to a solution somewhere in between the parties’ positions. In reality, the mediator is reduced to shuttling back and forth like Henry Kissinger, unable to say anything more illuminating than "[d]o you realize you might lose this case?" Although such mediations do sometimes lead to settlement, I suspect that the same results could have been achieved by exchanging a series of e-mails, without the need for a mediator.

For a mediator to help parties settle a case, the parties and their lawyers normally have to work as hard as, or harder than, the mediator. They must: (a) know their cases thoroughly; (b) be imaginative and flexible; (c) know roughly where they want to go; (d) have a plan as to how to get there; and (e) be prepared to give plausible reasons for each step taken. If the participants have done their homework, then mediators have many tools to smooth the process and help the parties arrive at a mutually satisfying solution.

As is the case with most human endeavors, hard work, sweat and preparation are necessary to get the job done. Sorry, but as Vernon Dursley put it: "There’s no such thing as magic!"‡

* I have no idea why it’s a Latin phrase, rather than Greek.

† Merriam Webster’s Online Dictionary (10th ed).

‡ Harry Potter and the Sorcerer’s Stone, Chris Columbus, Director (Warner Bros. 2001).

Little Blank Spaces

noreply@blogger.com (John Lassey) — Thu, 03 Sep 2009 14:19:00 +0000

When a liability insurance claims office gets a report that one of its insureds has been in an accident, it immediately sets up a file, gives it a claim number, and assigns it to a claims representative. Typically, the company’s guidelines require that certain information about the claim be obtained before it will consider making a substantial offer. The required information includes basic documents about the accident (police report, witness statements, e.g.), plaintiff’s lost time and earnings from work, medical bills, medical records, whether the plaintiff has reached a medical end point, etc. I tell plaintiffs that the claims rep has lots of little blank spaces on his or her computer screen and, until those spaces are filled in, the money faucet will remain closed.

It follows that if you represent an injured plaintiff, you will want to find out what those blank spaces are and help the claims rep fill them in as soon as possible. If you don’t know what they are, ask. By thus accommodating the company’s protocol, you won’t turn a doggy case into a winner, but you should enhance your credibility with the insurance company in meritorious cases and help set the stage for a successful mediation.

For more on the same subject, see my article entitled, "Dealing with Insurance Company Claims Representatives," written in 2006.

Mediation as Anti-Social Behavior, II

noreply@blogger.com (John Lassey) — Thu, 27 Aug 2009 10:37:00 +0000

I first posted on this subject last year (See "Mediation as Anti-Social Behavior," May 16, 2008) following a post by Geoff Sharp, in which he discussed Prof. Owen Fiss’s 1984 article, Against Settlement, 93 Yale L.J. 1073. Others have continued the discussion, which centers on whether justice is ill-served by people who settle their legal disputes without considering whether society as a whole would be better off if they fought things out in the courts. See, e.g., Michael L. Moffitt’s article, "Three Things to Be Against (‘Settlement’ Not Included) - A Response to Owen Fiss,"

In my earlier post, I deliberately put off discussing "whether individual litigants should be asked to spend their own money to carry society’s banners into battle (presumably for the honor of the thing)." This aspect of the issue appears to have been given little attention by those participating in the debate, but I believe it to be the nub of the matter. The idea that people who have a chance to quickly and efficiently resolve their grievances by settlement should nonetheless be encouraged to forgo that option for a protracted and expensive court battle seems foreign to any concept of justice with which I am familiar. To me, it is basic that the litigants’ interests are paramount, and if society wants a different benefit, society should bear the burden of getting it.

To help clarify the issue as I see it, let’s return to the Supreme Court’s decision in Brown v. Board of Education, a case that is often cited to suggest that settlement would not always be the ideal. To some, the proper question apparently is: "Would the country have been better off if the Browns and Topeka’s Board of Education had settled?" Perhaps not. But to me, as a practicing attorney and mediator, the proper question is: "Would the Browns and the Board and all the other litigants in the cases consolidated in Brown by the Supreme Court — the clients, i.e. — have been better off?" Would Linda Brown have been better off if, instead of litigating, her family had been able to resolve matters early on with the Topeka Board of Education?

This is not to suggest that litigants should be discouraged from fighting for a principle if they want to, and are able to garner the necessary support for their battle. I have never felt that litigants should be forced or coerced into settlement negotiations of any kind. See, e.g., my post of May 17, 2008, "Should Mediation be Mandatory?" There is certainly nothing wrong with individuals or groups choosing to fight passionately for a worthy cause. We need to remember, though, that while the creation of omelets may benefit society, the eggs are seldom better off afterward.

It is beyond the scope of this blog to do complete justice to this topic, but I think it would be beneficial if we started focusing at least some of the debate on it.

That’s My Money We’re Talking About!

noreply@blogger.com (John Lassey) — Sat, 22 Aug 2009 18:07:00 +0000

This post is mostly for defense attorneys in tort litigation. Hopefully, however, plaintiffs’ attorneys will also gain some insight from it. It has to do with a twist on the so-called "endowment effect" described by Barry Goldman in The Science of Settlement: Ideas for Negotiators, ALI-ABA (2008), § 2.01(e). In a nutshell, the endowment effect is a quirk of human nature that causes people to dislike losing something they already have more than they like gaining something they don’t have. I.e., all else being equal, folks would rather not lose than win. It has been posited that the effect causes plaintiffs to make larger concessions in negotiation than defendants. See James A. Wall, Jr., & Suzanne Chan-Serafin, "Processes in Civil Case Mediations," 26 Conflict Resolution Quarterly 261, 266 (2009). The idea is that it is easier for plaintiffs to "give up" something they never had than for defendants to pay out something they do have.

Conversely, if plaintiffs have an "ownership interest" in an off-the-wall settlement amount fueled by unreasonable notions of value, they are more reluctant to accept less than otherwise. Smart plaintiff attorneys are aware of this effect and resist the temptation to over sell a case’s value to their clients.

Defense attorneys can take advantage of the endowment effect by making a reasonable offer in advance of mediation. By "reasonable," I mean something at the lower end of the range of values,* but still within the ballpark. See my discussion of so-called "reverse demand letters" in "Preparing (Your Opponent) for Mediation" (May 12, 2008). This offer should be made far enough in advance of mediation that plaintiff’s counsel has the opportunity to communicate some optimism to the client (e.g., "I’m encouraged by this offer; they’re not there yet, but I think mediation is likely to be productive"). Bolstered by the attorney’s qualified optimism, the plaintiff is more likely to start taking ownership of the offer. Given some time, the plaintiff will be inclined to start thinking about what he or she can do with that money. It stops being the insurance company’s money and starts becoming the plaintiff’s new pickup, remodeled kitchen, down payment on a vacation home, or — in some cases — the ability to take early retirement.

Given most people’s preference for not losing over winning, such a mind set is likely to lead to a greater reluctance to walk away from a settlement, even if the amount offered is "not quite there."

* See my post entitled "Ask Not for Whom the Bell Curve Tolls . . .."