The Smartest Thing to Do in Mediation
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Litigation Status Reports from the Confederate States of America
THINGS ARE GOING GREAT – LET’S KEEP FIGHTING
The fall of Atlanta “is not a calamity that endangers our cause.”
Montgomery, Alabama Advertiser, September 1864
Montgomery, Alabama Advertiser, September 1864
“No former period of the war has contained such elements of encouragement for the South as the present.”
Richmond, Virginia Examiner, February 1865, 60 days before the surrender at Appomattox
Richmond, Virginia Examiner, February 1865, 60 days before the surrender at Appomattox
Many clients receive litigation status reports that parallel the unfounded optimism in the South in the final months of the U.S. Civil War. People who try to settle cases often see litigants with that same willful refusal to recognize a failing battle effort. Parties and lawyers who have been living with a case for a long time may delude themselves about their chances of winning.
Lawyers in the Front Line
Typically, the lawyer is the front-line soldier with the best ability to assess how things are going. The client expects reliable status reports and guidance in choosing the best course for the litigation. Corporate and insurance clients usually require reports to include an evaluation.Clients want a lawyer who believes in their case. And lawyers have a duty both to the client and the legal system to represent the client “zealously within the bounds of the law.” But sometimes lawyers prepare status reports which mislead clients to pursue expensive and futile choices.Some lawyers seem to think they are litigation superheroes who can’t be beat. Dig deeper and you will find they settle most of their cases, but at what cost? The justification that the client would have gotten a worse deal without the lawyer’s extreme tactics may not be sound.Many lawyers are like animals burrowing a tunnel who never stick out their head to see where they are. They have a playbook they think they need to follow before even considering settlement. It seems like there is always one more report, one more deposition, one more motion they have to have.Lawyers also fear telling clients the unvarnished truth about their cases because the lawyers want to keep the gig. I’ve seen cases where it is the third lawyer on the case on each side. In one instance, the lawyer told me that both prior lawyers had counseled that the opponent’s settlement proposal was reasonable; each was fired. The current lawyer said, “You and I both know those lawyers were right, and they were fired. I am going to try the case.”
Typically, the lawyer is the front-line soldier with the best ability to assess how things are going. The client expects reliable status reports and guidance in choosing the best course for the litigation. Corporate and insurance clients usually require reports to include an evaluation.Clients want a lawyer who believes in their case. And lawyers have a duty both to the client and the legal system to represent the client “zealously within the bounds of the law.” But sometimes lawyers prepare status reports which mislead clients to pursue expensive and futile choices.Some lawyers seem to think they are litigation superheroes who can’t be beat. Dig deeper and you will find they settle most of their cases, but at what cost? The justification that the client would have gotten a worse deal without the lawyer’s extreme tactics may not be sound.Many lawyers are like animals burrowing a tunnel who never stick out their head to see where they are. They have a playbook they think they need to follow before even considering settlement. It seems like there is always one more report, one more deposition, one more motion they have to have.Lawyers also fear telling clients the unvarnished truth about their cases because the lawyers want to keep the gig. I’ve seen cases where it is the third lawyer on the case on each side. In one instance, the lawyer told me that both prior lawyers had counseled that the opponent’s settlement proposal was reasonable; each was fired. The current lawyer said, “You and I both know those lawyers were right, and they were fired. I am going to try the case.”
Those battles at Lookout Mountain and Missionary Ridge? According to the Mobile Register, union casualties were “ten times greater than ours.” In fact Confederacy casualties numbered 6,687 to the Union’s 5,815.
Psychological Reasons for Unfounded Optimism
There are psychological reasons why people refuse to settle. For example, people need to justify past expenditures, known as “sunk costs.” So they feel the need to keep fighting, even when settlement is the best way to stop that drain. Another is reactive devaluation, where people refuse to credit information from the opponent which conflicts with the belief system they have created for themselves.When litigation status reports only offer a choice among battle plans, clients may not realize settlement could be their best option.
There are psychological reasons why people refuse to settle. For example, people need to justify past expenditures, known as “sunk costs.” So they feel the need to keep fighting, even when settlement is the best way to stop that drain. Another is reactive devaluation, where people refuse to credit information from the opponent which conflicts with the belief system they have created for themselves.When litigation status reports only offer a choice among battle plans, clients may not realize settlement could be their best option.
Pass the Buck to the Mediator
Mediation is a good way to get the most belligerent parties to talk about settlement. Opposing sides don’t even have to sit together. Caucus sessions take place among the mediator and representatives of a single side. Nothing said in caucus gets repeated elsewhere without the party’s permission, so caucus is a safe place to discuss the weaknesses of a case as well as its merits.The mediator is a professional neutral. Parties can get the opinion of someone who comes to the case without preconception. This is closest to what could happen in court. The mediator can ask pertinent questions and bring the parties to partial or full agreement.When parties can’t bring themselves to agree, the mediator can suggest a mediator’s proposal to close the case. This allows everyone to save face and does not damage the attorney-client relationship.If you are creating or receiving litigation status reports that don’t consider mediation, an essential part of the plan may be missing. Mediation offers a timely, cost-effective way to end whatever war you’re fighting.
Humility Leads to Mediation Success
Here’s an oxymoron for you: the humble litigator. Like jumbo shrimp and military intelligence, it may seem ridiculous to pair humility with any litigator. But for anyone trying to settle a claim, a little humility can help get you to the finish line.
Most of the time that dispute will eventually settle without court intervention. The parties want to resolve the issue with the smallest expenditure of time and money. Incivility, bias, prejudice and anger are inconsistent with humility and get in the way of settlement.
Acting with humility does not admit fault. The most successful litigators are courteous and respectful.
I’m The One Who’s Right
Of course you are.
Then why is the other side fighting so hard to say the opposite? Of course they’re completely wrong, but maybe, just maybe, you could pretend they have a reasonable point of view. Or—here’s a shocking concept—try to see their point of view.
Students learning to debate (or get through law school) may be asked to argue a position with which they disagree. While preparing for mediation, try to outline the other side’s position and think about all the reasons supporting that position. This is an excellent way to marshal your own arguments. It is also an exercise in empathy.
You Want Me To Do What??
Think about forgiveness. When you feel wronged, your desire for vindication may make negotiation difficult. Forgiveness must be internal and not necessarily verbalized.
Forgiveness is about moving on, doing the best thing for you and those you represent, not for the benefit of the offender. Forgiveness keeps you in control of your emotions rather than surrendering control to the volatility of others. Forgiveness does not validate the other side’s behavior or minimize the damage it has caused. It doesn’t mean you were not wronged or that the parties will have a good future relationship.
Conversely, a well-phrased apology has helped settle many a case. For example, I watched one litigator, without any prompting and without admitting fault, express sorrow that the injured worker had experienced a lengthy delay in getting treatment. That may not be right for your case; for his, it was. Don’t forget that everything said in mediation is confidential and cannot be used for evidence in any forum.
Good People, Strong Emotions
You’re a good person, right? Yet, difficult situations can spark rage and other extreme emotions in the best of people who then behave without humility.
In mediation you can state your position in the strongest terms in a private session with the mediator. The mediator can then skillfully communicate those emotions to move parties to settlement.
A bit of humility can improve your effectiveness in formulating and reacting to those communications.
How to Win With Throwaway Issues
Some issues aren’t worth fighting over. Yet, parties and counsel frequently do take a stand when they might do better by taking a step back and just throwing that issue away.
It’s the Principle of the Thing
OK, you’re completely right on this issue—but what is the big picture? A fight over a $300 interpreter bill is counterproductive when you are trying to resolve a claim with a value of $600,000.
When mediation participants staunchly maintain, “It’s the principle,” they almost always mean, “It’s the money.” Particularly for the employer side, this is a business negotiation. Savvy negotiators know how to bargain away the little issues to get the optimum result.
Location, Location, Location
Perhaps the most common throwaway is where to convene the mediation. Southern California is a big place, and drives of several hours to get to a Board or mediation are not uncommon. Sometimes parties argue over where to hold the mediation. You can’t resolve the case if you can’t even agree where to get together to talk about it.
Usually, California workers compensation mediations are held in one of the attorney’s offices. Sometimes only the defense attorney’s office is large enough to accommodate the participants. But negotiations may be most fruitful at a location which does not intimidate the injured worker. Using the AA’s personal office and the reception area for caucuses (mediator sessions with only one side) may seem cramped, but if the injured worker is most comfortable there, that may be the best choice. If you are arguing over this issue, just give it up.
I Owe You One, Man
Negotiation is a give-and take process. Once someone has acquiesced on an issue, the other party usually feels somewhat beholden to give way on the next one. Minimally, your “generosity” with issues which are of little consequence to you can show how reasonable you are. These concessions help advance the mediation toward a successful conclusion.
Some negotiators invent issues to fight over just so they can have them in their back pocket to throw away. Throwing away your position on an issue can be the smartest way to negotiate to the best final resolution.
Settlement Ethics
Ethics are the moral principles that govern behavior. Every workers compensation professional has ethical rules to follow. For attorneys, these are spelled out in Codes of Professional Responsibility, statutes and sometimes case law. Despite some differences among the states, the basic principles governing settlement ethics are mostly the same
Duty to Communicate to the Client
Lawyers must keep clients reasonably informed about significant developments (CA Rule of Professional Conduct 3-500). CA Rule 3-510 tells lawyers to promptly communicate the specifics of a written settlement offer. In other words, a California lawyer need only pass along a verbal settlement offer if the lawyer deems the offer significant. The lesson for negotiators is to make all settlement offers in writing to ensure the client learns about them. The bonus: a written offer avoids confusion about the offer’s terms.
In an unpublished Texas case, Grillo v. Harris Hospital, a former client sued for legal malpractice damages for the alleged failure to communicate a settlement offer. The suit claimed that the attorney’s failure to convey a structured settlement offer resulted in the plaintiff’s loss of public benefits worth millions of dollars. The law firm paid a $1.6M settlement.
Duty of Competence
A lawyer must be competent, defined as having the diligence, learning and skill, and mental, emotional and physical ability to practice (CA Rule of Professional Conduct 3-110). That means the lawyer should be conversant with all the factors impacting settlement, including access to public benefits and tax. If the lawyer is not expert in a subject, the lawyer can notify the client to obtain such an expert.
Duty of Honesty
Lawyers must act honestly in litigation, including settlement negotiations. California Business and Professions Code Section 6068(d) requires an attorney to “employ, for the purpose of maintaining the causes confided to him or her those means only as are consistent with truth…“ Business & Professions Code 6128 imposes misdemeanor criminal liability on a lawyer who intends “to deceive the court or any party.” The maximum penalty is a six-month jail sentence, a fine up to $2,500 or both.