Reprinted from the Newsletter of the Litigation Section of the State Bar of California. Vol.4 No.2. Spring 1994
REAL LITIGATORS DON'T EAT QUICHE
& Other Myths About Mediation
by Steven Rosenberg
Because of their acceptance of certain myths, some attorneys are unwilling to offer their clients the benefits of mediation. Let's examine some of these myths.
A tough, effective, take-no-prisoners litigator should not mediate, because real litigators don't mediate.
The problem with this myth is that it assumes the only effective way to resole a dispute is in trial, or worse after protracted litigation. Clients are typically concerned with the bottom line result and not with how it is obtained. The best litigator is one who obtains results satisfactory to her client, and is flexible in the methods by which those results are obtained.
A strong and effective advocate uses a variety of techniques and skills to advance his clients' interests. Mediation is one of those techniques. There are many situations in which mediation is the most effective method to advance the client's interests. Thus, an attorney must be alert to opportunities to utilize mediation. For instance, mediation may allow a party to obtain meaningful relief early enough to be a benefit or when the legal or monetary remedies are inadequate.
Suggesting mediation will be interpreted as a sign that your case is too weak to try.
An attorney's willingness to mediate often demonstrates confidence in her case because it will be exposed to the scrutiny of a neutral party and candid discussions about its strengths and weaknesses. Opposing counsel recognize mediation as an appropriate and valuable tool to resolve litigation. Moreover, once mediation commences, the "weak case" myth dissipates as evidence clarifies the issues and the actual merits of each party's become clear.
Furthermore, to the extent that this imagined appearance of weakness is a concern, court rules such as Marin County Superior Court Rule 5 and U.S. District Court General Order #37 eliminate any such perception by making mediation the court's idea.
The United States District Court for the Northern District of California has adopted a mediation program for all civil actions filed after July 1, 1993, in five designated departments. Many other courts either mandate or strongly encourage mediation.
On another front, many businesses and insurance carriers are very supportive of mediation, and eager to utilize it. The Center for Public Resources (CPR) in New York has issued a corporate policy statement on ADR which commits the signators to use ADR before resorting to traditional litigation. Over 600 of the nation's largest companies, and 1,800 subsidiaries, have signed the statement.
You should also be aware that most major businesses (fn-1) and insurance carriers (fn-2) are very supportive of mediation, and eager to utilize it.
David Mulford, Senior Counsel for Bechtel, characterizes the weakness myth as "antediluvian" thinking. He states that if plaintiff's counsel suggests mediation, he views it as a sign of enlightened thinking. He is not at all concerned about the negative inference from suggesting mediation himself. (fn-3)
Finally, if you are concerned about an implication of weakness as a result of suggesting mediation, you can try one or more of the following approaches. First, when you have your first contact with opposing counsel, you can explain that it is your firm's policy to refer most cases to mediation. Second, you can allow the mediator to try to get the other party to the table ("process negotiation"). Most mediation providers offer this service and will usually succeed in obtaining an agreement to mediate. Finally, when appropriate, you could indicate that the opposing party is a signator on the CPR policy statement, as discussed above.
In Mediation, I will be coerced or badgered into settlement or face a "split the difference" approach.
You are in control in mediation, a coerced settlement can not happen because the entire process is voluntary. The decisions to enter mediation, to remain in mediation, and to settle are in your control. You may terminate mediation at any time you choose. The mediator has no power to compel a settlement. Furthermore, because the resolution emanates from the parties, not the mediator, a capricious "split the difference" approach cannot occur. The number (or solution) agreed upon is the result of a principled, considered, and informed process, not coercion.
Release of information in mediation will jeopardize my case.
Pursuant to Code of Civil Procedure Section 1152.5 the statements made in mediation cannot be used in Court. Further, the parties can stipulate that the proceedings will be kept confidential. Each attorney and her client are in complete control of what information is released or divulged and the timing of such disclosures. The attorney can make the same tactical decision concerning the release of information she would make in a settlement conference or in any other settlement negotiations. However, in mediation the attorney has the added advantage through the use of private meetings with the mediator of being able to strategically control the timing and release of information and settlement authority.
Some attorneys also believe that their cases may be jeopardized from an evidentiary standpoint in the event they do not successfully resolve those cases in mediation. This should not be a concern. Pursuant to California Evidence Code Section 1152.5: "...when persons agree to conduct and participate in a mediation...Evidence of anything said or of any admission made in the course of the mediation is not admissible in evidence or subject to discovery, and disclosure of this evidence shall not be compelled, in any civil action...[N]o document prepared for the purpose of, or in the course of, or pursuant to, the mediation,...is admissible in evidence or subject to discovery, and disclosure of such a document shall not be compelled, in any civil action..."
Similarly, General Order 37 of the United States District Court for the Northern District of California, X Confidentiality, prevents the statements made in mediation from being used in evidence. Other courts may have similar provisions.
I've got a "sure winner," therefore, mediation is unnecessary.
Even a "sure winner", (fn-4) if there is such a thing, is more expensive and time consuming to litigate than to settle. If it is in fact a strong case, you should be able to obtain a favorable settlement quickly. Conversely, if your case is weak, you have the opportunity to explain the reality of the costs and time required for the opposing side to obtain relief.
Furthermore, your client will be "educated" by the mediation process and, perhaps, become more realistic about her case. By mediating and settling the case early in the proceedings, there will be more dollars available for settlement, creating the optimal situation for all parties.
Mediation will be a waste of time if: opposing counsel is difficult; incompetent; has an unrealistic attitude towards settlement; or has accepted his client's unsupported story.
(a) Because mediation directly involves the opposing party as well as the attorney, it often overcomes intransigence to assist settlement.
(b) Mediation addresses these concerns by providing a forum for "reality testing" and evaluation of other positions.
(c) The mediator can help an unrealistic party transition from telling his story to becoming more realistic about the merits of his case.
Mediation will be a waste of time and money if the case does not settle.
Most mediated cases settle. Even in those that do not, much can be accomplished. Often the parties will agree to narrow issues and/or parties, and otherwise streamline the case. Similarly, the parties may develop an agreed-upon discovery plan to further simplify the case. In addition, parties often report a heightened awareness of the strengths, weaknesses, and subtleties of their case. Finally, after mediation counsel for all sides indicate that they often obtain greater support from their client, as they prepare for trial. The clients have seen the attorney's efforts to settle and recognize the necessity of trying the matter.
The use of mediation will reduce my income.
Creating satisfied clients (fn-5) through the use of mediation is one of the best ways to retain and attract clients and thereby increase your income. Client satisfaction is enhanced by the use of mediation not only because the dispute is resolved more quickly and more economically, but because the client plays a more active role in the process. Knowledge of and judicious use of mediation and other alternative dispute resolution techniques may, in fact, increase your client following. Joseph H. Flom, partner of Skadden, Arps, Slate, Meagher & Flom noted in The Integration of ADR into Corporate Law Firm Practice, Dana H. Freyer, Arbitration Journal, December, 1990, that: "[a]s we enter the 1990's, ADR expertise is an essential component of the package of services that a corporate law firm should provide its clients." (fn-6) If your firm does not provide critical services such as mediation, clients will utilize other firms who do. Howard Golub, general counsel for PG&E has made it clear to the attorneys PG&E retains that their performance would be evaluated in part on the basis of how or whether they utilize mediation. See, The Wall Street Journal, Mediation Firms Alter the Legal Landscape, March 22, 1993, p. B1.
David Mulford, Senior counsel for Bechtel, reports that Bechtel's Outside Counsel Guidelines requires counsel to submit a case analysis indicating whether the case is amenable to mediation and other forms of ADR. However, he notes that the sophisticated counsel Bechtel employees are aware of the advantages of mediation. (fn-7) Similarly, Fireman Fund's procedures for Panel Counsel require that ADR, including mediation, be considered.
Walter Wriston, former CEO of Citibank offers excellent advice on this point: "As a businessman, if I don't listen to the market, I'm not in business. If I were an attorney, I'd make sure I was involved in alternative dispute resolution, because it may well be the service that the market will demand and I'll have to offer in the future." Similarly, Mark Mazzarella, the immediate past Chair of the State Bar Litigation Section, suggests that "Lawyers...may need to be prodded by clients who openly announce that they only retain lawyers who employ creative ADR solutions." See, California Litigation, Spring, 1993, Vol. 6 #3, p. 2.
Abraham Lincoln perhaps summed it up best a century and a half ag "As peacemaker, the lawyer has a superior opportunity to be a good man. There will still be business enough." (fn-8)
1. The Center for Public Resources (CPR) in New York has issued a corporate policy statement on ADR which commits the signators to use ADR before resorting to traditional litigation. Over 600 of the nation's largest companies (and 1,800 subsidiaries) have signed the statement.
2. Don Hawley, former national coordinator for ADR for Fireman's Fund Insurance Company, currently serving as Product Manager, Claims Dept., indicated that a request to mediate is almost always agreed to. He stated that weakness would not be the implication, rather it would be viewed as a realistic decision to put the cards on the table and resolve the case. He adds: "since 90% of these cases settle anyway, why not attempt mediation thus saving time and expenses for both sides while obtaining the desired result for all parties." Interview with Don Hawley, Fireman's Fund, Novato, CA, August 18, 1993.
3. Interview with David Mulford, Bechtel Corp., San Francisco, CA, August 4, 1993.
4. This term is normally not used by attorneys once the ink is dry on their bar certificate. Experienced practitioners realize there is no such thing. cf People v. [Rodney King]; L.A. Supr. Ct., 199 ; People v. Dan White, S.F. Supr. Ct. 197 ;
5. Client satisfaction is enhanced by the use of mediation not only because the dispute is resolved more quickly and more economically, but because the cliend plays a more active role in the process.
6. The Integration of ADR into Corporate Law Firm Practice, by Dana H. Freyer, Arbitration Journal, December, 1990.
7. Mulford Interview, Supra..
7. The Living Lincoln, "The Reflective Years"; July 1, 1850, edited by Paul M. Angle and Earl Schenck Miers, Rutgers University Press, 1955.