In Negotiation as in LIfe, Timing is Everything

In the last couple of weeks, I've heard two mediations which were brought to me before a lawsuit had been filed, and two that were within a month of trial.  Which is the better time to settle the lawsuit? 
      In one case, a tenant was seeking reimbursement for pre-paid rents and security deposits after being evicted when the house was sold in foreclosure during the pendency of their lease.  The trouble was that the lawyer for the sold out owner/landlord had done a lot of legal research that she had not shared with the tenants, indicating that they had a right to stay in the leasehold based upon California law protecting tenants in just this type of situation following the housing bust beginning in 2008.  Though they were required to attempt mediation under the lease, the lack of information made this mediation too early to be effective.  Still, the lawyers and their clients knew a lot more about one another's claims and perspective when they left than when they arrived.  Not a wasted effort:  just a step towards meaningful negotiation.
     In another case, for wrongful termination in retaliation for whistleblowing, the parties are on the verge of spending a week in a binding arbitration before a retired Judge.  To date, both parties have held off on incurring the expense of substantial formal discovery, given the typical limits imposed in an arbitration (usually one deposition per side and one set of Interrogatories and Requests for Documents).  As a consequence, there were lots of witnesses and theories exposed in this mediation that had not been considered before by the lawyers involved in the case.  Both of them were caused to have difficult conversations with their respective clients, and re-evaluate their positions dramatically as the result of this safe and confidential conversation through an unbiased intermediary.
     In both instances, though at opposite ends of the life of the lawsuit, mediation was useful and informative in getting to the ultimate resolution of the lawsuit.   Maybe it is time to expand the objectives of a mediation beyond simply "settling a case".  Here, both sides found a great deal of value in coming together in a non-confrontational way through an unbiased intermediary to explore the issues, the evidence and the contours of the value of the cases (in their own minds and their opposing parties').  Each side will now have to consider the value of further litigation to find out whether it is worth the risk and expense to move forward or whether there is some region where the case can be settled satisfactorily without testing these boundaries.  I have my predictions....