Wednesday, September 24, 2014

Getting to the ZOPA in Negotiation

Yesterday I heard an employment case where a trial lawyer earnestly believed that he could get an inflamed jury to award his client at least $500,000.00 based upon the wrongful termination of a young, minimum wage worker who had less than $20,000.00 in lost earnings and some challenging facts to overcome.  His former employer came to the mediation prepared to pay his lost earnings (actual damages) if he had to, but not at all prepared to pay something akin to "punitive" damages based upon the spin the trial lawyer intended to put on the case.  Clearly, the two parties were not in the same "playing field" and the old-fashioned distributive bargaining (an initial demand of $650,000 and an initial offer of $2,000) were never going to work to get this case settled.
When the parties or their lawyers arrive at mediation with wildly divergent evaluations of the case, it's worth spending as long as it takes to discuss and agree upon the ZOPA:  Zone of Possible Agreement, however broad it may be.  Just as in baseball, the parties need to work with their lawyers to determine the boundaries for negotiation and what is truly "out of bounds".  In this case, that occurred through my own hypothetical negotiations--each time narrowing the ball field until it became clear to me that the case had a settlement value of something between $10,000 and $100,000, not $2,000 and $650,000.  Once both sides agreed to be in the same "ball park" realistic negotiation could ensue.
How do you communicate to your clients or your adversary counsel about the ZOPA before wasting precious time defining the boundaries of negotiation in mediation?

Thursday, September 18, 2014

The Angel of Optimism: What to do (beyond Prayer) after a Mediation Fails

Mediations happen at all different times in the life of the dispute.  This month, I've mediated two matters that had not yet been filed as lawsuits, one where no discovery had yet been conducted, and another on the eve of trial after a previous mediation failed.  All of the disputants came with the hope and expectation that their conflict would get settled that day.  Unfortunately, it doesn't always work out that way.  But after the formal mediation ends, the hard work begins when phone call and email and private meetings and review of documents takes place in a painfully slower process than the single day in which everyone agrees to set aside their other business and concentrate on just one matter.  Parties and sometimes their lawyers are tempted to give up and proceed to spend the time, money and risk shutting down all negotiation in the name of thorough litigation--as though they were never going to revisit the wisdom of a settlement.  In those cases, I urge the litigants to tap gently on the shoulder of their "Angel of Optimism"/Mediator and allow me to keep them on track and cool as they navigate the tumultuous waters and get to the other side.  In other cases, I will admit that I end up serving as that pesky little dog who just won't let go of your pant leg.  Somehow or other, the parties are ever grateful that somebody sees it as their job to keep working for a resolution--even while they engage lawyers to prepare for the potential that this is the 1 case they will take to trial this year or next.  Which do you prefer:  the angel of optimism or a pesky little dog ever nagging you to tune back in to the conflict your weren't able to resolve last week?  What other ways do you "stay with the conflict" when it fails to settle at the mediation session?

Thursday, September 11, 2014

Non-Monetary Concessions in Mediation: Can they be Effective?

Believe it or not, lawsuits are not always brought merely for money.  Sometimes, a gesture of good faith, a sign of understanding, a non-monetary, symbolic concession can make all of the difference.  It sounds trite, yet many of my colleagues in the International Academy of Mediators have chimed in to a dialogue about the interesting array of non-monetary concessions they have witnessed in settling the highest level of legal disputes.
In my own practice, I had an interesting real estate dispute between neighbors over the rights to use of a parcel of land between them.  The Plaintiffs were seeking hundreds of thousands of dollars as damages, claiming that the value of their property had been substantially diminished.  As an interesting, creative offer, the lawyer for one of the parties offered to purchase the property from the Plaintiffs at a substantial increase from their purchase price.  Although they did not accept his offer, they did recognize that perhaps the property they thought had diminished in value, had in fact appreciated.   Rather than holding a clouded property, they now saw it as the gem they first endeavored to buy.  It was just that minor shift that opened the gates towards a reasonable settlement.
What are some of the creative ways that you've seen settlements occur that work effectively?

Thursday, September 4, 2014

Handling Continuing Continuances of Mediation

The lazy days of summer are behind us and most people return in September with a renewed purpose and determination to take care of business, stop procrastinating and get back to work.  In those cases where a scheduled mediation hearing  is continued more than once, the mediator is well-served to inquire and consider the basis for the continuance.  Is there a hint that the parties can work out their differences without the aid of a neutral third party?  Has one party lost hope that any meaningful settlement can be achieved? Is one party preparing to file bankruptcy, go out of business or abandon the claim? Is there posturing going on about how the fees should be split and who should be at the bargaining table if meaningful negotiations are to take place? Do the parties not wish to invest in the settlement by paying the mediator's fees in advance as is required by their engagement? Does one party not wish to pay their lawyer to pursue this avenue?  Has the Plaintiff or his lawyer lost interest in the case and reached the conclusion that it's not worth pursuing?
As in all facets of mediation, make no assumptions.  Still, I think it's fair to ask the party who requests the continuance why they are seeking it.  Sometimes, it can give valuable clues into the risks and benefits to settlement when they ultimately do show up for mediation.  How do you handle postponements and as lawyers, do you reveal the reasons to your mediator?