Helping Advocates
HELPING MEDIATION ADVOCATES BORROW THE MEDIATOR’S POWER
Scott Magers and Kay Elliott
Many mediators complain that attorneys don’t come to mediation as prepared as they would if they were in trial or arbitration. What is even more perplexing is that since so many cases settle in mediation, why not take advantage of this opportunity to get an optimal settlement for the client? Instead of just trying to “win” the mediation through distributive bargaining, why not go in with the idea of going beyond “winning” to a really creative and value-increasing outcome? Perhaps this idea is just not in the minds of attorneys who either compromise their financial outcomes in order to settle, or roll the dice at the court house, knowing one will lose. Instead of preparing their clients for negotiation, some attorneys tell their clients to say nothing and let them do the talking, then expect the mediator to do most of the heavy lifting in terms of getting a good settlement. Recently, at the TMCA symposium, Scott Magers mentioned that he had written an article on how advocates should prepare themselves and their clients for mediation. The following is a joint venture to adapt that previously presented paper to the mediator’s tool box. Here are some of our ideas on how the mediator can help attorneys, who are not as sophisticated at mediation advocacy as they are at trial advocacy, get better outcomes, have a more productive process, and display their prowess to a client. As a mediator, you already know most of these techniques, but your clients do not, so you can use this article to help your clients, or send it to attorneys with whom you will be working, or just use the article to implement these ideas at your future mediations. We hope the ideas prove practical and useful to you and to the clients and attorneys you will be serving in the future.
Law students at Texas Wesleyan School of Law are taught how to represent a client in mediation. One tool for that type of representation is the Representation Plan in which the attorney outlines the strategy for settlement, the most persuasive facts and the law in the case as well as a negotiation plan. I have never yet had a practicing attorney hand me one or these. What I sometimes get is a settlement notebook. It is not difficult to turn a settlement notebook into a Representation Plan. I suggest that mediators help attorneys do exactly that - at least two days before the scheduled mediation. Then everyone enters the mediation process prepared. Just for a moment let’s take a look at what lawyers can gain from mediation to make that preparation justifiable. The most common reasons given to me as to why attorneys do not prepare anything to submit to me before mediation are that they didn’t have time and the client would not have wanted to pay for such preparation. I have never heard those reasons given for not preparing for trial - yet 96% of all cases will never reach the courtroom.
Let’s look first at some reasons to justify taking more time to prepare and also at how lawyers will be impacted by continuing to use mediation in litigation. Lawyers who work on a contingent fee will be most positively impacted. Since mediation and other ADR processes are faster than traditional lawyering processes, lawyers receive their compensation in less time, helping cash flow considerations. Further, ADR reduces the need for extensive, protracted and expensive discovery and research to prepare for a full scale trial. A representation plan can be based on some agreed facts, some facts stipulated just for the purpose of negotiation, and the results of the depositions or requests for disclosure completed prior to mediation and as part of limited discovery prior to the settlement conference. This means the investment in each case is lower and the net profit is higher. It also means not having to get more heavily invested in a case that is a loser. Even when a settlement is not reached in mediation, or another ADR process, the contingent-fee lawyer will learn more about the case, his client and the other side, which should translate into settlement later at lower costs. And last, but not least, the client will understand the actual problems his case presents to the attorney, so that the attorney does not have the impossible task of explaining why trying a case is not a good process option to a stubborn client with unrealistic expectations and a naive belief in a just world.
What about the billable hour attorney (often on the defense side)? The client who understands the difficulties his own case presents early in litigation is often happier with the outcome. If this is a repeat client, the lawyer can make the convincing argument that settling early will save the client money and that usually translates to repeat business from a grateful client. The client who believes that his lawyer risked a reduced fee by telling his client the truth has proved he has his client’s best interests at heart. With the public perception of lawyers at a historic low, ADR can be a public relations bonanza. It can also increase the collection of attorney fees, helping the lawyer to avoid accumulating a large unpaid bill from an unsatisfied client who lost at trial. Most trial lawyers understand the facts of life with regard to accounts receivable. Collection procedures are expensive and time consuming, and sometimes even lead to another dispute when the client claims the attorney committed malpractice.
There is another reality at play. Many cases are not ready for ADR until pre-trial work has sufficiently progressed. Participating in ADR is not always wise until the parties have a clear understanding of the case, its major ramifications and the bargaining zone. Thus the lawyer will often charge fees even in those cases that go to ADR. Some lawyers have even received a bonus payment because a case settled early and was very advantageous to the client. Not all fees have to be contingent or based on billable hours. They can also be based, quite ethically, on the benefit obtained by the client. If the eventual outcome at mediation is demonstrably superior to a simple compromise, it is quite probable the client will be willing to pay a bonus fee. Steve Brutsche, an early mediator pioneer, argued that lawyers should consider having this in their fee arrangements with happy clients who were well served by creative advocates.
Corporate counsels have a great deal to gain from ADR and are often the most skilled at representing clients in mediation. Because they are employees, they have a stake in the economic health of the company. ADR can reduce legal costs, increasing profits and also esprit de corps. By recommending the appropriate use of ADR, corporate counsels augment their good standing as well and protect their employer from adverse publicity which can damage the reputation of the company and its products or services. Mediation agreements, not just the settlement discussions, can be made confidential, unlike the verdict at trial which may hit the front page of the local newspaper.
PREPARING YOU AND YOUR CLIENT FOR MEDIATION
As we all know, mediation is defined as an intervention by a third party neutral that is designed to facilitate the process of negotiation. It is also a process in which an impartial third party assists disputants in finding a mutually acceptable solution to their dispute. Mediation should be both voluntary (even when it is court ordered) and confidential. This means that although the court can order parties to go to the table, they cannot order them to settle or bargain in good faith. The mediation process has stages: preparation phase, opening session, continuing joint or separate sessions and a settlement stage. The stages are designed to establish trust, explore issues and interests and seek creative solutions. The mediator’s role is to help the disputants, not to make judgments or decide who is right or wrong. The mediator may help the clients to prepare adequately for the process by encouraging and even suggesting ways the advocates can be most effective in negotiating a settlement. This would include recommending a confidential settlement notebook or representation plan be prepared by each advocate and sent to the mediator at least two days prior to the scheduled mediation.
Because discussions during mediation are “not for the record,” parties can be more open in discussing issues and considering options. The caucus is a strong positive aspect of reaching agreement, partially because that part of the process gives parties an extra layer of confidentiality. Another benefit is that at least one person in the settlement process, the mediator, will know more about the hidden agendas, interests and preferences of all parties than any single party will know.
Inherent in the definition of mediation is the concept that mediation is a means of disputant empowerment. It is a means by which the parties have self determination and are allowed and encouraged to take charge of their dispute and control the resolution of that dispute. This can only happen if clients are prepared by their advocates to participate actively in the settlement conversations. It has been shown that an agreement reached in mediation will more likely be acceptable to the parties if they have had a hand in shaping it and the agreement will more likely be implemented without problems when the parties feel they have a proprietary interest in it.
COUNSEL’S PREPARATION
When interviewing a client, the lawyer can determine the client’s concerns, hopes, expectations, attitudes, perceptions, beliefs, feelings and values. This is the basis upon which interest-based bargaining will be conducted in many mediations. Only when these are explicit can a productive option - generating session be conducted. If this was not done at the initial intake process, counsel can begin the mediation preparation by talking to the client specifically about these important settlement facts. Clients also need to understand the strengths and the weaknesses of their case, based on the litigation facts, their position, and the law. At the mediation, lawyers and their clients are given a rare opportunity to speak directly to the other side in a way that is designed to promote persuasion and the improvement of the often troubled relationship the parties have. A client who is coached and psychologically ready to say how they see the dispute and what they want to happen can be extremely helpful in getting the other lawyer’s client to really hear their concerns and begin to seek a peaceful resolution. This preparation might include delegating certain responsibilities to the client, and other responsibilities to the attorney, particularly in the opening session. For example, it is obviously better for the attorney to convey what facts will be proved in the trial, the legal strengths of the case, the rationale for the demand that has been made in the pleading or is being made in the mediation, and the confidence she has in being successful at trial. It is obviously better for clients to speak about how the dispute has affected their health, business, family, reputation, etc., and what the client really wants. This may be money, it may be an apology, it may be recognition for the harm that has occurred, it may be getting back their job or helping their company be more successful, or a combination of some or all of these. Whatever the true motivator for the position taken by the client is, it needs to be conveyed sincerely and respectfully but forcefully to the real decision-maker at the mediation: the other party.
One part of preparation for successful settlement is to do role-reversal. Mediators can even use this technique in a caucus with each side just prior to the joint session when mediators and parties typically make their opening statements. Assume you are in the caucus room with Corporate Counsel and the CEO of I.S.T., Inc, defendants in an intellectual property lawsuit. You might engage in this exercise: “John and Joe, have you thought of what the plaintiffs really want in this case? If you were on the other side of this dispute, what concerns, hopes and attitudes would be driving you to pursue this litigation? If we can step in their shoes for a minute, we will have a much better opportunity to create options that would met their interests and would also meet ours. It will also help us to create some trade-offs that would add value for both sides. Have you ever been the plaintiff in a similar case? Is it possible, for example, that they are concerned about recouping their research and development costs prior to the product being licensed to be sold by other companies? We could spend our time exploring how long it would be before they would be willing to license you to sell the product, whether they would grant you an exclusive license and what the licensing agreement would look like. If we could achieve an outcome in mediation that is more beneficial than pursuing the legal remedies, particularly if the jury decides they have the intellectual property ownership of this product, we should consider the benefits of that result. Even if we don’t take that approach, we still need to get into their hides and see the case from their perspective because only then can we come up with possible solutions to the joint problem we share. Unless we create options that meet their true interests, they will not say yes to us and we want to prevent this case going further due to huge legal costs, adverse publicity and the inherent risks of losing in complex litigation.”
THE REPRESENTATION PLAN
The consequences of inadequate preparation by advocates are clear and inevitable: the mediation will be prolonged, the risk of failure will be increased and the opportunity for a result beyond a win-lose, zero-sum scenario will be lost. At a minimum, the mediator will be compelled to spend time “educating” the advocate and her client on how to participate productively, particularly if the client arrives with rigid, unrealistic expectations based on the extreme positions in the pleadings. The most important task of the mediation advocate is to create and perfect a reasoned, tailored plan of representation specifically for the mediation. This plan includes the type of mediator you want to select, the information that should be included in the briefing paper, the goals and concerns that will be discussed in the pre-mediation conference, what the client and attorney will say in the opening session and how each will participate in the joint and caucus sessions. See, e.g., Harold I. Abramson, Mediation Representation: Advocating in a Problem– Solving Process, page 154, (NITA 2004). Use a checklist to help think through developing the plan and using it at mediation. Preferably, prepare a written representation plan that includes the following: 1) the negotiation approach - creative problem-solving; 2) stipulate goals - to meet the parties’ interests and to overcome barriers to settlement that have prevented an agreement in the past; 3) strategy - use the mediator’s power and presence to gain power for the client; and 4) implementation of the plan to use different techniques and approaches at different key junctures of the process (pre-mediation conference, first joint session, early and late caucus sessions, final joint session, caucus with other attorney and mediator without clients). Advocates need to be sure the representation plan advances the client’s underlying and true interests but also address the other party’s needs and interests. This is quite different from adjudicative processes, where meeting the other party’s interests would be irrelevant. Advocates must therefore be able to take off their “We are right and they are wrong” hat and put on the creative hat that stands for “Help us to help you by giving us enough information about what you want in order to create options that help both of us.”
PREPARING THE CLIENT FOR MEDIATION
Attorneys should emphasize that the mediation process is a continuation of the negotiation process, necessitating a conciliatory tone and a direct presentation to the other party. Most clients expect the attorney to speak in a zealous, adversarial way to the other attorney and the other party. Mediation advocates therefore need to work with the client to understand that this is an opportunity for collaborative, joint problem solving with the other side.
The best way to set that up is to re-interview the client about interests, impediments and options. The client should be asked to identify clearly what she wants to have happen at the end of the mediation. The client may not ever have thoroughly identified what her true, underlying interests and needs are. Ask you client to step into the other party’s hide - what does he really need in this case? Can that be given without high cost and would that set up a reciprocal obligation for the other party to give the client what she really needs?
This is an opportunity for advocates to probe and prod creative ways both parties can meet their real needs and perhaps even achieve mutual gain. It is important in this conversation to think outside the “legal box” - to be creative, innovative and free-thinking. See Abramson, page 233. Even if the previous demands have been made in monetary terms, this is the time to go beyond money to other types of options. In a surprisingly large number of cases, parties want something beyond money. The possibility of an exclusive licensing agreement on intellectual property, discussed above, is but one example.
In every case there are strengths and weaknesses and these must be discussed in a brutally frank way with the client: what is the probability of success in the court room, what is the most likely monetary outcome, how much will it cost to get there, and how much will it cost on appeal, whoever wins at trial. This decision - tree approach is the only honest way for the client to see the case not with rose-tinted glasses, but as a very expensive and risky business venture. In a more personal sense, the client must also be guided through an analysis of the personal cost to her and/or her company or family: the time, the publicity, the exposure to cross examination, the loss of reputation or good will, the frustration of losing and perhaps having to appeal the decision, and the loss of a continuing relationship with the other party. For some clients the chance to be vindicated in the courtroom or to establish a precedent is more important than the risk of trial. In other cases, the client can be helped to see that she would be better off taking $10,000 less in settlement than her best alternative to a negotiated agreement if it means preserving a continuing relationship with the other party. The lawyer cannot make that decision, only the client can. This type of pre-mediation preparation should always occur before, days before, not after the client and attorney arrive at actual mediation. These are but a few of the ways that mediators, clients and attorneys can enhance the effectiveness and results of mediation and will help all you mediators help your clients.
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