What's In Your Briefcase: Preparing for Your First Mediation - ABA YLD 101 Practice Series

By Caroline M. Iovino

It was December 15, roughly 3 months after I had been admitted to the bar when the partner I was working with on a products liability case asked me to handle the mediation. I was both flattered and excited by the opportunity; and at the same time a little bit nervous about what to expect having never actually attended a mediation before. I knew the case well. I drafted the answer to the complaint and all of the discovery. I had taken all the depositions. I prepared the investigation plan, issued subpoenas, and reviewed the records we received in response. I felt confident that I knew how to value the loss. What I was unsure about was how to convince the opposing party that my valuation was accurate. My first step to that end was selecting a mediator that could help me accomplish my goal.

I took great care in selecting a mediator. I asked other attorneys in our firm who they preferred, especially someone with products liability experience. I knew that I would need the mediator to help communicate the valuation of the case and the controlling law, not only to opposing counsel, but especially to his client. After some research, I was able to settle on a mediator that I felt comfortable with and who was also acceptable to opposing counsel. We then selected a mutually convenient date, and I began preparing for the mediation.

I meticulously drafted a pre-mediation report to our client outlining the strengths and weaknesses of our case, and the anticipated outcome should the case be taken to trial. I then prepared a separate report to the mediator describing our case and why we thought that a jury would be swayed in our favor. Of course, I was careful to leave out any privileged or confidential information that I had shared only with my client.

Mediation day arrived. I was anxious that morning; concerned about my lack of experience, but eager to prove myself up to the task. I dressed smart, with a pressed white shirt a navy suit. I packed up my briefcase and strode confidently into the mediators office. It was there that I met with my client for a few brief moments before mediation to discuss our strategy moving forward.

When all parties had arrived we were escorted into a large conference room with a long granite table. Seated on one side of the table was opposing counsel and his client, at the head of the table was the mediator, and seated next to me was my client. The mediator announced that she had received mediation statements from both parties and had reviewed them. She then made her opening remarks to all present. She explained to our clients about the mediation process and gave a little history of her own experience. It was then that each party was asked to present their case to the opposing side.

I did not realize at the time, what a great opportunity mediation was for us, the attorneys, to speak with opposing counsel’s client face to face. There was no other opportunity for us to actually communicate with the opposing party directly, as all communications were transmitted through counsel. This was the first opportunity to look the opposing party in the eye and explain what we saw as the weaknesses and shortcomings of their case. It was equally informative to gain some insight into opposing counsel’s impressions of our case, and if he were not too guarded, maybe even some of his trial strategy that could be used in later preparation if the case did not settle.

The most encouraging part of this dialogue was the knowledge that absolutely nothing that we said during the mediation conference could ever be used outside of the room. After all, mediations are completely confidential. If liability was admitted for the purpose of mediation, that admission could never be used in trial.

After each party had presented their case, the mediator asked if there were any questions from either side. She then asked a few pointed questions of each party and their counsel. Plaintiff presented the opening demand, and defendant asked to retire to a separate room to discuss the demand and come up with a counter offer. The mediator first met with defendants to see what they were willing to offer in response to plaintiff’s demand. As both parties were now segregated into separate rooms, the mediator would trek back and forth between the parties communicating numbers and messages to help the parties move toward a mutual settlement.

It was while the parties were broken up into their separate rooms in caucus that I learned my first and most invaluable lesson about mediation: always be prepared. As my client and I sat in caucus, waiting for the mediator to return and discuss how opposing counsel responded to the last round of negotiations, my client asked me certain questions about our case. I opened up my briefcase and proudly extracted the mediation report I had prepared with all the case facts. My client then asked me a question about the pleadings. I again reached into my briefcase and emerged with the complaint and the answer. Things were going so well. We were engaged in this great discussion. I felt so prepared!

My client then asked me a very specific question about something we had learned in discovery. Again I opened up my briefcase searching for responses to interrogatories that were previously propounded. I did not have them with me. Not dismayed, my client requested to see photographs of the loss.

“Uh oh,” I thought to myself. “I don’t have any photographs with me,” I reluctantly admitted. My resourceful client said, “No problem, just show me the engineering report.”

“Urr, uhm, well I didn’t actually bring that either,” I said sheepishly.

My client then looked up at me, his head resting on his hands, his face pointing downward toward the table, while his eyes peering up through thick lenses mounted on a wire frame. “So, what exactly do you have in that briefcase of yours?” he said as his head gestured toward the impressive vessel my prideful expression previously touted as being the citadel of all weapons necessary for this event.

THAT is the question that resonates in my ears eleven years and literally hundreds of mediations later. Although on that day we both knew the answer was obviously “nothing useful,” I assure you that moment, that feeling, never happened to me again.

My first mediation taught me a lesson that has later served to help me settle dozens of cases. Unless my case file is excessively large, I always bring my entire file to mediation because you never know what the issue might be that is going to be the sticking point for either side. When that issue arises, it is the most rewarding feeling to pull out the document that illustrates your point and reminds the opposing party that their emotional memory is not as accurate as what you have in your hand. Have all the information that you need at your finger tips to counter any argument that you get from the other side, or the mediator, regarding the strengths and weaknesses of your case.

In no other circumstance will you have control over the outcome of your case. Every other resolution of a case is either in the hands of the judge, a jury, a panel of arbitrators, or some other sounding board. Mediation is the only opportunity [formal proceeding] that allows you to determine the outcome of your case with certainty. As most attorneys I know are absolute control freaks, I am sure this is starting to sound pretty good to you.

Plan for a successful mediation
There are certain steps that you can take to ensure that the outcome of your case, as determined in mediation, is the absolute best result you could ever obtain for you client. Those steps include: 1) completing sufficient discovery before going to mediation; 2) managing your client’s expectations; 3) selecting a strong mediator; and 4) employing creative mediation strategies.

Pre-Mediation Discovery
“Sufficient discovery” is going to be determined on a case by case basis. In some cases you will be able to determine pretty quickly what the damages are without the need to retain experts. It is ideal to mediate such cases before investing so much money into discovery that you have made it economically infeasible to settle.

Other cases that are more complicated and require an expert’s help are best mediated after you have completed most discovery and consulted with your expert. Once you are confident that you have sufficient information to fully value the case for either side, the next step is to have a candid discussion with your client about the strengths and weaknesses of the case.

It is very important to manage your client’s expectations. Although rare, this might be the one case you believe, with one-hundred percent certainty, will be decided in your favor, you may not even want to mediate. You may only be attending mediation because the court has ordered you to do so. In that fantastic (I use the term in its literal sense) scenario, you may demand so much money that you know it will be impossible to settle. Inversely, you may offer one dollar knowing it will not be accepted. In this circumstance, your client will not mind paying you generously for the time you spent prolonging the litigation.

Get Real About Valuation
However, as with 99.9% of the cases that I have ever litigated, if there is some risk of exposure, or potential for no recovery, you need to apprise your client of the real risks. If the fate of your case is to be left in the hands of six people whose minds you cannot read, there is never 100% certainty in anything. It is then that you have to be realistic about the worst possible exposure, or the least possible recovery, and communicate this potential to your client. You also have to apprise your client of the litigation costs involved if the case does not settle, and goes to trial. Another factor to consider is whether there is a risk of setting a bad legal precedent, or whether you in fact need to use this case to set precedent for the future. All these considerations should be factored into a cost/benefit analysis to determine whether to settle, and if so, establish a good settlement range.

Mediator With Muscle
So after you have had this candid conversation with your client and you have ultimately determined what your case is worth, the next step is to select a mediator that is going to help you accomplish your goal. The best mediator for your particular case is someone who has experience with the same area of law as your case. A good mediator is able to create an environment where constructive communication can happen. An effective mediator is able to identify the sticking points for each side. She is going to honestly communicate to all parties both the flaws and the weaknesses in their cases as well as the strengths. It is always more effective for opposing counsel and their client to hear their case’s weaknesses from an impartial third party than from you. On the flip side, sometimes you and/or your client need to hear from and impartial third party why your case is not as strong as idealized. Therefore, selecting a mediator who will create a comfortable environment, yet be strong enough to communicate difficult messages is the person who can get the case settled.

Don’t Get Boxed In
Come to mediation with a game plan. Know what your demand/initial offer will be. Also know going in, what is your absolute bottom line. These are conversations you should have with your client before mediation. Of course, you must be flexible as nothing is written in stone. The focus of your mediation strategy is to get the opposing party moving toward a number that is somewhere in the vicinity of both side’s bottom line. The saying goes that “a successful mediation is when one side accepts slightly less than they wanted, and the opposing side gives slight more than they wanted.” Nothing could be truer. Compromise is the name of the game. No one leaves 100% percent happy or gets 100% of what they want.

Although often exclusively monetary, settlements can include other non-monetary compensation. Do not be afraid to get creative in settlement negotiations. Often times, lawsuits are just as emotional as they are fiscal for the parties. When funds are lacking, other concessions may be sufficient to get the job done. These can run the gamut from free goods and services to a simple apology. Do not be limited by convention. Use the mediator to help you determine what is motivating your opposition. Psychology can be as important to a successful mediation as a well-drafted brief. Remember, the beauty of mediation is having control over the outcome of your case.

Let’s Make A Deal!
So now you have established a game plan with your client and you have selected a strong mediator. You have drafted your confidential mediation report to communicate your impressions and your goals to the mediator. You are attempting to settle your case, but will you be successful? Here are some mediation tips.

First of all make sure that the person you are bringing with to mediation is a person authorized to make a decision on behalf of your client. Likewise make sure that the person that has come with the opposing counsel to the mediation is a person who is authorized to make decisions that needed to be made to settle cases. People who are decision makers are people that have authority to spend as much money as required to settle the case or people who have authority to decline or accept the money being offered. In some circumstances it is impossible to get all of the decision makers there in person. In those cases, upon agreement of counsel or by court order, decision makers may appear telephonically or via other virtual media.

Depending on the complexity of the case how far apart the parties are and how difficult the parties are, make sure that you set aside enough time for mediation. Some cases can be resolved in an hour, where some cases involve 20 or more parties and may take a week or more to mediate. Worst case scenario, if a settlement agreement is not reached during the time that you have set aside for mediation, the parties can agree to continue the mediation to a later date and time and reconvene without declaring an impasse.
In difficult mediations, some mediation strategies may be utilized by the mediator. One mediation tool I favor is a “bracket.” When the parties are far apart, a bracket is a good tool to determining whether the parties will get close enough to settle the case. The mediator may suggest that if the plaintiff is willing to lower its demand to x, then the defendant will increase its offer to y. If negotiations are moving slowly, this is a good way to stimulate some quick movement.

In extremely difficult mediations, even after a bracket has been employed, the parties will not be able to agree upon a number. In these instances, the mediator may ask that you not declare an impasse yet. She may ask that you give her some more time to work on a resolution. She will then call each party over the next several days and continue negotiating. I have experienced many cases being resolved in this manner. After a long day of mediation, people become irritable and frustrated. Sometimes the perspective gained after a break and a good night’s sleep is all it takes to get the parties motivated to resolve the case.

Conclusion
The benefits of mediation are obvious: time and cost savings. A case that could take years, and hundreds of thousands of dollars to litigate, could potentially be resolved in a matter of hours with effective mediation. Secondly mediation offers the opportunity to settle disputes with confidentiality and privacy. Where a courthouse is a public institution and all lawsuits and information filed in the courthouse is generally open to the public, mediation is completely confidential. Therefore, it is the perfect opportunity to foster candor and open dialogue between the parties. It is also a great opportunity to discover information and discuss issues that parties would normally not be willing to converse with each other for fear that it would be used against them in the future. Third and most importantly, mediation is the only opportunity to actually control the outcome of your case. In any other situation the outcome of your case is in the hands of someone else. When mediating, the ultimate decision of what you are willing to pay, or willing to accept as payment and terms, is in yours and your client’s hands.

Enjoy the process; use it as an opportunity to learn more about the law, about people, and especially about your client.

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