Defining Your Win and Getting to Your End Game: How and Why to Conduct an Early Objective Case Evaluation (OCE)

Many say a good mediated settlement is one in which the parties to the agreement are unhappy.  The mediated settlement is good because the agreement achieves finality and avoids the cost, burden and uncertainty of a litigated and unpredictable outcome.  The parties are unhappy because they perceive the cost of that finality as an unfair result.  The more unpredictable the outcome and greater the risk the more the parties must give in return for finality and the greater the perception of unfairness. 

Mediating under these circumstances is akin to operating in a black box.  There is much you don’t know and there is much more that you don’t know that you don’t know.  Because the outcome and risk is unpredictable, and there is risk in pursuing it, it is more challenging to achieve an outcome that advances, rather than compromises a party’s interest. This is why many mediations fail and why many parties that do reach a mediated agreement are unhappy.

It doesn’t have to be this way.  Parties can win at mediation by advancing and not compromising their interests.  Conducting an Objective Case Evaluation changes everything because it helps parties mitigate the risk of the unknown; it enables parties to define the win or desired outcome; and, it enables parties from the beginning, to clearly set the strategy for winning, no matter how that win is defined. 

For those whose instinct is to fight to the death when a dispute arises, conducting an objective and early case evaluation is even more important as it will help avoid making critical mistakes and will enable the party to control the cost and outcome of the litigation. 

How and Why Does an Objective Case Evaluation (“OCE”) work? 

An OCE works because it: (1) it assists parties in fairly and objectively laying out what is known and what is not known about the situation; (2) it assists parties in determining what else needs to be known and understood to fairly analyze the risk; (3) it assists parties in determining the time, cost and means of obtaining and analyzing the unknown information and setting a fixed cost to obtain that information; (4) once the cost and risk is known the win is able to be determined in light of actual not perceived risk; (5)  the strategy to obtain that win is now also able to be determined with confidence; and (6) because the win and the strategy to get to the win is determined the cost to achieve the win can now also be fixed. In other words, a party is now able to control what most litigation lawyers say can’t be controlled -- cost and outcome.

To be effective, an OCE should go beyond just the relevant legal claims and defenses and a superficial understanding of the facts. An early deep dive that also considers the context beyond the four corners of the complaint is required. For example, determining the impact of various potential outcomes on stakeholders not parties to the litigation or considering the situation from a regulatory perspective and the court of public opinion may be critical in defining the win. 

Because so much becomes known through the OCE process, a party comes out of the black box and with eyes wide open is able to determine whether a mediated settlement proposal advances rather than compromises its interest and can negotiate during a mediation with confidence. 

Investing in a thorough Objective Case Evaluation is even more critical when the dispute is litigated. One reason litigation is so costly for parties is because many lawyers do little to understand the facts, context and impact of the dispute early.  These lawyers handle litigated disputes in the way children paint by numbers. The lawyers learn the case as the litigation goes along.  Discovery is drafted.  Documents are produced.  Witnesses are eventually identified and deposed. But the lawyers don’t really interview the key witnesses or review and understand the documents until after they are produced to the other side and reviewed in the context of preparing witnesses for depositions or studied in the course of preparing motions.  By waiting to understand how the pieces fit together lawyers develop themes and take positions early that are inconsistent with the actual facts and which destroy the party’s credibility. The result in an expensive and inefficient process in which critical mistakes are more likely to be made.

When this happens, and it happens all the time, the client is told (and usually just in advance of a scheduled trial) that the risk profile of the matter has changed for the worse and an expensive settlement instead of trial is now recommended. The lawyer doesn’t accept responsibility for the change in strategy saying instead “the facts changed.”  But the facts didn’t change they were just understood at the end of the litigation process instead of at the start. 

In summary, what a party doesn’t know and can’t predict about the outcome of a dispute creates a perception of risk which may or may not correlate to actual risk. The greater the uncertainty of the outcome the more likely a party will compromise its interest in favor of finality or engage in a burdensome and unpredictable litigation process. To ensure the win, the dispute should be managed through an Objective Case Evaluation process and, the earlier, the better.  As a party you will be able to define your win and confidently execute your strategy while avoiding costly and outcome determinative mistakes.