March 29, 2022 Practice Points

Victory Through Compromise: Lessons from Negotiated Settlements

A few considerations and strategies to keep in mind when preparing for battle in the negotiation arena.

By Elie C. Biel

Lose? I don’t lose! I win! I win! I’m a lawyer! That’s my job, that’s what I do.
          -The Devil’s Advocate (Regency Enterprises 1997)

Litigation is a competition. And as litigators, we are taught that our objective is to win. Winning—whether in the classroom, the courtroom, or on the field—is a matter of pride. We are trained to zealously advocate for our clients and “take whatever lawful and ethical measures are required to vindicate [our] client’s cause or endeavor.” ABA MRPC 1.3. In short, many of us are only taught to fight. Indeed, when our clients retain us, they often expect and demand that we do so.

But what is winning? For some clients, winning means total victory—vindication at trial or at summary judgment. But for others, winning may mean negotiating a settlement. Regardless of which version of the “win” the client wants, getting there requires strategic thinking, thoughtful preparation, and effective execution of the plan. It would be folly to try a case without adequate preparation. The same is true when mediating a case or negotiating directly with opposing counsel. To that end, when preparing for battle in the negotiation arena, below are a few thoughts to consider.

  • Compromise Means Giving Something Up. Many people often approach settlement discussions the same way as they would if arguing their case to a jury. Don’t. Lawyers are not impartial jurors. They’re biased advocates. As a result, don’t go into a negotiation expecting the other side to finally see the light and admit total defeat. Your opposition is there because they, too, think their perspective is valid. Accordingly, you need to validate that perspective and be willing to make concessions. If you and your client are unwilling to give an inch, your chances of settling are slim.
  • Be Prepared. Know your facts. Know your claims. Know your governing law. If you go into a negotiation without having a firm grasp on all of the above, you run the risk of looking foolish and losing credibility. It’s immensely hard to convince your opponent that you’re holding all the cards if you don’t know how many cards are in the deck. Lawyers love to be the smartest ones in the room. Prove it by being prepared.
  • Be Honest. No case is without weakness. In fact, most cases have some significant factual, legal, or jurisdictional weaknesses. Acknowledge those weaknesses. Start by admitting the obvious—all litigation carries risk—and go from there. Doing so will enhance your credibility and make you appear reasonable, traits that are invaluable when trying to negotiate a settlement.
  • Let the Other Side Save Face. I know, we all want to defeat our opponent. But when it comes to negotiating a settlement, your objectives must be different. While we may relish the moment when our opponent finally makes major concessions after recognizing that their hand is weaker, those concessions often come at a cost; namely, pride. As a result, sometimes the best way to get the job done is to give your opponent an opportunity to save face. There are many ways this can be done, but one option when you’re within striking distance of settlement is to give your opponent the last word and meet them where they are, e.g., accept their offer instead of insisting that they accept your offer. It may seem trivial, but sometimes this little gesture makes all the difference in the world.
  • One Size Does Not Fit All. People negotiate in different ways. Some people prefer to just throw numbers back and forth. Some like to provide lengthy narrative explanations in support of their offers and will bristle if you: (1) don’t give them the chance to explain themselves; or (2) respond in kind. Some people like to propose brackets (a.k.a. high/low or ceiling/floor). And some people like to make percentage-based moves (e.g., both parties agree to adjust their values up/down by 10 percent). The point is, there is no perfect way to negotiate a settlement, so be flexible. After all, some people may be more open to persuasion if you simply employ a different tactic.
  • Do Not Exceed Your Authority. Do what your client tells you to do. If you’re unsure whether you have permission to act, then ask. Period.

The above is hardly an all-encompassing list of considerations but they are strategies that I often employ when attempting to resolve disputes before trial. Good luck!

Elie C. Biel is an associate at Faegre Drinker Biddle & Reath LLP in Minneapolis, Minnesota.

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