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The quid pro quo of mediation

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The quid pro quo of mediation

Source: Plaintiff Magazine
Date: July 2011

Jerry Spolter, Esq.
BY JERRY SPOLTER When the plaintiff’s attorney ade- quately prepares and gives the mediator – and the other side – what they need well in advance of the mediation, there is no reason that every case shouldn’t settle on acceptable terms at the first mediation ses- sion. When I started mediating back in 1985, mediation was in the infant stages and “trial” attorneys snubbed their noses at the concept of even suggesting media- tion as it would be perceived as weakness. Today’s savvy litigator knows that he/she will mediate 25 cases to every one that is tried to a jury. Consequently, 3,000-plus mediations later, the following outline of do’s and don’t’s is borne from this former litigator’s real-time perceptions of what successful practitioners do to maximize their clients’ opportunities to settle on fa- vorable terms at the first mediation session. The fatal flaws There are three primary reasons that mediations fail to resolve at the initial me- diation session: 1. Insurance and Coverage Issues are not addressed/resolved in advance of the mediation; 2. One of the critical party’s decision- makers is not in the room and/or has not acquired adequate authority in ad- vance of the mediation; and 3. The plaintiff’s counsel has failed to ascertain and provide all the necessary information and documentation to the other side(s) well in advance of the me- diation. The above fatal flaws are so painfully obvious that it amazes this mediator that time and again at least one of the three surface during the mediation. And whose fault is this? Plaintiff’s attorney. Do not schedule a mediation until all three of the above fatal flaws have been adequately The quid pro quo of mediation Eliminate obstacles, prepare thoroughly and give the other side what they need so that you will get reasonable case value the first time around “…the tumblers fall into place and the lock will open.” Copyright © 2011 by the author. For reprint permission, contact the publisher: www.plaintiffmagazine.com 1 www.plaintiffmagazine.com JULY 2011addressed well in advance of the prospec- tive mediation date. • Insurance coverage You want the several defendants and multiple insurance interests to have their ducks in order (i.e., coverage issues re- solved) before you pay several thousand dollars to come to the mediation and chill in a separate room for hours while the de- fendants argue over who has the obliga- tion to pay for plaintiff’s damages. It is not uncommon for plaintiffs to “waste” a day at mediation while the multiple defen- dants with numerous insurance policies argue over implied and contractual in- demnity, additional insureds, horizontal and vertical coverages, and numerous other coverage disputes. How can the plaintiff’s attorney ad- dress this in advance of the mediation? Easy. Ask defense counsel if all coverage is- sues have been addressed and resolved. If not, then suggest that defense counsel and their competing coverage attorneys arrange a “pre-mediation” mediation to iron out the coverage disputes. (Insur- ance coverage obstacles often arise in mold, sexual abuse, construction-related personal injuries, products liability and nearly all multi-party cases.) Another question: Are there claims outside of coverage (e.g., punitive dam- ages) for which the carrier has issued a “reservation of rights”? If so, inquire of opposing counsel whether the insured has acquired “personal counsel” who will be attending the mediation. (Defendant’s personal counsel may prove to be your most valuable ally at the mediation — and someone whom you will want to identify and communicate with in advance of the session.) • Missing person(s) This is what is known as the “invisible hierarchy,” the Mr/Mrs Bigg back at the insurance company or decision-making en- tity who is NOT in the room (and there- fore devoid of context), but is calling the shots. What good is the mediation session if, after showcasing your plaintiff, finest ev- idence and most eloquent argument, the real decision-maker isn’t in the room and, worse, won’t pick up the phone and listen to the attorney and representative who has been sent in his/her stead? How often do we find toward the end of the mediation that the “invisible hierarchy” has either left the office and is not available or simply won’t listen to his/her counsel, representa- tive or the mediator? Talk about frustration! And whose fault is this? Plaintiff’s counsel. How can it be remedied? Easy. Before setting a date and writing a check for your share of the media- tion fees, call opposing counsel and confirm in writing who the carrier’s or company’s representative will be at the mediation and confirm that that person will have the horse- power to make a deal. (It is astonishing how often plaintiff’s counsel has no clue who the carrier is – doesn’t anyone read the 4.0 rogs? – and whether there is excess coverage, or failed to follow up with an ambiguous/eva- sive response to 4.0.) There will be times that certain de- fendants simply will not agree to allow the critical decision-maker to travel/ attend the mediation. That is not totally surpris- ing in view of either the value of the case and/or other economic/\scheduling con- cerns, but the plaintiff’s attorney should not agree to mediate without first obtain- ing something in writing from defense counsel assuring that the file has been ad- equately reviewed and that the defense rep will be available by phone during the entire mediation and on speaker phone for the joint session, if requested. There is no reason that the plaintiff decision-maker be present if the defense can’t reasonably assure plaintiff’s counsel that the defense equivalent will also be participating. (I often hear plaintiff’s counsel lament the “bad faith” of the de- fense for failure to have “adequate author- ity” at the mediation. My response is that the plaintiff’s counsel should never have agreed to mediate without adequate assur- ance in advance from defense counsel that the right person will be in the room — or on phone standby — and that the de- fense has adequate information and has had adequate time to acquire appropriate settlement authority.) • Don’t hide the ball Since the plaintiff has the burden of proof at trial — as they do at the media- tion — why in the world wouldn’t a compe- tent plaintiff’s attorney ensure that the other side has all the information neces- sary to properly evaluate plaintiff’s case and acquire appropriate settlement au- thority well before the mediation date? It still astounds me that some plain- tiff’s attorneys do not share their media- tion briefs with the other side. Huh? Don’t you want the other side’s decision makers to understand the facts, law and argument of how plaintiff intends to prove liability, causation and damages? Plaintiff’s coun- sel is always welcome — and, in fact, en- couraged — to submit a separate “confidential” brief to the mediator ad- dressing any sensitive legal/factual/per- sonality matters. It bewilders me, however, that when I arrive at a mediation, after having digested an excellent plaintiff’s mediation brief replete with well reasoned argument and supporting docu- mentation, I find it wasn’t exchanged with the other side. Why not? Don’t you want the other side to understand what an ex- cellent case and well prepared, articulate attorney your client has? Lastly, since we’re on the subject of the pre-mediation checklist, make a phone call to opposing counsel and in- quire of him/her: “Do you have every- thing you need to be able to intelligently evaluate and negotiate at the mediation?” You don’t want to get to the mediation and find out that the defense needs a criti- cal deposition or a defense medical exam or documentation of wage loss, etc. Make the call — or even take opposing counsel out to lunch to discuss the case — to en- sure the other side has done all its home- work and will be ready to engage in meaningful negotiations at the mediation. Now with coverage issues satisfactorily addressed and with the opposing party’s settlement authority accounted for, let’s dig down to get the brief, and you — yes, plaintiff’s counsel — and the client ready for the mediation. Copyright © 2011 by the author. For reprint permission, contact the publisher: www.plaintiffmagazine.com 2 www.plaintiffmagazine.com JULY 2011The mediation Three elements influence the out- come at mediation: 1. The attorney’s written brief; 2. The attorney; and 3. The client. The quality and interplay of these three components will determine the de- gree of success, mediocrity or failure of your client’s case. There is an adage that any plaintiff’s attorney can turn a $5 million case into a $3 million case; it is the exceptional plain- tiff’s attorney that converts the $5 million case into an $8 million settlement. The ex- ceptional negotiator achieves exceptional results. Poor negotiation skills are mani- fest when the plaintiff’s attorney leaves substantial money “on the table.” What plaintiff’s counsel needs to do to succeed is provide opposing counsel everything needed to intelligently evaluate your client’s case, plus add equal doses of credibility, ethics and trustworthiness. The brief Recognize that the purpose of the brief, while it is being addressed to the mediator, is written to persuade the other side. The brief may be the first opportu- nity that you have to package your case and penetrate beyond opposing counsel to reach the actual decision-maker who is holding the defendant’s purse strings. A sloppy brief (replete with typos and dan- gling participles), submitted late and with argument unsupported by law or evi- dence, will not only be unpersuasive, but will send the wrong message from the start. It is in the brief that the attorney sets forth the summary of the facts, applica- tion of the law and exposition of damages. It is in the exhibits that the attorney’s statements derive their credibility and per- suasive force. For example: • Support statements of the law not only with legal citations, but also with highlighted copies of applicable jury in- structions, appellate decisions or, if “negli- gence per se” is being asserted, applicable statutes, ordinances or regulations. • Discussion of injuries and surgical proce- dures should be supported graphically with anatomical charts, medical illustra- tions reflecting the various steps of the surgery, reverse positive X-ray photo- graphs depicting location of residual hardware and footnotes or parenthetical definitions of medical or technical terminology. • Statements attributable to witnesses should be supported by highlighted depo- sition testimony excerpts, written state- ments, declarations under penalty of perjury, police or other official reports. (Do not attach entire depo transcripts to your brief; just the highlighted, critical ex- cerpts.) • Allegations as to what the future holds — e.g., future surgery in a personal injury case or loss of profits in a patent infringe- ment case — must be supported by an ex- pert’s report and, incidentally, include the expert’s curriculum vitae for the reader’s ready reference; • Photographs, diagrams and illustrations can miraculously convert eight paragraphs of complicated text into the reader’s mind’s eye of your view of the case. (It is becoming common, and proving very ef- fective, to integrate the photos, diagrams and demonstrative exhibits into the body of the brief where a pertinent issue is being addressed.) • Present objective sources to establish case value, e.g., reported verdicts and set- tlements of similar fact patterns in similar jurisdictions, articles discussing similar cases or, preferably, verdicts or articles ad- dressing your (or your firm’s) trial accom- plishments. (An attorney’s personal opinion as to the value of a case carries lit- tle weight, whereas his/her proven trial track record in similar cases is worth its weight in gold.) Exhibits are limited only by your imagination. No statement should be made without some document in support of it. Send two copies of the brief at least two weeks in advance of the mediation to opposing counsel: the extra one to be forwarded without delay — and with no risk of poorly copied exhibits — to the principal/decision-maker. (In today’s elec- tronic age, particularly where so many businesses and insurance carriers are “pa- perless,” the brief sent in “pdf” format to opposing counsel will achieve your goal and save a tree at the same time.) When issues are raised in the brief that you receive from opposing counsel, consider addressing them prior to the me- diation in a supplemental brief, again, with supporting documents. Once the written brief is complete and received well in advance of the media- tion, that attorney’s stature as a prepared and well-reasoned negotiator will have been established. Now that component No. 1 has been locked in, elements two and three come into play: the attorney and the client. The attorney The first 10 minutes of a mediation are crucial in terms of attitudes expressed — verbally and nonverbally — and the tone that is set for the balance of the day. Attor- neys who “smile when they talk,” explore a common ground for “small talk” unre- lated to the mediation (kids, sports, travel, diets, current events) and exhibit coopera- tive and trustworthy signals, quickly pro- mote a “We can get this thing done” atmosphere. On the other hand, counsel who arrive at the mediation with an en- tirely different position than last commu- nicated (e.g., a plaintiff’s attorney who had previously demanded $150,000 now demands $330,000), or present last- minute documents or expert reports, will offend their opponents and seriously di- minish any chance for success. One successful plaintiff’s attorney told me that he perceives his job as fol- lows: determine what the defense needs to document their file or to answer their questions, then provide that information in a timely manner “…so that each of the tumblers falls into place and then the lock will open.” There is an expression: “Honey goes further than vinegar.” Attorneys who adopt Copyright © 2011 by the author. For reprint permission, contact the publisher: www.plaintiffmagazine.com 3 www.plaintiffmagazine.com JULY 2011offensive, argumentative, bombastic and/or arrogant styles at mediation do not serve their clients well. Attacking your op- ponent, their witnesses or representatives generally does not endear you to the other side, nor does it either foster an exchange of information or promote a desire to do business with you. On the other hand, the negotiator who concedes the weaknesses of his/her case and acknowledges the strengths of the opponent’s case, gener- ates immediate respect and credibility with the by-product of encouraging equivalent behavior from the other side. At the mediation’s joint session (a subject worthy of its own article address- ing case appropriateness, timing, etc.), the attorney’s opening comments should be those of a forceful advocate and should address the most important facts and is- sues of the case. The use of diagrams, PowerPoint™ presentations, select por- tions of video depositions, photo enlarge- ments and expert witnesses (in person, by videoconferencing or speaker phone) are all worthwhile tactics to facilitate the other side’s understanding of the critical points in your case, and to demonstrate your pro- fessional abilities and financial commit- ment to your client. (The reader should review the article by Cogent Legal’s Mor- gan Smith entitled “Go Graphic in Media- tion, Not Just in Trial” which appeared in last month’s Plaintiff Magazine.) As for “smoking guns,” whether to reveal them is a matter of strategy that often depends on the smoking gun- toter’s perception of the other side’s credibility, willingness to share informa- tion and whether the gap in negotiation is sufficiently narrow to warrant release of key surprise evidence. Good negotia- tors know how/when to divulge them, and it is always worth soliciting the advice of the mediator. The client The third component in the equation is the plaintiff. Counsel should assiduously prepare plaintiff for the mediation session so that he/she knows what to expect and what to say and what not to say. What a party does is often as impor- tant as what the party says, so instructing your client on the basics of body language and non-verbal behavior is every bit as im- portant as the old standby to “stop talking if I kick you under the table.” (For exam- ple, the client who says, “I want to go to trial,” while shaking his head “no,” betrays the attorney’s expressed bravado of going to trial at all costs.) It is often said that “plaintiff is Ex- hibit A.” Therefore, the plaintiff’s conduct — nonverbal as well as verbal messages — can have an enormous impact on the out- come of the negotiations. Although there are a few rare circumstances where an at- torney may want to put a sock in his/her client’s mouth, the client who has been well prepared in advance of the mediation can definitely add value to the case. (It frustrates the mediator when a plaintiff’s attorney won’t let the client speak in a joint session, and then in the private cau- cus the client’s warmth, honesty, sincerity and genuine sense of loss shine through. This missed opportunity cannot be con- veyed by the mediator in the private ses- sion with opposing counsel in the same way that spontaneity in the joint session would have.) The plaintiff and his/her attorney are a team, and perceived as “one” by the folks on the other side of the table. Any deficiency of one attaches to the other. The overdramatized limp, the exagger- ated wage loss, the feigned neck rubbing and the disingenuous claim, especially when combined with expressions of hostil- ity and personal vindictiveness, will quickly turn off the folks with the money. On the other hand, a warm handshake coupled with a touch of stoicism and gen- uine likeability on the part of the plaintiff can maximize settlement value at the mediation. Quid pro quo If you follow the foregoing compre- hensive checklist, then you will have the combination to successfully mediate your case as “…the tumblers fall into place and the lock will open.” From personal experi- ence, my mediator’s translation of “Quid Pro Quo” is: Eliminate obstacles, prepare thoroughly, and give the other side what they need so that you will get reasonable case value the first time around. Jerry Spolter is a full time mediator with JAMS The Resolution Experts in the San Francisco Res- olution Center. Jerry was formerly a trial attorney who is a member of The American Board of Trial Advocates and formerly a member of the National Board of Trial Advo- cacy. He has mediated more than 3000 cases since 1985. He was SFTLA’s Mediator of the Year in 2000. He is consistently named a Top Neutral by The Daily Journal and was Named #1 Neutral in the Bay Area for two con- secutive years in The Recorder’s 2009 and 2010 annual polls. He can be reached at jspolter@jamsadr.com. Copyright © 2011 by the author. For reprint permission, contact the publisher: www.plaintiffmagazine.com 4 www.plaintiffmagazine.com JULY 2011 Spolter