Time for Family and Thanks

Towards the end of this luxuriously long holiday weekend, I am mindful of the power of time for reflection and the strength of family ties. In year's past, it has not always been so. Sometimes the crush of a desire for the perfect Thanksgiving feast, the conflict of spending the holiday with one or the other family members, the rush to hit the sales on the day after Thanksgiving have effectively destroyed the opportunity for quiet reflection. This year, none of that got it my way. Perhaps the economic situation, or the massacre in Mumbai colored the long weekend and put our world into perspective. And so, with gratitude for the many blessings I have enjoyed, I offer a moment's reflection and hope that our world, given time, family and an opportunities for thoughtful reflection will improve. For me, I am thankful that we will have a new President in the White House who believes in dialogue and diplomacy, respects family and community and takes time for thoughtful reflection in all matters.

Four Important Qualities for a Mediator

Aaron David Miller's Op-Ed piece in today's Los Angeles Times caught my eye. He calls it "State of Mind" and recounts four important qualities for President-elect Obama to consider in choosing a Secretary of State. Miller worked for six secretaries of state over twenty years and is the author of the book pictured. In brief, he says to succeed a Secretary of State needs the right persona, the President's confidence, a negotiator's mind-set and some balance of deviousness and toughness. I see these qualities as equally vital to the success of a mediator.

Miller says the top diplomat "needs to be an actor, a teacher, a tactician, an intimidator and a confidant." Sound familiar? He describes the negotiator's mind-set this way: "Teenagers talk on the phone, beavers build dams, and secretaries of state manage crises and solve problems. This means having a smart and tough view of the world, seeing how America's ends and means can fit together, and then knowing how to make them do so." He calls the particular mind-set "the intuitive capacity to see where the deal is, and to put oneself in the middle of the mix to bring it about". This is a perfect description of what a mediator does.

And here's the part I've never seen printed, but that also weighs in heavily in the artful mediation: "Deception is sometimes required and they maneuver constantly, trying to figure out what's necessary to succeed and how to use incentives, pressure, arm twisting and, when necessary, untruthfulness (either by omission or commission) to manage a crisis or close a deal."

So thank you, Aaron Miller, for articulating the true qualities of an artful mediator or Secretary of State. I'm looking forward to reading your thoughts on solving that pesky Middle-East issue next and looking forward to learning of Obama's choice for the role!

A Rare Transformative Experience

Mediation isn't always measured by how much or how little money is exchanged. Last week, I had a wage and hour claim against an employer who was going to be unable to pay even a small percentage of the Plaintiff's demand. Nevertheless, this young woman was a part of the extended family of the former "employer". She had lived with the family for several years when she first came to this country and genuinely endeared herself to the "host" family until they had an apparent falling out--when she disappeared without saying goodbye and without explanation. It became obvious early in the session, that this matter was not going to be settled for anything close to the "value" and that neither side was adequately capitalized to try the case, given the slim prospect of collecting upon any eventual judgment. So I took a chance. I orchestrated a meeting with some of the family members (two sisters) and the Plaintiff. There were no attorneys present (except me) and the session was conducted in a foreign language (which I understood, but in which I did not contribute). There were tears (including mine!) and hugs and an offer to settle which was within a few hundred dollars of the ultimate resolution. Although nobody felt satisfied that the case had to be resolved in this way, it at least offered an opportunity for soothing old hurts, answering unasked questions and most importantly, given people a chance to make a gesture towards restoring relationships which may prove to be mutually beneficial in the future. If you can't get money, it's gratifying to see you can sometimes get hugs, laughter and even tears! This was a rather unique experience in my litigation-driven practice, but ever so rewarding to me and the other participants!

Ballroom Dancing for Lawyers

I mediated a couple of cases this week which unfortunately came to me after settlement conversations had begun. In each instance, one side refused to move off their pre-mediation demand by even a dollar. This lead me to the conclusion that lawyers may need legitimate ballroom dancing lessons. During my summer cruise, I actually took ballroom dancing lessons with my 21 year old son, and here are a few tips:
1) It is not good enough to get dressed and show up for the dance. You must get into position by the time the music starts.
2) It is not good enough to get into position and then stand in the same place. You must move your feet.
3) It is not good enough to merely kick or stomp your feet, you must attend to the rhythm of the music and the posture, mood and responses of your dancing partner.
4) It is not good enough to move always in the same direction: ballroom dancing is a give and take, back and forth, sometimes even circular motion--but motion (movement) is critical.
5) It is not your prerogative to dictate the song list: this is done by consensus, or by the band or your host. You've been invited to the dance and accepted the invitation, so be gracious and "go with the flow".
6) Starting the dance but then refusing to finish it if you don't like the tune is unfair. Both your partner and your host will be disappointed and may not invite you to dance again.
7) Ballroom dancing can be a complicated, even unfamiliar and intimidating event, but if you start with a simple box step, you'll be able to work on more complicated steps as the evening wears on. It takes practice, so don't expect mastery in the first lesson!

Okay--you get my point, I hope. Please consider these tips before you get to your next mediation. At the very least, I hope it will cause you to crack a smile when we begin "the dance"!

Good luck!

Settlement is Better than Trial

I read a fascinating article in last week's New York Times about the benefits of settlement over trial in litigated cases. I've re-published the whole thing here for you to read--but basically it suggests that after studying 600 cases where settlement was discussed, but the attorneys or their clients decided to "go for it" in most instances the results were not as good as they would have gotten at the settlements offered. Interestingly, there was a huge disparity between Plaintiff's "getting it wrong" and Defendants. On average, Plaintiff's would have done better by $43,000 per case had they taken the settlement offered, whereas Defendants would have saved $1.1 million on average! It certainly gives both sides a hearty incentive to give serious consideration to letting a good mediator take a crack at settling every case: or at least giving the realtiy test to your clients before proceeding to trial.

P.S.: I'm pleased to inform readers that the author of the study, Randall Kiser will be in Los Angeles at the upcoming Southern California Mediation Association's Annual Conference on The Brain and how Neuroscience affects Conflict Resolution. The conference will be on November 5, 2008 at Pepperdine's Straus Institute's Malibu Campus. If you'd like more information, send me an e-mail and I'll make sure you get an invitation.


By JONATHAN D. GLATER
Published: August 7, 2008/The New York Times
Note to victims of accidents, medical malpractice, broken contracts and the like: When you sue, make a deal. Avoid a trial, Randall Kiser advises.

That is the clear lesson of a soon-to-be-released study of civil lawsuits that has found that most of the plaintiffs who decided to pass up a settlement offer and went to trial ended up getting less money than if they had taken that offer.

“The lesson for plaintiffs is, in the vast majority of cases, they are perceiving the defendant’s offer to be half a loaf when in fact it is an entire loaf or more,” said Randall L. Kiser, a co-author of the study and principal analyst at DecisionSet, a consulting firm that advises clients on litigation decisions.

Defendants made the wrong decision by proceeding to trial far less often, in 24 percent of cases, according to the study; plaintiffs were wrong in 61 percent of cases. In just 15 percent of cases, both sides were right to go to trial — meaning that the defendant paid less than the plaintiff had wanted but the plaintiff got more than the defendant had offered.

The vast majority of cases do settle — from 80 to 92 percent by some estimates, Mr. Kiser said — and there is no way to know whether either side in those cases could have done better at trial. But the findings, based on a study of 2,054 cases that went to trial from 2002 to 2005, raise provocative questions about how lawyers and clients make decisions, the quality of legal advice and lawyers’ motives.

Critics of the profession have long argued that lawyers have an incentive to try to collect fees that are contingent on winning in court or simply to bill for all the hours required to prepare and go to trial.

“What I would want them to look at was whether or not the lawyers had a strong financial incentive to go to trial,” said Cristina C. Arguedas, a criminal defense lawyer in Berkeley, Calif., when told of the study. “I’m not suggesting the answer, because I don’t know, but that would be my question.”

The study, which is to be published in the September issue of the Journal of Empirical Legal Studies, does not directly answer Ms. Arguedas, but it does find that the mistakes were made more often in cases in which lawyers are typically paid a share of whatever is won at trial.

On average, getting it wrong cost plaintiffs at about $43,000; the total could be more because information on legal costs was not available in every case. For defendants, who were less often wrong about going to trial, the cost was much greater: $1.1 million.

“Most of the time, one of the parties has made some kind of miscalculation or mistake,” said Jeffrey J. Rachlinski, a law professor at Cornell who has studied how lawyers and clients decide to go to trial and who is co-editor of the journal. “The interesting thing about it is the errors the defendants make are much more costly.”

The study’s authors have analyzed some data from New York and, after a review of 554 state court trials in 2005, have found parties to lawsuits making the wrong decision at comparable rates.

The findings suggest that lawyers may not be explaining the odds to their clients — or that clients are not listening to their lawyers.

“It’s entirely possible that the attorneys are not giving adequate advice,” said Mr. Kiser, who is also a lawyer but is not practicing. “An attorney could advise a client that they have a strong defense to enforcement of a contract, but that is not the same thing as forecasting what the likely outcome at trial would be.”

As part of the study, which is the biggest of its kind to date, the authors surveyed trial outcomes over 40 years until 2004. They found that over time, poor decisions to go to trial have actually become more frequent.

“It’s peculiar if any field is not improving its performance over a 40-year period,” Mr. Kiser said. “That’s a troubling finding.”

Law schools do not teach how to handicap trials, nor do they help develop the important skill of telling a client that a case is not a winner. Clients do not like to hear such news.

“Most clients think they are completely right,” Michael Shepard, a lawyer at Heller Ehrman in San Francisco. A good lawyer has to be able to tell clients that a judge or jury might see them differently, he continued. “Part of it is judgment and part of it is diplomacy.”

Several lawyers were dismissive of the study, noting that the statistics mean nothing when contemplating a particular case, with its specific facts and legal issues, before a specific judge. They stressed the importance of a lawyer’s experience.

But the study tried to account for that possibility and found that factors like the years of experience, rank of a lawyer’s law school and the size of a law firm were less helpful in predicting the decision to go to trial. More significant was the type of case.

For example, poor decisions by plaintiffs to go to trial “are associated with cases in which contingency fee arrangements are common,” according to the report. “On the defense side, high error rates are noted in cases where insurance coverage is generally unavailable.”

The findings are consistent with research on human behavior and responses to risk, said Martin A. Asher, an economist at the University of Pennsylvania and a co-author. For example, psychologists have found that people are more averse to taking a risk when they are expecting to gain something, and more willing to take a risk when they have something to lose.

“If you approach a class of students and say, I’ll either write you a check for $200, or we can flip a coin and I will pay you nothing or $500,” most students will take the $200 rather than risk getting nothing, Mr. Asher said.

But reverse the situation, so that students have to write the check, and they will choose to flip the coin, risking a bigger loss because they hope to pay nothing at all, he continued. “They’ll take the gamble.”

The third co-author of the study was Blakeley B. McShane, a graduate student at the Wharton School of the University of Pennsylvania

Aggressive Diplomacy in Mediation

Barack Obama used a phrase which I thought curious this morning in response to a journalist's inquiry about nuclear capabilities by Iran. The phrase was: "Aggressive Diplomacy". When I was an undergraduate studying International Relations, such a term would have been considered an oymoron. Good diplomats were never "aggressive". Diplomats were clever, cautious, prudent, facilitative, skilled, smooth, adept--but not "aggressive". To the contrary, they were the folks called in to "mediate" when world leaders became or threatened to become aggressive!

My mediation style has followed that early training. I have always seen myself more of a good diplomat than an aggressive purveyor of peace or conflict resolution. Now that I consider it carefully, I might also reach the conclusion that my early training in "diplomacy" at Pomona College got in the way of being a fully aggressive litigator for the couple of decades I tried that approach.

Just for a challenge, I thought I'd exercise Obama's approach and aggressively pursue diplomatic efforts. Today, I mediated a dispute between a brother and sister who had not had much interaction since their mother died 13 years ago and they inherited the family home jointly. There were many moments when the parties, both unrepresented, nearly gave up. In this instance, I had to be "aggressive" in my pursuit of diplomatic relations to reach a detente between them and help them move on. I found myself consciously taking a proactive role in the way Obama outlined in the Middle East.

Coincidentally, I had the pleasure of running into my first "boss" at the office today (participating in another mediation). A colleague introduced me and said jokingly, "She couldn't have been trained by you, she's too nice." His response was "She was mean when she was litigating with me!". So here's the challenge: for thirty days, I'm going to make an effort to "aggressively" mediate every case. I will be more than a dipolomat. I will do whatever I can to settle every case, even those that are lingering on my credenza. I will consciously observe the effect on the litigants and whether they accept my taking on that role. Who knows? This could portend the new world order!

Independence and Interdependence: The Good Side of Court-ordered Mediations

This week marks the largest settlement I've ever "brokered" and the longest mediation over which I've presided thus far. A month ago, a compelling wrongful death and bad faith case came before me at the strong urgency of the Court. The case had a trial date of June 30, 2008. It was mediated back in 2005 (unsuccessfully and by a different mediator) and then had proceeded to a Motion for Summary Judgment which was granted in favor of the defendant and later reversed on appeal. While the mediation in May got a lot closer, the parties were still millions of dollars apart. Then came the daily phone calls, the true "negotiation", and the framing, re-framing, evaluating, re-evaluating for a full month. After one such conversation, the Defense lawyer advised me that he was instructed to put out his top dollar offer in a statutory offer. The negotiation continued. Last week, on the morning of the Final Status Conference, the Plaintiffs accepted the Statutory Offer which had been submitted 4 days before. While I take some credit for working with both parties to get to a number that would ultimately settle the case, I'm quite clear that the timing created by the Court (through both a trial date and a Statutory Offer) allowed the parties to finally end the negotiation and settle the case.

In another case, I was the presiding Arbitrator. The parties had spent hours and hours disputing and debating the claims, the damages and the discovery in advance. Finally, when they came before me last week, my preliminary ruling was to overrule the Plaintiff's objection to the Statutory Offer being used in an arbitration. Then I simply queried: "Would the parties like to take a few minutes to discuss possible settlement in light of that ruling?" Within 2 hours, that case also settled. It was only the urgency created by the actual "trial" (there were about 6 witnesses and an interpreter in the Office prepared to testify that day), that facilitated that settlement. The Court's process (allowing a Statutory Offer to create the threat that the Defendants may have been able to recover their costs if the Arbitration favored their side) facilitated a serious negotiation which ultimately settled the case without the full evidentiary hearing.

My conclusion is that in both cases, the Court process had the paradoxical effect of urging the "independence" of settling these two cases outside the Courthouse. I thought it fitting, on this week of Independence Day, to draw these analogies. Independence is a prize to be cherished, but our partnership with the institutions and organizations that protect and demand accountability sure help to foster true independence!

Now back to last week's comments. Many of you were confused by the "apology"--so let me explain. After commenting upon the "debate" which was reported by the Daily Journal before the L.A. County Bar Association, I heard privately from Charles Parselle, who demanded a correction and apology. Since I had not correctly or completely reported the event, I simply offered the apology that Charles had asked me to insert. I agree that it should not be a debate, and I had no intention of entering into the debate, but rather commenting upon the sad fact that the matter had to be debated in that way.

I wish you all a Happy Independence Day--but one that is mindful that independence cannot be celebrated without interdependence in its shadows.