Attorneys often say that pre-litigation or early-litigation mediation just doesn’t work for them or their clients. The client may be too angry at the outset to consider the concept of compromise. The lawyer may need to impress a potential client with his “pit bull” aggressiveness as a litigator. The client may insist on having his “day in court.” And, what about discovery? Shouldn’t a responsible lawyer conduct discovery before settling his client’s case? Why should the lawyer give a preview of his case to the other side?
As one of my colleagues likes to say, “you either pay now or you pay later.” And that applies to both sides. All litigators know that well in excess of 90% of civil cases settle before trial. The real question is when will the case settle – before filing the action and plunking down a retainer, the filing fee, the service costs, and facing the inevitable deadlines and burdens of discovery? Or, after years of anxiety-driven phone calls to the lawyer, ever-expanding expectations of success, followed by the flurry of last-minute discovery, annoying or stress-inducing depositions, expensive motion practice, even more expensive trial preparation, trial court delays, and finally, the HUGE BILL from the lawyer? Then, of course, there is the ubiquitous fear of appearing weak to the other side by even mentioning the concept of pre-litigation or early mediation of disputes.
Wow. How can you achieve the best result for your client . . . and for you? I have never met a client who doesn’t want his problem solved as quickly and cheaply or for the maximum recovery as possible. Emphasis on “quick.”
What to do? The best way to achieve an early settlement is to investigate and work up your case as completely and as early as possible. The smart plaintiffs’ lawyer will gather and provide everything the defendant needs to evaluate, and put a monetary value on, the case. That means a straightforward “package” of the information and documents that you know the defendant will need.
The reality is that most defendants will work up a case with more than one decision-maker, then have a roundtable evaluation, and then attach a value to the claim. If a plaintiffs’ lawyer withholds key information, the kind that could really increase the value of the claim substantially from the defendant’s point of view, the plaintiff could well be at a disadvantage at mediation. The defendant’s hierarchy of decision-makers would not have had the benefit of that information in determining the value of the case.
In federal court, much of this can be accomplished through the Rule 26 initial disclosures if the lawsuit has already been filed. But both sides of the dispute can exchange packages akin to initial disclosures even before a case is filed. It is nevertheless critical to do a thorough investigation of the facts to ensure that an early settlement is based on complete information.
Will you appear weak if you suggest early mediation? The most sophisticated plaintiffs’ lawyers I know tend to reach out before filing an action to begin the negotiation process. Savvy defendants and their lawyers appreciate the reality that a lawsuit is sure to follow. In federal court, you’ll be contacted pretty quickly to select an ADR procedure, and you’ll have to follow the mediation program anyway. In state court, since the closure of the ADR program, you’re left on your own to broach the subject of settlement, most likely later rather than sooner.
The reality is that most lawyers want the pressure of a court “order” or referral to mediation so they don’t appear to lack confidence in their case. Consider your approach to your experienced opponent. Don’t you both know that eventually the case will have a 90+ percent chance of settling? The opportunity to bring in a trusted mediator to initiate negotiation could be part of your pre-trial schedule and checklist. It really is an objective procedure, arguably akin, at least in the life of a case, to a case management conference or scheduling conference. Parties need to understand that other than a dispositive motion, mediation is their only, and best, chance to resolve the case before trial.
How do you deal with a client who insists on having his day in court? Mediation is the perfect vehicle for letting both sides air their dispute in a setting where they can control the outcome of the dispute, and not a third party who just may not see it their way. Some parties benefit from the opportunity to communicate their position to the opposition face to face. Others benefit from just the opposite. Unlike a court trial, a mediation is custom-made.
Sometimes, a mediator can be called in before litigation is commenced to assist the lawyer in conveying the costly and risky realities of litigation. This approach helps both client and lawyer and relieves the lawyer of conveying any kind of weakness that is contrary to what the client is looking for at the moment.
In fact, calling in a neutral third party before a dispute escalates too far can save relationships, partnerships, businesses, and money. A mediator can help in many kinds of disputes that don’t even contemplate litigation. Where communication fails, with relationships at risk, the value of facilitating communication and brainstorming solutions is enormous.
Consider the usefulness of engaging a mediator before you or your client give up on a business, throw in the towel on a deal, letting the “pit bull” loose on the opposition, or investing too heavily in a case that will cost more than it’s worth. This could be your most valuable strategy ever.