Negotiating Bankruptcy (8/05/08)
Victoria Pynchon

My favorite local bankruptcy mediators

Ben Siegel of Buchalter (left)

former bankruptcy judge Herb Katz (right)

Bankruptcy mediation catches on nationwide

A decade ago, there were only a handful of mediation programs in bankruptcy courts.

Long associated with family law disputes, mediation programs were slow to catch on in complex business litigation, including bankruptcy cases.

But that's changing.

More than two-thirds of the 90 bankruptcy courts have mediation available, according to Robert Niemic, senior attorney at the Federal Judicial Center. Even more offer some other form of alternative dispute resolution, such as judicial settlement conferences.

In the U.S. Bankruptcy Court for the Central District of California, more than 3,800 cases have been referred to mediation since 1995. About 64 percent of those cases were resolved through settlements.

To keep costs down, the first day of mediation is free. Parties choose from a list of 200 attorneys and non-attorneys, such as accountants and financial experts, who volunteer as mediators.

Chief Bankruptcy Court Judge Barry Russell, who launched the mediation program in 1995, said that most cases settle in a day, producing major cost savings for both the court and the parties involved.

For full article, click here.

Connecticut Enacts Foreclosure Mediation Program in Mortgage Relief Bill (7/30/08)
Keith Seat

On June 18, Connecticut enacted wide-ranging mortgage relief and industry reform legislation, which included a foreclosure mediation program. The law requires lenders to tell delinquent borrowers about the mediation program when seeking foreclosure. If the borrower chooses mediation, lenders are required to participate, which could delay foreclosure by 60 days or longer.

Hartford Courant (June 20, 2008)

A Model Letter For A Model Mediation (7/30/08)
David Franzel
These "lessons learned" come from the experiences of highly seasoned litigators and in house counsel utilizing mediation services.

Final Rules of Civilian Board of Contract Appeals Cover ADR (7/16/08)
Keith Seat

The Civilian Board of Contract Appeals (which resulted from the 2007 consolidation of numerous contract appeals boards) published final rules to clarify procedures for alternative dispute resolution, among other things. The Board encourages ADR even on matters not before it, noting that mediation is most often used, but many other processes are available. The rules permit a panel judge to act as an ADR neutral and then (if ADR has not been fully successful) to resume work as a judge, if desired by the parties. The parties are to enter an ADR agreement specifying the neutral, the type of ADR desired, scope of related discovery and timing and location of ADR. However, use of ADR does not toll any statutes of limitation.

Wileyrein.com (May 14, 2008); Explanation of Final Rule (May 12, 2008); 48 C.F.R. 6101.54 (Subscription Required)

Debt Collector Grows Using Mediation (6/18/08)
Keith Seat

A debt recovery service in the U.K. attributes its rapid growth to focusing on mediation rather than litigation. In addition to obtaining payment, the service seeks to rebuild business relationships between its clients and their debtors, and brings a friendly approach to its work. However, the service emphasizes that it has a 100% win rate in the small number of cases it is forced to take to court.

ic Wales (U.K.) (May 30, 2008)

Corporations Encourage Mediator Diversity (6/06/08)
Keith Seat

Corporate counsel and representatives at an American Bar Association forum stated that mediation is losing its effectiveness because mediators do not have sufficient race and gender diversity, especially in employment matters. The panelists noted that the national alternative dispute resolution (ADR) providers do not offer diverse panels, and that diversity occurs when it positively impacts the bottom line. For example, Shell is introducing diversity among neutrals by contracting with certified minority and women neutrals, and by seeking more diversity at larger ADR firms.

Prudent Press Agency (Netherlands) (May 7, 2008)

Congress Negotiates the Foreclosure Crisis (5/26/08)
Victoria Pynchon

UPDATE:  IF YOU FOLLOW THIS LINK TO FORBES.COM COVERAGE OF THE FORECLOSURE CRISIS AND CLICK ON THE HIGHLIGHTED WORD "FORECLOSURE" YOU'LL FIND A WEALTH OF MATERIAL, INCLUDING VIDEOS, ON THE SUBJECT. 

See, for instance, this great post on "bailing out" homeowners at the Calculated Risk Blog here (found by clicking on the Lingo bubble on the Forbes.com site above.

In this morning's Los Angeles Times,  staff writer Maura Reynolds explains how -- and why -- the Senate has reached a deal on foreclosure legislation.  "Key senators" writes Ms. Reynolds,

announced Monday a bipartisan agreement on the broad elements of a plan to avoid foreclosures and speed the refinancing of mortgages for roughly 500,000 troubled homeowners without taxpayers footing the bill.

Political deal making showcases high-level bargaining skills at the intersection of interest- value- and rights-based negotiation paradigms.  No one files lawsuits against their Senators (well, no sane person).  But in the midst of an economic crisis, political representatives might just as well be defendants.  As Reynolds explains, the forclosure legislation "deal" reached in the U.S. Senate reflects the election-year pressure that lawmakers feel to find common ground on one of the most pressing issues facing the country.

The "Conflict"

Some theorists define conflict as a "crisis in human interaction" which the parties need help to overcome for the purpose of restoring constructive interaction.

Transformative mediation theorists and our little "d" democracy assumes that people have the capacity to solve their own conflicts over scarce resources, rights, interests and values.  (See MEDIATION STYLES AND TECHNIQUES prepared by the American Bar Association, Public Contract Law Section; Dispute Resolution Section; Center for Continuing Legal Education; and Interagency ADR Working Group; Contracts and Procurement Section at the Arnold & Porter Paul Porter Conference Center).

The Stakeholders

A stakeholder in a conflict is anyone who might be positively or negatively impacted by the crisis and its potential resolution.  In this case, the L.A. Times identifies the entire economy as a  "stakeholder." As Ms. Reynolds explains, the "housing collapse"

has inflicted pain on thousands of families, dealt the economy a major blow and ignited a fierce controversy over what -- if anything -- the government should do about it.

The stakeholders to whom elected representatives must answer are, of course, those who elect them -- voters and taxpayers -- as well as those corporate and individual contributors who fill their election coffers.  When selling a public good, however, it is best to acknowledge your allegiance to "the people."  As one Senator explained:

My primary consideration during negotiations on this package has been to protect the American taxpayer, and I believe we've made significant progress toward that goal.

National Resolution to Public Problems Must Reflect the Voters' Interests and Values

Unlike a lawsuit, where the parties are fighting over existing (or hoped for) rights and obligations, in economic, social or political crises the "fight" is not about "rights" but interests and values.  The right to declare bankruptcy aside, no one has a legal right to be "bailed out" of a financial crisis.  Nevertheless, a bail out may be necessary if elected officials are to serve the "interests" of their constituents according to those voters' "values."  

Values

As Reynolds explains, the lead Republican on the Senate Banking Committee, Sen. Richard C. Shelby, suggested that consensus among law makers could not be achieved if the proposed solution to the foreclosure crisis were seen as a "bail out" of "speculators" or of "borrowers and lenders who made bad decisions out of carelessness or greed." These are the "value" concerns that are part and parcel of any potential resolution of a community-wide conflict.      

Because we perceive money to be a scarce resource, we presume that its delivery to Interest Group A will deprive Interest Group B of funds necessary to serve Group B's needs or desires.  This is a  "zero sum" view of economics.  For individuals and many businesses, however, this is often not only perceived reality, but the actual fact of the matter.  

If mom and dad bail Billy out of jail for drunk driving, they may not have sufficient resources to pay his brother's room and board at Ivy League U.  Not wishing to "reward" bad behavior (a "value" metric) may be only part of the calculus, however.  If the family is capable of satisfying both brothers' interests, they may or may not decide to be guided by their "values."  They could act out of helpless parental love or simply compassion.  If the parents do not have sufficient resources to satisfy both brothers' needs at the same time, their decision about who to benefit will almost always reflect family values (little "F" little "V").     

How national problems should be solved within federal budgetary constraints is not so different from the family drama hypothesized above. 

Interests

The foreclosure crisis is not only about American values such as independence, thriftiness, caution, and hard work.  It is also about stakeholder interests.  As Reynolds reports:

Some Republicans have supported other versions of the legislation, citing the severity of the housing crisis and the escalating number of foreclosures in some regions of the country, including parts of California. They argued that the foreclosure crisis would damage entire communities and pull the economy toward recession. 

If larger societal interests -- like the economy itself /** -- are at risk, a "bail out" plan that "rewards" even the careless and greedy may be palatable to voters, particularly when, as Reynolds reports, "at the luxury end, home prices are falling."  In other words -- if this crisis is not addressed by our elected representatives (who are also stakeholders in this crisis) not only voters, but contributors to political campaigns might retaliate against them.   

Positively "Framing" the Proposed Legislative Solution to Meet Both Interests and Values    

In acknowledging the need for action, Senator Shelby positively "frames" the crisis as one affecting "struggling homeowners" who "should" be assisted so long as "American tax payers" don't have to foot the bill.  Others appeal to market and voter fears that the foreclosure crisis might "pull the economy toward recession" (if it has not already arrived there).  In all events, a majority of stakeholders in any democracy must feel satisfied that legislation addresses both their needs and their fears.   

The Proposed "Deal"

The proposed Senate "deal" to aid borrowers, lenders, and "the economy" is described by the  Times as follows:

The Senate plan announced by Shelby and Banking Committee Chairman Sen. Christopher J. Dodd (D-Conn.) is similar to the House-passed bill in that the centerpiece of each is an expansion of government mortgage insurance. Under both proposals, a borrower facing foreclosure could refinance into a government-guaranteed mortgage under certain conditions, including that the home is the owner's primary residence and that the holder of the existing mortgage accepts 85% of the home's current appraised value as payment in full.

The House bill calls for using about $1.7 billion from the federal budget to set up the program, which would be administered by the Federal Housing Administration.

Under the Senate deal, the start-up funds would come instead from an affordable-housing fund capitalized by mortgage giants Fannie Mae and Freddie Mac, which were created by the government but are owned by public stockholders.

This plan satisfies American "self-help" values by requiring borrowers to refinance.  It attempts to exclude "speculators" from the benefit created by requiring recipients of the government-guaranteed mortgages to affirm that the home is their primary residence.  And it "punishes" imprudent lenders by requiring them to accept 85% of the home's current appraised value as payment in full.  Finally, whereas the House would spend $1.7 billion in federal funds, the Senate hopes to tap the resources of Fannie Mae and Freddie-Mac, government created but privately owned lenders.   

Selling the Deal

Whatever deal is crafted to address a national financial crisis or to settle a piece of commercial litigation, it must be sold to all stakeholders.  Here's a classic "win-win" pitch based on interests and values.    

"This legislation is good news for both the markets and homeowners," [Senator] Dodd said. "The bill addresses the root of our current economic problems -- the foreclosure crisis -- by creating a voluntary initiative at no estimated cost to taxpayers, which will help Americans keep their homes."   Dodd told reporters the measure would speed the correction of housing prices to return stability to the market as soon as possible and prevent further damage to the broader economy.  "Obviously, we want to keep as many people as possible in their homes. But the second goal, as important as the first, is to get to the floor" of the housing correction, Dodd said in a conference call. "Until we get to the floor, none of this is going to get better."   "We have a lot of confidence that this is what the market is waiting for," Dodd said.

Deconstructing consensus-building in the political arena should help anyone who is making an effort to settle commercial litigation -- or simply a family dispute over the deployment of family resources.  

We thank Times staff writer Maura Reynolds for the depth and breadth of her reporting on this issue.   

For an analysis of the future of the Senate proposal, check out the Housing Chronicles Blog post Will President Bush Sign the Housing bill? here.  Housing Chronicles is a fellow Forbes Business and Financial Network blogger.

**/  For another look at what we mean when we use the term "economy" see this month's Harpers' article by Jonathan Rowe, Our Phony Economy. 

The Concept of Reciprocity in Mediation (5/19/08)
Jeff Kichaven
I received a startling e-mail from a prominent Southern California judge. The reality he reflects should cause the commercial mediation community to reject two clods of conventional wisdom. To satisfy clients, commercial mediators must learn to love—not disdain—"evaluation." Commercial mediators must also remember to love—and again, not disdain—lawyers.

Where were the mediators in the Microsoft-Yahoo negotiations? (5/19/08)
Diane J. Levin

Collaborative lawyer and ADR professional David Hoffman, in an op-ed in the Christian Science Monitor, asks, “Microsoft and Yahoo: Where were the mediators?“

David makes the strong case that mediation could have made all the difference, getting these digital technology giants to yes:

In the Microsoft-Yahoo negotiations, a mediator could have helped in several concrete ways.

First, since disagreements about the price of a company usually turn on financial predictions, mediators can help the parties structure creative options for mitigating their risks. Acquisition agreements often contain “earn-out” provisions that award benefits to the seller if the deal turns out to be a winner for the buyer. Without any investment in the outcome, mediators become “honest brokers” who can advance such ideas without the perception that they are seeking an advantage based on secret knowledge.

Second, a mediator can help the parties obtain neutral and independent opinions – as opposed to the potentially partisan opinions of the parties’ hired experts, lawyers, and investment bankers.

Third, a “mediator’s proposal” can test the waters of compromise. Let’s say the mediator asks each side to tell the mediator – on a confidential basis – whether they would accept a deal at $35 per share. This protocol means the mediator will report the answers only if both sides say “yes.” Thus, each side can take the risk of saying yes because the other side will never know unless they, too, have said yes.

Considering that mediation is “assisted negotiation“, it’s time for all of us who mediate to draw attention to the fact that mediation is not just for settling cases on their way to court or already in litigation — mediation makes sense whenever people want to negotiate better and smarter.

Microsoft and Yahoo: Where Were the Mediators? (5/12/08)
Colin Rule

David Hoffman in the 5/12 Christian Science Monitor: "When Microsoft CEO Steve Ballmer met with Yahoo CEO Jerry Yang earlier this month, what kept them from making a deal? With Microsoft offering $33 per share for Yahoo's stock, and Yahoo willing to take $37, was there truly an unbridgeable gulf? The $4 gap seems trivial in comparison to the potential value of the deal. So did Microsoft and Yahoo walk away from a deal that would have made both sides better off? This type of bargaining failure is hardly rare – businesspeople frequently report deals that have come within inches of closing, only to slip away at the last moment, costing their companies plenty.
 
In the world of litigation, settlement gaps are routinely bridged with the help of mediators. In the world of foreign policy, mediation – sometimes called "shuttle diplomacy" – is used extensively to resolve conflict. Why, then, are business transactions rarely mediated?
 
One theory is that the functions that mediators perform are already handled by transactional lawyers and investment bankers who work hard – and are handsomely rewarded – to close deals. The problem with this theory is that the lawyers and investment bankers often approach the negotiation from a partisan perspective in order to prove their loyalty to their respective clients.
 
A more promising explanation is that when conflicts arise – as in a potential hostile takeover situation such as the Microsoft-Yahoo negotiations – the parties reject compromise because they see the world through a distorted lens. Conflict can cause "reactive devaluation" (a negative assessment of a proposal because it comes from an opponent). Neuroscientists tell us that conflict triggers some of our most primitive reactions – a fight-or-flight response – as opposed to the collaborative impulse required for dealmaking.
 
It's not surprising, then, that people – especially in business settings, where egos, competition, and high stakes collide – are unlikely to opt for mediation unless they are forced, or strongly urged, to do so. In the world of diplomacy, it is often the superpowers that intervene when smaller nations quarrel, and court cases are often mediated because a judge insists on it. Indeed, Microsoft mediated its antitrust dispute with the Justice Department only when the court ordered it. In the setting of mergers and acquisitions, however, the key difference is that there is no outside power that can insist on mediation. Accordingly, it is often up to boards of directors or shareholders to push management to mediation..."
 
The ways that people negotiate are very tied to their cultures, and unfortunately in our culture the use of a third party to assist in a negotiation is frequently cast as a sign of weakness. The notion that Steve Ballmer would have assented to the involvement of a mediator in the negotiation is quite a stretch. But David makes some very strong arguments in this piece.
 
I'd love to see the conflict resolution field put more energy into promoting dealmaking mediation. I think in some contexts it could prove invaluable, and word could get around.

Mediation Requirement Streamlined for Florida Homeowners Associations (3/18/08)
Keith Seat

Statutory changes in Florida have streamlined the mediation process required prior to litigation of certain disputes between homeowners and members. The aggrieved party now can contact the other party directly with a written offer to mediate as set forth in the statute and propose a choice of five certified mediators. Seeking mediation in this way tolls the statute of limitations. If the dispute goes on to litigation or arbitration, attorneys’ fees incurred in the mediation may be recovered by the prevailing party. But those who do not participate in the entire mediation process may not recover any attorneys’ fees or costs.

The News-Press (February 28, 2008); Fla. Stat. § 720.311

IP Mediator Michael Young's "Girls Gone Wild" Commentary Catches Court's Attention (3/17/08)
Victoria Pynchon
From ALTERNATIVES TO THE HIGH COST OF LITIGATION, INTERNATIONAL INSTITUTE FOR CONFLICT PREVENTION & RESOLUTION VOL. 26 NO. 3 MARCH 2008

UPDATE: DESPITE MEDIATION RELATED INCARCERATION, GIRLS GONE WILD FOUNDER IS HEADED FOR MORE ADR

A federal judge has rejected a recusal motion from the maker of the Girls Gone Wild videos, who challenged the judge’s impartiality for first ordering mediation, and then sending the producer to jail for contempt based on his ADR conduct. That means the civil case against still incarcerated Joseph Francis will proceed. And, surprisingly, the case will go back to mediation.

In an order accompanying the . . . . opinion . . . U.S. District Court Judge Richard Smoak . . . told the parties to try mediation again. Smoak ordered . . . . mediation by June 27, with a “mediation report” deadline six days later.

In his 22-page opinion, Smoak strongly defends his record as a mediation supporter, and rejects claims that he tried to force Francis to settle before sending Francis to jail for contempt.  The defense charges stem from a suit brought by Francis’ video subjects.  . . . .  

The support for the defense motion included Los Angeles attorney Michael Young’s 2007 Alternatives article, “Mediation Gone Wild: How Three Minutes Put an ADR Party Behind Bars,” 25 Alternatives 97 (June 2007) (available at WileyInterscience. com). Young wrote that Smoak’s moves intruded into the mediation process and hurt ADR.

Court's opinion below:

 

Court Opinion re Girls Gone Wild Producer Joe Francis - Get more free documents

Capitalizing On Mediation: The Power Of Promoting Awareness For Business Efficiency (2/11/08)
Alessandra Sgubini
In today’s business market, successful and efficient businesses recognize the numerous benefits of mediation and possess the willingness to engage in cooperative negotiations with the help of an impartial third party. This article addresses the importance of promoting the awareness of mediation as an effective conflict resolution tool for businesses in all fields based on proven evidence that it saves immeasurable time and capital especially for businesses across the board.

Courageous Carriers, Meaningful Mediations (2/11/08)
Jeff Kichaven
Pity the poor plaintiff at the mediation of a third-party claim being defended under a reservation of rights. This lonely soul has been "mediated-upon" and finally lowered her settlement demand to a reasonable number. Still, no deal. The mediator spends hours with the policyholder-defendant and its insurer, but to no avail. The mediation ends, and the plaintiff is frustrated. Why was she forced to waste a day? Embittered, she and her counsel return to the litigation trenches less willing to collaborate on settlement initiatives, discovery, scheduling, or anything else. Clearly, this is a bad result.

Businesses Encouraged to Use Dispute Resolution Clauses (2/06/08)
Keith Seat

Companies are encouraged to include mediation or arbitration clauses in agreements covering their business dealings, including employment contracts, in order to avoid litigation. The widespread use of alternative dispute resolution clauses in most consumer contracts for health plans, car leases and insurance demonstrates that all businesses need to make sure their forms are updated with appropriate protections.

Business Times (January 11, 2008)

Hotel Association Urges Mediation Rather than Arbitration in Franchise Agreements (2/06/08)
Keith Seat

In its updated standards for fair franchising, the Asian American Hotel Owners Association includes dispute resolution provisions which focus on mediation if informal direct negotiations are unsuccessful. The standards avoid binding arbitration unless mediation has not been successful and there is express agreement on the details of the arbitration process, including the identity of the arbitrator and location of the arbitration.

Hotelinteractive.com (January 14, 2008)

Survey Concludes that Mediation Saves U.K. Businesses a Billion Pounds a Year (1/23/08)
Keith Seat

A survey by the Centre for Effective Dispute Resolution (CEDR) calculates that mediation in the U.K. saves businesses over £1 billion in legal fees, damaged relationships and lost productivity, at a cost of only £8 million in mediation fees. The survey concluded that there were about 3,700 mediations in the last year, which is up a full one-third since CEDR’s 2005 survey. Over half of these mediations were conducted by only 35 individual mediators, with top mediators charging over £3,000 per case and earning over £280,000 a year. The survey also covered the experience and backgrounds of mediators, performance in mediation, ethical issues and perspectives on standards and regulation.

Sourcewire (November 12, 2007); CEDR Survey (November 8, 2007)

Colm Brannigan and Michael Erdle on Mediating Canadian I.T. Disputes (1/14/08)
Victoria Pynchon

Ontario-based mediator Colm Brannigan * has passed along a valuable article on the mediation of Information Technology disputes from a June '07 Ontario Bar Journal publication.  The article, Resolving I.T. Disputes through ADR -- Part I Mediation was written by Colm with his co-author Michael Erdle. **

Link above with a tempting excerpt below:

[A] common obstacle to settlement in technology cases is differing interpretations of technical terms in a contract or specification. This may prevent the parties from addressing more substantial issues. One possible solution is to mediate a common standard against which the more substantial issue will be measured. A mediator can work with the parties to bring about agreement on a common technical expert whose opinion will be acceptable to everyone.

Another common cause of IT disputes is a misunderstanding between the parties of their respective obligations on a large project. This is especially true where there are multiple parties. The work inevitably takes longer and costs more and each of the parties, often all in good faith, blames the others for the problem. This is a situation that is very difficult to resolve through a series of one-on-one negotiations and can almost always benefit from mediation.

The mediator can facilitate a session that brings all of the parties together, to explain their own understanding of their roles and responsibilities. This assists all parties to understand the gaps that have arisen and helps them to find ways to bridge those gaps in ways that can benefit everyone. These kinds of results are simply impossible to achieve through arbitration or litigation.

In many situations, the parties will have devoted resources to developing a technology or an application upon which they become mutually dependent. Often, other parties, who are not directly involved in the conflict, also rely on these technologies. In a traditional litigation approach, an injunction is often viewed as the remedy of choice.

But the extremely disruptive results of this action on business partners and third parties must be taken into consideration. While the legal rights may support an injunction, the consequences will likely disrupt the business relationships to such a degree that no subsequent effort to restore them would be successful.

Most business people agree that a major part of a company’s cost in delivering services is the expense incurred to develop and maintain customer relationships. The investment in this area is put at risk by traditional litigation methods. By using mediation the parties can meet and with the assistance of the mediator develop creative ways to preserve their investment and/or rights while they work to resolve the substantive issues in their dispute. This can avoid disruptions to a third party that could have the unintended result of additional legal proceedings by the third parties against the disputants.

No dispute is completely binary (win-lose) and business people usually do not think in such simplistic terms. Why should their advisors? Mediation tries to achieve a positive sum result – “I win, you win”. While not always possible, mediated results tend to be creative and sustainable, simply because they are mutually-beneficial. In an industry where entrepreneurship, speedy decision-making and action are highly valued, the management “distraction factor” is an even greater litigation cost than in traditional industries. This cost is significantly reduced by the use of mediation as an affirmative business strategy.

For the full article, click here.

_________________

* Colm Brannigan, LL.B., LL.M. (ADR), C. Med. is a full-time mediator and arbitrator. He can be contacted by e-mail at colm@mediate.ca or (905) 840-9882.

** Michael Erdle is Managing Partner of Deeth Williams Wall LLP. He is a mediator and arbitrator and has advised technology clients in alternative dispute resolution. He can be reached at merdle@dww.com or (416) 941-9201.

Mediation Successful in Providing Consumer Restitution (1/09/08)
Keith Seat

Missouri’s attorney general recovered $9.2 million for consumers through mediation in 2007, which greatly exceeded the previous record amount of $5.2 million in 2006. The attorney general’s office handled about 100,000 contacts from consumers during 2007, including 36,000 formal complaints.

US State News (December 31, 2007) (Subscription Required)

Mediated Settlement Increases Company’s Market Value 70% (1/09/08)
Keith Seat

A $130 million jury verdict in December motivated American Dental Partners Inc. to settle the breach of contract litigation through mediation, resulting in a 72% surge in the price of the company’s stock after the settlement was announced. American Dental provides business services to dental practices, including PDG, P.A. which alleged that, among other things, American Dental refused to give dentists access to their own funds, paid itself unreasonable service fees, and withheld funds for new equipment. The settlement agreement includes American Dental transferring leases and assets for 25 of 31 facilities, payment by PDG of $19 million in future management fees, forgiveness by American Dental of a few million in accounts receivable due from PDG, among other details. The settlement is subject to the approval of secured lenders and requires the parties to enter into definitive agreements by a specified date.

CNNMoney.com (December 27, 2007); Boston Globe (December 27, 2007)

Second in a Series about the Real Estate Downturn and Mediation (12/31/07)
David W. Dresnick
Since the last article in this series was published in the December 2007 edition there has been more bad press not only about the deepening housing market problem, but also for commercial real estate.

Australian Agency Uses Mediation to Assist Small Businesses (12/20/07)
Keith Seat

The Victorian Small Business Commission uses its broad investigative powers and mediation to end unfair market practices and bullying of small businesses by larger companies. The Australian agency has increasingly focused on franchising relationships, along with retail tenancy disputes and other contract issues. The Commission encourages mediation as a way to resolve conflicts without necessarily ruining relationships. The Commission has dealt with 4,000 complaints since the office opened in 2003 and resolved about 80% before or at mediation. The Commission also encourages companies to avoid conflict by utilizing specified practices to sustain good working relationships.

My Small Business (December 17, 2007)

Iowa, Ohio Turn to Mediation in Home Loan Crisis (12/12/07)
Keith Seat

Seeking pragmatic solutions to address subprime mortgage foreclosures, Iowa Attorney General Tom Miller hired the Iowa Mediation Service in September to establish a toll-free phone line and work with Iowa homeowners. The mediation service has received 4,100 calls and is working to settle over 500 mortgage cases. This is a familiar path for Attorney General Miller, who helped enact a state law in the 1980s requiring lenders to mediate troubled farm loans prior to foreclosure. The Iowa Mediation Service began in 1985 and resolved 21,000 cases during the farm crisis. In Ohio, the state Supreme Court is planning to implement pilot projects in three counties using mediation to resolve foreclosure disputes, while a lower court in a fourth county is pulling together bankers, attorneys, government officials, real estate agents and others to develop a mediation program to reduce foreclosures.

New York Times (December 9, 2007) (Subscription Required); Mansfield News Journal (Ohio) (December 4, 2007)

Take This Idea: Commerical Mediators Wheel & Deal with Entrepreneurs (12/11/07)
Dina Beach Lynch
Finding the right niche is critical to your success as a mediator. While most folks can identify a broad niche, say family or workplace, it's those who dig a bit deeper that find the gold.

Reading NY Report while in bed this morning I saw a great article on Buy/Sell Agreements. Entrepreneurship is fraught with conflicts, and one of the stickiest is when owners want or need to sell. Great, I thought- this article will make excellent content for Mediation Mensch.

Imagine my surprise and delight when I noticed that the author's name- Richard Lutringer- a member of ADRPracticebuilder.com! Richard Lutringer is counsel at the New York City office of Chicago-based Schiff Hardin LLP, a full-service law firm. His primary areas of concentration are corporate transactions and mediation.

Here's what Richard has to say about this opportunity:

Alternative Ways to Resolve a Buy-Sell Dispute

Litigation and, recently, arbitration, the traditional means of dispute settlement, are expensive, time-consuming and unpredictable. More and more businesses and their attorneys are choosing to use a third-party mediator to assist them in resolving contentious issues in one or two days, leaving good relationships and bank accounts intact. Mediators, usually paid on an hourly or daily basis, are trained in negotiation and dispute-settlement skills and have no stake in the outcome. Lists of experienced commercial mediators are available through many state and federal courts as well as such organizations as JAMS (jamsadr.com) and the American Arbitration Association (www.adr.org).

What does this mean to you?

For all those workplace and commercial mediators who are chasing corporate clients, this means you may want to look at the small business market instead. Serving newly formed and established partnerships can be a very lucrative business for mediators.

The variety of disputes that can arise within a partnership are almost unlimited. A mediator could specialize in partnership formation or charters, and assist the entrepreneurs to define and standardize their relationship, responsibilities and decision-making abilities. Once, I worked with partners in a three person law firm who had formed on a handshake and then got stymied when one partner decided not to practice law any longer. If they'd taken the time at the beginning, the end of their partnership would've been much smoother and less costly.

You could specialize in buy/sell agreements as Richard suggests. Valuation is a very emotional issue. It would be important to have a third party to help process hard feelings and make a space for good judgment to prevail.

How do you find clients?

The old fashioned way: research. Happily there are some new technology tools to make this process easier. Turn to Hoovers.com or OneSource.com to get a big picture of what companies meet your target market criteria, then use business social networking sites like LinkedIn to make connections.

Then do a Google alert for your small group to understand what the company is doing or needs now. It won't guarantee that you'll get the business but you'll be much better position with a warm introduction and a sense of the company's current needs.

Many thanks to Richard Lutringer for leading the way...

Try. Fail. Learn . Grow! Dina

PS The Workplace Learning Circle, which will discuss these types of opportunities, launches on Monday, Dec. 10th. Visit my website for more details.

The Real Estate Downturn Spawns an Increasing Need for Mediators and Arbitrators (12/03/07)
David W. Dresnick
The growing poor economic cycle for real estate, and growing consensus projections that the reduction in housing prices may last to the beginning of 2009, has resulted in a ever expediential increase for the need for Mediators and Arbitrators.