Stay up to date on everything mediation!

Subscribe to our free newsletter,
"This Week in Mediation"

Sign Up Now

Already subscribed No subscription today
Mediate.com

Negotiation Ethics

by Joe Markowitz
May 2014

Mediation's Place by Joe Markowitz

Joe Markowitz

The California State Bar Standing Committee on Professional Responsibility and Conduct has issued a proposed opinion attem pting to draw the line between unethical misrepresentations during negotiations, and permissible "puffing." Using this distinction, false statements about, as examples, the existence of favorable witnesses, or about the amount of a party's earnings, or about policy limits, would all fall on the unethical side of the line, and would subject an attorney making them to potential discipline. On the other hand, false statements about a party's "bottom line" of settlement authority, or about a party's willingness to litigate or its plans to file bankruptcy, would be considered mere "puffing," basically the kinds of lies that parties expect the other side to tell during negotiations, and that they should not rely on.

The distinction seems fairly easy to follow. Material misrepresentations of fact, that are intended to induce reliance, and that parties would reasonably rely upon, are impermissible. But a certain amount of bluffing about the parties' tactics and strategies is still considered fair play.

The proposed opinion could cause potential dilemmas for mediators, if they are asked to participate in impermissible sorts of misrepresentation. An ethical mediator should not commit fraud, and should take some action if the mediator becomes aware that one party is making impermissible misrepresentations. That could include refusing to convey misrepresentations to the other side, or even withdrawal in some cases. Strict confidentiality protections might, however, allow mediators and attorneys to avoid discipline for violating these proposed ethical guidelines when settlement negotiations take place during mediation.

Comments are open until May 19, 2014.

(Thanks to Rande Sotomayor for bringing this issue to my attention.)

Biography


Joseph C. Markowitz has over 30 years of experience as a business trial lawyer.  He has represented clients ranging from individuals and small businesses to Fortune 500 corporations.  He started practicing with a boutique litigation firm in New York City, then was a partner in a large international firm both in New York then in Los Angeles, then returned to practicing with a small firm and on his own.  In addition to general commercial litigation, Mr. Markowitz has expertise in  intellectual property, employment law, entertainment law, real estate, and bankruptcy litigation.  Mr. Markowitz has managed his own firm since 1994. Mr. Markowitz was trained as a mediator more than 15 years ago, and has conducted a substantial number of mediations as a member of the Mediation Panels in the Los Angeles County Superior Court, the District Court and Bankruptcy Court in  the Central District of California, as well as private mediations.  He has served since 2010 as a board member of the Southern California Mediation Association.   



Email Author
Website: www.mediate-la.com/

Additional articles by Joe Markowitz

Comments