Can Mediation Evolve Into A Global Profession? (3/30/09)
Geoff Sharp

An important article hot off the press from Michael McIlwrath, Senior Counsel-Litigation, GE Oil & Gas, Florence, Italy and Chairman of the Board of the International Mediation Institute.

In many legal environments, mediation has found itself in a bit of a rut, experiencing only very marginal growth. Where mediators are plentiful, they tend to be in chronic over-supply. In the view of many consumers of dispute services, this is not a problem of mediation but of the way it is presented within these particular markets.

Take the UK for example. Having developed initial techniques and training from the US, there are now thousands of trained mediators. However, it is claimed that only about 20 people practice as full time mediators, with perhaps 50 conducting 80% of the country’s mediations. Thousands of others struggle to gain experience and practical skills...

At one and the same time, mediation is being presented with an opportunity to leave its status quo as a local niche activity and become a truly global profession. But the question is – are the mediators and service providers in this field sufficiently responsive to the current environment to make it happen?

To put it bluntly, mediation needs to emerge globally as a profession that is widely understood and accepted, and where competent, trained mediators are instinctively regarded as professionals regardless of their background. Where parties see mediation as an opportunity to come to a conclusion and are much more inclined to accept, rather than reject, a proposal to engage a mediator. Where there are enough competent mediators from all cultures and technical fields that the most suitable can easily be identified... [read more]

From the blog mediator blah...blah...

Pursuing A Divide And Conquer Negotiation Strategy? Don't Miss New California Case Law On Good Faith Settlement Findings (3/30/09)
Victoria Pynchon

Challenges to good faith settlements that cut off the rights of non-settling defendants to seek indemnification and contribution from settling defendants are nearly always doomed to failure.  Trial courts are understandably eager to clear their dockets and there's no docket-clean-up pitcher like the first defendant to settle.  Deny the motion and bring a settled defendant and his trial-ready resources back in to the litigation when the first defendant-domino has just successfully toppled over?   Not likely, my friend. Not in the trial court at any rate.

These motions are so difficult to oppose that I've seen a target defendant threaten a marginal player (my client) with sanctions just for challenging the target's very low six-figure settlement in an eight-figure antitrust action.

It looks like low value settlements got just a little bit harder to defend yesterday when the Second District Court of Appeal reversed a trial court's good faith settlement finding in  Long Beach Memorial Medical Center v. Superior Court (Conners).

Best quotation:  "The hospital contends that the physicians‟ $200,000 settlement -- representing 2 percent of plaintiffs‟ $10 million damages estimate -- was so far out of the “ballpark” it was not even in the parking lot."  With a first runner-up to "If section 877.6 is to serve the ends of justice, it must prevent a party from purchasing protection from its indemnification obligation at bargain-basement prices."

The Court of Appeal relied upon the following "facts" in finding that the trial court abused its considerable discretion in granting a good faith motion to defendant physicians in light of defendant hospital's opposition.

• payment of $200,000 in settlement for a $10 million claim, which the appellate court found to be "wholly disproportionate."  As the Court opined "[e]ven a slight probability of liability on [the settling doctor's] part would warrant a contribution more significant than 2 percent."
•  the "evidence" supporting the court's finding that the settling physician's probable fault was "not de minimis,"  which appears to have been based upon Plaintiff's attorney's fault analysis (not generally known for its unbiased nature) and the physicians' counsel's candid (?) suggestion that his clients' contribution to a global settlement might be in the range of $1.5 million;
• the availability of $2 million in coverage, which "militated against a good faith determination" because the settlement constituted only 10% of available policy limits [carrier alert here!];
• the non-settling Hospital's contention that the physicians and their attorneys engaged in "bad faith tactics" during two mediation sessions -- a factor the appellate court acknowledged it was barred by mediation confidentiality from considering -- but which it neatly avoided by concentrating on post-mediation negotiations; /*
• the timing of the physicians' settlement offer, which suggested to the appellate court that their "reason for entering into the settlement with plaintiffs was to cut off the hospital's . . .  right to indemnity from the physicians" (I thought that was a legitimate reason to settle litigation but see the Court's citation to Mattco Forge, stating that when a defendant  “enters into a disproportionately low settlement with the plaintiff solely to obtain immunity from the cross-complaint, the inference that the settlement was not made in good faith is difficult to avoid.” Mattco, supra (emphasis added); and,
• a consideration I've never seen defeat a good faith motion before - that a settlment "dictated by the tactical advantage of removing a deep-pocket defendant . . . is not made in 'good faith' consideration of the relevant liability of all parties. . . ." (leading to the question whether we're now required to consider the interests of clients other than our own in entering into a settlement agreement on a contested claim)

If this case isn't depublished (an unfortunate California practice) or taken up for review, it will bear re-reading and deeper thinking about the stategy and tactics of breaking away from the mob to cut a separate deal beneficial to one's own client without "consider[ing] . . the relevant liability of all parties . . . "

Comments welcome!!

 

________________

*/  This is a good place to note the importance of either indicating in the parties' post-mediation written negotiations that the mediation is continuing (hence the communications remain absolutely protected) or that the mediation has concluded (hence bringing those post-mediation settlement negotiations outside the scope of the strictly enforced mediation confidentiality restrictions).

From Settle It Now Negotiation Blog

Competition ? Cooperation (3/30/09)
Phyllis Pollack
When I started mediating cases, I never thought that I would have to be aware of or learn advanced mathematics. But a book that I recently finished has shown me otherwise. Entitled, Rock, Paper, Scissors: Game Theory in Everyday Life, its author, Len Fisher, PhD. (Basic Books (2008)) explains how game theory applies to everyday life. In turn, game theory is predicated on the Nash equilibrium, named after John Nash who won a Nobel Prize in 1949 for discovering that all social dilemmas arise from the same basic logical trap (Id. at 7.) Using his mathematical genius, Nash “. . . was the first to identify the logical trap (now known as the “Nash equilibrium”) and then to prove a startling proposition – that there is at least one Nash equilibrium lying in wait to trap us in every situation of competition or conflict in which the parties are unwilling or unable to communicate.” (Id. at 18.) (Emphasis original.)

What is the “Nash equilibrium”?:

“It is a position in which both sides have selected a strategy and neither side can then independently change its strategy without ending up in a less desirable position. . . .”

“Nash called such a state of affairs an equilibrium because it is a point of balance in a social situation, from which neither side can independently escape without loss. . . . So long as we act independently, with each of us pursuing our own interests, the Nash equilibrium will continue to trap us in a plethora of social dilemmas.” (Id. at 18.)

A perfect example given by the author is an acrimonious divorce:

“It would usually pay [sic] [for] both parties to compromise, but so long as one refuses to compromise, it is not worth the other party’s while to give way. They become trapped in a Nash equilibrium so that both lose out through the money they have to pay to lawyers and the emotional stress they end up going through.”

“. . . the parties are trapped in a genuinely paradoxical circle of logic that arises because they are unwilling or unable to communicate and to coordinate their strategies. But there is an escape clause: if the parties can communicate and negotiate, they may be able to break out of the dreadful trap.” (Id. at 23.)

The decisive feature is that the cooperative solution or negotiated agreement must prove more beneficial to each of them than pursuing their respective strategies independently of the other. (Id.) Otherwise, each party will “willingly” remained “trapped.”

In essence, each of us will approach a social situation with a “what is in it for me” attitude and thus pursue our own individual interests over those of the others or even of the collective whole, in the hopes of gaining the best possible deal. But this gain will come solely and only at the expense of every other person involved in the social situation. Only when we realize that if we continue to pursue our separate interests independently of everyone else, the result will be worse for all concerned, do we change our strategy from one of competition to one of cooperation. At this point, we are at the Nash equilibrium and realize that in order to get out of the “trap,” we must stop being competitive and begin to communicate and be  cooperative with each other. By doing so, we can turn a lose-lose situation into a win-win situation, so that everyone walks out a winner.

According to Nash, this theory applies to any social situation in which two or more persons are involved. Take a moment and reflect on a recent social dilemma, replay it in your mind, but this time apply Nash’s theory. . . . See what I mean. . . Life becomes game theory based on advanced mathematics.

Perhaps, mediation is meant to be the apex of the Nash equilibrium. The parties walk in with a “what’s in it for me” attitude and the goal of the mediator is to change the parties’ mindset from competitive to cooperative; to have each party understand that if she continues with her own strategy independently of everyone else involved, the situation will only become worse for all concerned, not better. . . but that the way to change this is to start communicating and cooperating and choose strategies by which each party can win; to go from competitiveness to cooperation; from lose-lose to win-win.

Is mediation the tipping point in game theory? Perhaps so.

. . .Just something to think about.

From the Blog of Phyllis G. Pollack.

Mediation Program So Successful, It'd Going Be Canceled! (3/30/09)
Jeff Thompson