Multi-Party Negotiations

Gaining Analytic Command of Complex Negotiations I. Outline the underlying interests of the key parties. a. Draw a diagram showing the key parties to the negotiation. b. Hypothesize about -- and list – their most important underlying interests. c. Prioritize their interests and in a rough way, try to weigh their interests. II. Do any of the other parties have common interests with your client? Can you use these interests in designing possible solutions benefiting your client?

Gaining Analytic Command of Complex Negotiations III.Do you see differences between the parties that you can use to create trade-offs benefiting your clients. IV.Succinctly summarize the leverage, strength, BATNAs and weaknesses of the key parties. V.Spend a few moments looking at the most important interests of the key parties, and in a very uncritical way brainstorm possible solutions. VI.Can you see the direction of possible solutions? VII.Which ones benefit your client the most?

Dorothy Chandler Ranch: The Primary Interests of the Key Parties Plaintiffs Environmental GroupsGovernmentsHomeowners Sequoia ClubYIKES 1. Parkland 2. Native Grasses 3. Malibu Creek 4. Bat Caves 5. Downsize 1. No Development 2. Delay Development 3. Downsize LA CNTY, LA City, Malibu, Calabasas 1. Traffic Mitigation $ 2. Air Impacts/$ 3. Reduce Size Individual Interests: 1. Big, Little 1. Dump 2. Traffic 3. Downsize 4. Particulates Defendants ChandlerVentura County 1. $$$$1. Prudent Development 2. Reputation2. Maintain some open space

Five Tools for Gaining Analytic Command of Complex Negotiations Tool # 1Simplify the dispute– Diagram the key parties and their key interest on one piece of paper. Tool #2Focus on underlying interests not positions, and prioritize those interests. Tool #3Any place you can find mutual interests, use them. Tool #4Take advantage of differences in the parties tastes, preferences, priorities and expectations to design solutions and trades. Tool #5Assess the leveage, BATNAs and vulnerabilities of the parties.

Try to Build a Consensus  What Do We Mean By Consensus Building?  A process for seeking unanimous agreement, involving a good faith effort to meet the interests of all stakeholders.

Consensus Building Essential Steps STEP 1: Starting the Process  Initiate discussion about how to begin a consensus building dialogue and process.  Identify appropriate stakeholder representatives.  Begin to asses the conflicts.

Consensus Building: Essential Steps STEP 2: CLARIFYING RESPONSIBILITY  Specify role of facilitators, mediators and recorders.  Set rules regarding the participation of observers.  Set agenda and ground rules.  Determine extent to which case will serve as precedent for the future.

Consensus Building: Essential Steps STEP 3: DELIBERATING  Strive for positive communication.  Separate inventing from committing (in other words, one should be able to brain storm and suggest options without the group thinking that they are committing to that option).  Create subcommittees and seek expert advice.  Use a single text procedure (avoid attribution– this is Mr. Smiths Deal).

Consensus Building: Essential Steps STEP 4: DECIDING  Try to maximize joint gains.  Use contingencies.  Follow agreed-upon decision rule (seek unanimity; fashion package that all can live with).  Keep a record.

Consensus Building: Essential Steps STEP 5: IMPLEMENTING AGREEMENTS  Seek ratification by constituencies.  Provide for monitoring of agreement.  Provide for adaptation to changed circumstances.

How Do We Know Consensus Has Been Reached?  When (almost?) everyone agrees they can live with the suggested proposal after every effort has been made to meet the interests of all stakeholding parties.  Most dispute resolution professionals believe that groups should seek unanimity, but we often settle for an agreement that goes as far as possible toward meeting the interests of the stakeholders.

What Are the Rights and Responsibilities of Participants in Consensus Building Process?  Participants have a difficult time when they are asked to sacrifice their interests for the sake of agreement. Be careful of this. Remember your BATNA.  Everyone should try to propose solutions that will meet everyone else’s interests as well as their own.  The definition of success must be clear at the onset!

Difficult Negotiations

Difficulties in Negotiations  There are a lot of reasons why cases do not settle or a deal is not completed.  The reasons they do not settle is often not because of the facts and the law; or because of contract terms.  Your job is to analyze the negotiation circumstances and give your client the option to settle or enter a deal if they want.

Role of Perception  Subjective. Always check your views, opinions and analysis of your position!!  One’s view of fairness. (Barry Bond’s homerun).  Be very careful of your client's (and your own) perception of fairness.

Psychology Traps; Barriers to Resolution  These are some of the most difficult issues to deal with for the client and the negotiator.  Selective Perception (you see what you want).  Optimistic Overconfidence (we over value our cases, we will win more than we do).  Loss Aversion (I already have 25 grand in legal fees… Lets just roll the dice).

Litigation Escalation  Discovery makes us overconfident.  We want to get more certainty. My client wants all the depositions before she can decide (I ask why?) We spend too much money on discovery (a bit self serving). It increases “loss aversion”.  Try to settle early.

Emotions  Emotions drive negotiations: you cannot avoid them…deal with them.  Become aware of your emotions, your clients and the other sides (lawyer and client).  Do not let a negative relationship with the other negotiator get in the way of your clients chances of settlement.  My experience: Always be professional, be courteous, do not become vindictive and it is better to build relationships rather than break them.

Watch out for many of the problems.  Overly competitive  Complexity of issues  Setting an example  Different perceptions  Different case evaluations  Fixation on a single position  Hidden agendas  Large number of parties  Past history (baggage)  Poor communication  Reputations  Stereotypes  Strategic irrationality (fear of looking weak)

More issues and problems  Timing  Failure to listen to the other side  Insult, humiliate, threat, commands  Backwards step  Failure to understand your BATNA and theirs  Matter of Principle  Overconfidence  Over investment in case and not turning back (loss aversion)  Principal Agent issue: Incentives for lawyers not to settle  Critical facts in dispute

Overcoming Barriers  Try to see these barriers and over come them.  Sometimes a mediator will help, use a new person to negotiate, new ideas, new thinking etc.

Attorney Roles  Advocate  Problem Solver  Deal Maker  Counselor  Dispute Resolver  Innovator  Leader  Settlement Counselor  Champion  Hired Gun  Litigator  Healer  Pillar of the Community  Statesperson (Statesmen)