SELECTED MEDIATION ISSUES

u Each Mediation is Different n Evaluation of Case l Counsel n Personalities n Experience n Knowledge of controlling facts/law

u Each Mediation is Different (cont.) l Clients n Plaintiff’s reason for litigation  Lottery  Principle  Other needs

u Each Mediation is Different (cont.) n Defendant’s approach  Economic  Personnel issues  Principle

u Each Mediation is Different (cont.) l Insurance n Which carrier n Inside or outside representation of carrier

 Merits of Case u Substance n Type and Merits of Claim l Documents l Experts n Damages l Types of Damages

 Merits of Case (cont.) n Court l State l Federal n Jury n Witnesses l Credibility

Two Recurring Mediations Hurdles u Initial Demands/Offers n Irrational Plaintiff Demands n Irrational Defendant Responses u Breaking Impasse n Various Approaches

Irrational Plaintiff Initial Demands u $1.0 Billion vs. ($-3.0) Case n Effect on Process l Cannot do “American Style Negotiation” l Plaintiffs argue “I have been more reasonable.” l Defendant never gets to “best number” l Creates atmosphere of “no settlement”

u Plaintiff Needs to Start with “High Number” But One With a Rational Basis n Plaintiff should explain how and why opening number selected l For Example: n Back Pay – ID Comparables

u Plaintiff Needs to Start (cont.) n Compensatories – ID Effects of Treatment Medical Issues n Punitives – Listing of Awards in Jurisdiction

Possible Mediator Approaches to Irrational Demands u Stop Plaintiff Before Irrational Demand Made n Virtual Negotiation u Use Conditional Demand/offer n Mid Point Issue

Possible Mediator Approaches (cont.) u Make Interim Mediator Proposal n Base Number n Base Range

Breaking Impasse u Possible Approaches n Single Party Cases l BATNA (“Getting to Yes”) n Right Hand vs. Left Hand Analysis

Hypothetical- for Analysis u Plaintiff is Terminated Employee Who Claims Retaliation Under Section 1981 n Demands $1.0 Million l Damages claim weak – has fully mitigated with new job l Defendant has fairly high risk of liability

Right Hand – The Defendant Analysis u Defendant’s Attorneys Fees - $200,000 u Plaintiff’s Attorneys Fees - $250,000 u Realistic Damages Award - $50,000 u Possible But Unlikely Award - $1,000,000

Economic Outcome n Cost to Defendant - Best Case - $200,000 l Defense fees n Cost to Defendant - Likely Case - $500,000 l Defense fees; Plaintiff fees; damages n Cost to Defendant Unlikely but Possible - $1,500,000 “What is correct Settlement Amount?”

Left Hand – The Plaintiff Analysis u “Likely Range” of Jury Verdict - $50,000 to $1.0 Million n Plaintiff Risk Rate – 75% chance of winning for $50,000 u Result of $50,000 Verdict l - ($ 10,000) – Costs l - ($ 15,000) – Taxes

The Plaintiff Analysis (cont.) n Net: $15,000 to Plaintiff – Plus 3-Year Delay n Risk of Loss 25% plus Pay Defendant Costs - $10,000 n Risk of AMT Treatment

u Result of $1,000,000 -Verdict 250,000 - Fees Award $1,250,000 (500,000) - Fees and Costs Payment (375,000) -Taxes $375,000 -Net to Plaintiff

u - 3-Year Delay u - Risk of Loss u - Very Low Probability of Success u - 25% Probability of 0 u - Punitives Treatment

Other Single Plaintiff Settlement Approaches u Long Sessions vs. Deadlines u Caucus Merit Assessments u Baseball Arbitration u Allocations to Compensatory Damages

Other Single Plaintiff Settlement Approaches (cont.) u Treatment of Some Types of Compensatory Damages as Non- Taxable n Assumption of Risk u Each Side Selects Number in blind and agree to split the difference if within “X” of each other u Mediator’s Final Proposal n Draft of Controlling Terms

PRAYER u Wants vs. Needs u Rapport

Class/Multi-Party Arbitrations u Mock Trial u Single Issue Trial u Mediator Draft of Provisions u High-Low With Arbitration n Detroit Edison, Coke

Class/Multi-Party Arbitrations (cont.) u Coupons n Winn Dixie, Ingles u Reverter Pools n PPG u Size of Pools Based on Number of Claims n Sears

Class/Multi-Party Arbitrations (cont.) u Dixiland Approach n Claims made before relief established u Use of Mediator’s Proposal

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