Page 4 - Alternative Dispute Resolution

S4 | Monday, March 30, 2015 | Alternative Dispute Resolution
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Realistic Approach
Take a Then the next question is what the odds

are that a judge or jury will find liability. Law-
yers are fortunate in this day and age that
they need not rely just on their intuition in To Settlement Strategy
addressing questions like this. One of the best
tools available is jury focus group work. By
testing a case with a pool of people that mir-
rors the actual jury pool, one can evaluate
how certain business practices will be viewed And Mediation
by the judge or jury. It may well prove to

be the case that certain practices that have
been regarded as standard in the industry and
acceptable may not be viewed the same way
by those who are not steeped in the affairs of Maximize your chances for an acceptable agreement.
the business. If a case is large enough, it may
well be that individual witnesses’ testimony
can be evaluated by the jury focus group or
even that a full mock trial or mock arbitration
can and should be held.

The result of these exercises is to pro-
duce a number, albeit one that necessarily
is imprecise. In considering what that num-
ber means for the purpose of negotiating a
settlement, the focus should not be on what
a great or good settlement would be. After
all, great or even good settlements rarely
take place. Rather, at the end of the day,

the focus has to be on what is the lowest
figure one would accept as the plaintiff or
the highest amount one would pay as the
defendant. Clients should ask their lawyers
what number they would recommend to
accept as “barely tolerable” rather than
going to litigation with all the attendant
risk and expense. The concept of “barely
tolerable” is important because at the end

of the day, particularly if there are skilled
negotiators on either side, sometimes that
is all that can be achieved in a settlement.
Putting the question in just that way makes CK
people face and make tough choices. The STO
participants in mediation often need to be BIG
told explicitly to abandon their initial goal
of achieving a settlement that is a home
run because those are rarely achievable

Lawyers have the obligation to raise
the topic of settlement. They need to
take the risk that the clients will regard
them as “weak” if they raise the subject.
Furthermore, the decision-making pro-
cess on settlement has to be moved from
those whose conduct is at issue to those
who bear the economic consequences of

a win or loss. Frequently, the people who
are involved cannot step back and work
through the problem objectively. This is
totally understandable, but can be a real
obstacle to settlement. When the plaintiff
is an individual, this issue rears its head be achieved. Finally, the article will address of an objective assessment really does not
throughout the life of a case. Sometimes, the By mark E. SEgall
the utility of a mediator’s proposal in helping necessarily change more than at the margin
spouse or significant other of an individual the parties conclude an agreement.
as the case proceeds. That explains why so
plaintiff can be a useful sounding board if A s is well-known, almost all civil litigation many companies have adopted formal early

the plaintiff allows them to be part of the is resolved by settlement rather than The Evaluation of Risk
case assessment programs as part of their
process.
by trial. nonetheless, far too many cli-
standard operating procedure. But, even
If the client is a business with a full liti- ents and law firms litigate cases in a manner The most fundamental thing that law- assuming an early case assessment is made,
gation portfolio, this process needs to be that makes settlement far more difficult and yers must do from the moment litigation this same analysis must be done again and
undertaken with respect to every case of expensive than it should be. This article will becomes a possibility is to assume owner- again at periodic intervals throughout the
significance. Otherwise, one can have no explore how parties should evaluate litiga- ship of the litigation opportunity or risk. life of a dispute. If discovery has produced
confidence in the level of litigation reserves tion opportunity and risk, and how media- Lawyers have an obligation to evaluate some bad results or the judge has issued a
that have been established for the portfolio tion should be conducted to maximize the constantly the risk or reward (depending ruling that probably will affect the ruling
as a whole. Similarly, this form of rigorous
chances that an acceptable settlement will
on whether the client is the plaintiff or the adversely, that needs to be factored into a
case-by-case analysis is what enables heads defendant) and figure out the settlement new analysis.
of litigation at major companies to be com- and litigation strategy. In virtually every In making this assessment, it is crucial to
fortable with the representations they are mark E. SEgall, former head of litigation for JPM- case, an early case assessment is in order. focus on what reasonable best- or worst-case
making internally, to their outside auditors, organ Chase & Co., is a mediator and arbitrator with It is remarkable, but not surprising, that in damages are. If there are a range of possible
and ultimately to the investing public.
JAMS.
a very high percentage of cases the result
damages, then those should be assessed as well.