Mediation 201: How Mediation Works

Hopefully, Mediation 101 gave you a clear understanding as to what mediation is.  Now, let’s discuss how mediation works.

Pre-Mediation Considerations

While selecting a mediator can be critical, unlike when selecting an arbitrator, parties should not be very concerned that a biased mediator might force them to enter into a “bad” settlement.  Because mediation is voluntary, a mediator simply does not have the power to force a party to agree to any settlement with which that party is not completely satisfied.  What is crucial about the selection of the mediator, however, is that s/he has credibility with the ultimate decision makers, i.e., the parties, not counsel.  Without credibility, the parties are not going to give the mediator’s comments the full consideration that might lead them to modify their positions and settle.  Consequently, it is important to ask questions like the following:

  • If industry knowledge is important in understanding the dispute, does the potential mediator have sufficient industry knowledge?
  • Will it impress the parties and increase the persuasiveness of the mediator if s/he is a former judge and/or has some other has special background or experience?
  • How many cases similar to the one at issue did the potential mediator handle as an advocate or judge, and how many of those cases did not settle? (Handling multiple cases of a similar type that went to a judgment will give the mediator more credibility when suggesting to the parties what they will likely face if their case does not settle).
  • How many cases similar to the one at issue has the potential mediator handled as a mediator?
  • What is the potential mediator’s style/personality, and will it be an asset or a liability?  For example, is a “table-pounder” likely to be effective, or are the parties going to be more receptive to someone who takes a coolly analytical approach?

Once a mediator is selected, the parties generally submit written materials so that the mediator can have a full understanding of the dispute at hand.  While the parties sometimes simply agree to send the mediator copies of pleadings on file in court, more often than not each side prepares a written position statement that at least supplements any court filings also provided.  While these position statements usually are provided to the opposing party, in some cases there are reasons not to do so, and, as discussed below, the mediator will not share confidential statements with the opposing party. 

The Day of the Mediation

The actual mediation process typically begins with all parties and counsel in one room and the mediator going over the ground rules.  Two of the most important rules, which are designed to foster an environment that will give the parties the best chance to settle, are:

  1. Nothing said in the mediation can be used against that party.
  2. The Mediator will not disclose anything revealed in confidence to an opposing party.

After the ground rules are discussed, counsel for each side generally presents an overview of its client’s position on the legal merits, discusses any practical considerations that might be relevant, and/or discloses anything else that might affect any party’s willingness and/or ability to resolve the dispute.  This can be a critically important event because it may be the only chance that your counsel ever has to speak directly and frankly to the opposing party, as opposed to having his or her message filtered through opposing counsel before it ever gets to the decision maker.

After the “opening statements” are given, the parties generally go to separate rooms and the mediator will go back-and-forth between those rooms.  During these private sessions (which may last an hour or more), the mediator will comment on the strengths and weaknesses of each party’s case, discuss matters that are not directly (or even indirectly) related to the litigation that might affect a party’s ability or willingness to settle, and push each side to candidly examine the costs and benefits of litigating versus settling.  Because the mediator will also convey offers as s/he goes back and forth between rooms, this process often is referred to as “shuttle diplomacy.”

If all goes well, at the end of the day the mediator will have brokered a settlement.

In Mediation 301, I will discuss how to ensure that the settlement reached at a mediation is binding, and also discuss the types of matters where mediation is most likely and unlikely to be successful.

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