Tuesday, June 30, 2015

Rule 1

The reformers who drafted the Federal Rules of Civil Procedure in the 1930's thought that if we could only get rid of the complexities of ancient pleading practices, and liberalize discovery, cases could be fairly adjudicated on their merits instead of being won or lost on technicalities. Their intent can be gleaned from Rule 1, which provides that the rules "should be construed and administered to secure the just, speedy, and inexpensive determination of every action and proceeding."

To a large extent, the simplified rules we have been living with for so many years must be judged a success, simply because they have stood the test of time. On the other hand, hardly anyone would say that Rule 1 accurately describes the way civil cases are currently processed. We have encrusted the original simple pamphlet enacted in 1938 with so much commentary and interpretation that the rules are on their way to becoming as arcane as the system they were designed to replace. We no longer administer the rules to remove roadblocks to just, speedy and inexpensive determinations of every action and proceeding. Instead we have created so many new roadblocks--mainly the burden of expensive discovery, but also new opportunities for motions--that the whole premise of the federal rules project must be called in question.

The rules ought to be re-written and streamlined again from top to bottom, which would be an endeavor comparable in scope to the original project. Such a revamping should recognize that the vast majority of cases are never going to be adjudicated on the merits anyway, and should better incorporate alternative forms of dispute resolution into the rules of civil procedure. A simplified set of rules could eliminate steps that are unnecessary for the vast majority of cases that not going to trial anyway, and could also encourage parties to move toward resolution rather than engaging in wasteful adversarial behavior. At the same time, simplifying the rules could make it possible for more cases to go to trial, because the cost of litigation would present less of an obstacle. (My own radical proposal for an overhaul of the federal rules can be found here.)

One commendable effort to reform the rules has been undertaken by the American College of Trial Lawyers and the Institute for the Advancement of the American Legal System. The task force has compiled a set of principles that still exalt the ideals of Rule 1, and that seek to create more flexibility and proportionality in the civil justice system to allow cases to be resolved in more appropriate ways. Some of these ideas are being incrementally adopted in amendments to the Federal Rules.

I'm not sure I will live long enough, however, to see the kind of wholesale reform that I think is needed. There is too much resistance to change in the fearful legal profession. And there is too much partisanship and paralysis in the political system to allow that kind of change. That means that the only practical way now to create the kind of streamlined dispute resolution process that would live up to the ideals of Rule 1 is to do it at least partially outside the purview of the court system. More on how to do that in subsequent posts.

Monday, June 22, 2015

What works

A mediator I know was explaining his system of taking and cataloging notes from his mediation sessions, to help him learn what was working and not working. He writes down phrases he has used that seem particularly effective, and keeps them on note cards. And he sometimes thumbs through his stack of cards during subsequent mediations to see if he can find something useful.

According to this mediator, impasse does not exist. Instead, when parties get stuck, he prefers to tell them only that the dispute probably will not settle that day, preserving the hope that it will settle at a later time when the parties are ready.

I have also found that the concept of impasse is not particularly helpful. It's too simplistic, for one thing, as there are a wide variety of situations in which negotiations can get bogged down. For example, the parties may need more information before they will move off their positions. Or one or both sides may be refusing to budge for tactical reasons. Or the appropriate decision-maker needs to be consulted before additional concessions can be made. If we use the term "impasse" to describe all these different scenarios, the term doesn't have much meaning. Moreover, the term "impasse" doesn't provide any guidance for moving the negotiations forward. It suggests instead that the process has reached a dead end.

If you have a stack of note cards or some other tools available to show the parties some ways to keep the process moving, you have no reason to suggest to them that they have reached an impasse. Instead, just pull out another card.


Sunday, June 14, 2015

Trade Negotiations

Some thoughts based on my experience with negotiation and mediation in general that may be relevant to the ongoing Congressional fight over passage of fast track authority for the Trans-Pacific Partnership (TPP) trade agreement (which suffered a major setback on Friday): First, there are great virtues in preserving the secrecy of negotiations until the deal is complete. Critics of the TPP have thrown suspicion onto the deal because many of its terms remain shrouded in secrecy. But confidentiality is something we fight to preserve in mediation and other forms of negotiated conflict resolution. One reason is to allow negotiators freedom to make aggressive offers and demands without fear of being second-guessed by their principals until the deal is completed. Another is to try avoid unnecessarily angering those who have to approve the deal before they fully understand the trade-offs involved in the final agreement.

In addition to maintaining confidentiality, it is helpful to the negotiating process for negotiators to remain open-minded. Even if the other side makes what is considered an unacceptable proposal, that should not be a reason to scuttle the negotiation. Instead, it is more constructive to present a counter-proposal, or to present something the other side may view as equally unacceptable as a condition of acceptance of their outrageous proposal.  I always caution parties to settlement negotiations to try not to react too negatively to the other side's insulting offers or demands. Instead they should be treated as invitations to make counter-proposals. I also caution parties not to rush into an evaluation of the merits of the deal. Wait until the negotiators have made the best deal they think they can get before comparing that potential agreement to the alternative of no agreement.

Particularly with something as complicated as a multi-nation trade negotiation covering a wide range of issues, it is important to step back and look at the bigger picture rather than to pick apart provisions that appear harmful to one side. In general, when barriers to trade are reduced, industries that have trouble competing against foreign suppliers are going to face even greater challenges, while industries that are having success in selling abroad are going to have even greater success. The economy may benefit from lower prices for goods made abroad, as well as from greater revenues for increasing exports. The net positive and negative effects  have to be weighed against each other before the deal as a whole can be deemed harmful. This is why every modern president seeks and usually obtains fast-track authority for trade agreements: so Congress can evaluate the package as a whole, rather than pick apart the pieces and risk its destruction.

One final consideration in evaluating almost any kind of negotiated agreement: Let's not overlook the value of peace itself. Parties often focus on the merits of the issue being negotiated, and fail to give sufficient consideration to the cost of failing to resolve the issue. They fail to put a high enough price on the cost of continued conflict. These costs and values are particularly dramatic in the context of international trade agreements. Trade can create greater understanding among the peoples of nations engaged in trade, as well as economic benefits. The alternative to free trade is suspicion, distrust, and even war. The first thing that countries suspend when they resort to war is trade. Thus, trade can be seen as one of the most effective deterrents to war, because when the economies of various countries benefit from trade, they are less likely to resort to war.

In the current round of negotiations over this trade deal, we see critics of the deal failing to consider all of the foregoing. They are suspicious rather than protective of the secrecy of the negotiations. They are unduly focused on the merits of particular parts of the deal, and unable to evaluate it in its entirety. And they fail to put a sufficient value on the virtues of making an agreement per se. I'm not arguing for or against the TPP. What I am saying is that there are good reasons for keeping negotiations secret; there are good reasons for the president to seek fast track authority to allow a vote up or down of the agreement as a whole; and there are a great many issues that must be considered in evaluating the benefits and costs of such a deal, including the value of resolving disputes by agreement instead of by more destructive means.

Friday, May 29, 2015

John Nash

Last week we heard the news of the strangely untimely death of mathematician John Nash, whose life story was made famous in the book and film "A Beautiful Mind." The Nash equilibrium is a concept sometimes touched upon in teaching negotiation theory, and it's not difficult to understand why we should try to understand it, even if we might have trouble doing the math. What Nash and others taught us that is especially relevant to conflict resolution is that parties involved in conflict will often rationally both choose a sub-optimal outcome for themselves. Therefore they will benefit from learning how to be more cooperative with their adversary. That means Nash's mathematical theory helps prove the usefulness of mediators or some other mechanism to encourage greater cooperation.

But Nash's own life story, and even his tragic death, prove something else also, which is that people are not governed solely by rational calculations, whether selfish or cooperative. Nash's own mind was taken over by irrational impulses for many years, due to his struggles with mental illness, and he only regained its rational functions late in life. His death in a freakish taxi accident, also could not be predicted by any mathematical equation or other rational process. Those hoping that a rational formula can be devised to resolve conflict are going to be disappointed. We also have to take account of irrational impulses, feelings and emotions, and just plain bad luck.

Tuesday, May 12, 2015

The Art of Negotiation

A long time ago, when I was fairly new at law practice, I represented a plaintiff in a contentious sexual harassment case against a large company. After a series of pre-trial battles, the defendant's counsel opened the door to the possibility of settlement, throwing out an insultingly low-ball number. I wasn't sure how to respond.

At that point in my career, I thought I knew how to litigate, but nobody had ever taught me how to negotiate. I had never received any training in negotiation strategy in law school, and very little at my law firm. The subject simply wasn't taught at the time. So I honestly didn't know the best number to come back with in order to lead the process to a good result for my client. For some reason I confessed my weakness to the other side, saying something that indicated I wasn't sure what to do next. My adversary's response was to ask me whether there was anyone else at my firm who was more skilled at negotiation who could get back to him with a response to his offer.

Suddenly I understood two things. First, there was nobody else at my firm who could do this better than I could. This was my case, and I knew it better than anyone. Second, I realized from defense counsel's somewhat desperate request for somebody to negotiate with, that the other side was extremely anxious to make a deal. Their aggressive litigation strategy had failed to make us go away, and now they were looking at the high costs and high risks of proceeding to trial. I knew they would pay more than they were offering, even though I wasn't sure how much I could talk them up.

Once I figured out how to process what the other side was telling me, I had the confidence to handle the negotiations, And I was able to engage in the kind of give-and-take necessary to get the deal done. After that, I never again thought of myself as someone who didn't know how to negotiate.

This story came back to me as I was reading a book called The Art of Negotiation, by Michael Wheeler, a professor at Harvard Business School, who is also part of Harvard's well-known Program on Negotiation. I picked up the book after I had a chance to hear Wheeler talk at UCLA about his theories of negotiation. The book is filled with entertaining stories about buying houses and cars, and closing business deals. Wheeler teaches classes on negotiation, so he obviously believes students can learn about negotiation in a classroom. But he also understands that negotiation is more of an art than a science. His theme is about the importance of improvisation in negotiation: responding to the cues and information given by the other side It's about the attention, presence of mind, and creativity needed to succeed in negotiation.

In other words, the secrets of negotiation lie not so much in knowing how to parry and thrust against the other side's maneuvers to score the most points. In fact, Wheeler repeatedly emphasizes that pushing for the best possible deal is not necessarily to a negotiator's advantage. Sometimes an overly aggressive approach will cause the other side to walk away, and sometimes getting more than your fair share will end up costing you in the end.

Instead, being a good negotiator is more about being in tune with the needs and desires of the other side, the way that good jazz musicians or theatrical improvisers respond to what they hear from their counterparts. It's about having a plan and then throwing that plan out the window as soon as you encounter the unpredictable response of the other side. And it's about learning how to treat our adversary as a partner in a project that requires more collaboration than competition.



Tuesday, May 5, 2015

Doug Noll show

I was interviewed recently by California mediator Doug Noll, on topics ranging from the business of mediation, to the decline in joint sessions, mediation confidentiality, and mediator certification. I also had a chance to trot out some of my pet theories about how to reform our justice system in general, and how mediation training is helpful in every walk of life, not just in training to become a mediator.

The audio broadcast can be found here.

Sunday, April 19, 2015

Applied decision theory

Richard Birke, a law professor at Willamette University, gave a talk at the ABA Dispute Resolution conference expressing frustration with the term "Alternative Dispute Resolution." The term is too limiting to describe the many ways that the skills of negotiation, mediation, and other forms of conflict resolution can be applied in practice. It's also inaccurate, since "alternative" means of resolving disputes probably comprise the vast majority of resolutions.

In the status hierarchy of law schools, the field of ADR has always been treated as something of a stepchild, not considered as prestigious as traditional subjects like Constitutional Law or Contracts. It's not clear that the study of conflict resolution even belongs in law school, since law comprises only a small part of the syllabus. Yet Birke is finding his colleagues in more traditional legal subjects, especially the more esoteric ones like Labor Law, wondering if any of their students will ever use the information they are imparting. Meanwhile teachers of conflict resolution, which embraces concepts from economics, psychology, and a myriad of other disciplines, and not much "law" at all, can see immediately the usefulness of the skills they are teaching. We all benefit from learning how to negotiate and how to solve problems.

Not only are the skills being taught in conflict resolution studies useful to pretty much anyone who has to interact with other human beings, those skills find practical application in a number of new career paths for attorneys (and also non-attorneys). While graduates of mediation training often have a hard time finding work as traditional "mediators," they can apply their skills to solve problems for clients in ways that traditional lawyers may be ill-equipped to handle. ADR specialists can help clients re-structure their businesses, deal with succession issues, avoid litigation, assist with contract negotiations, or any number of other conflict management and resolution scenarios.

Birke thinks we need to come up with a new name for this field, one that better expresses the wider array of applications of its teachings. His suggestion is "Applied Decision Theory," a name that might introduce its own set of confusions; but at least avoids some of the negative connotations of "Alternative Dispute Resolution." He recognizes the challenges of describing the field of study encompassed by this new term. And he also acknowledged the large problem of how to market this specialty, both to prospective students, and to potential clients who are accustomed to thinking that if they have a problem with somebody, they should probably call a lawyer to solve it, expecting that lawyer to employ an adversarial approach. It will probably take a while before it occurs to people experiencing injury or dealing with other forms of conflict, that they should call their local applied decision theorist.

Saturday, April 18, 2015

Re-living trauma

love to know
Einstein supposedly said that the definition of insanity is doing the same thing over and over again expecting different results. I learned this week that even though research has shown for about 20 years that grief counseling does not work--in fact it increases the stress levels of those being counseled--we  haven't given up on the practice. In a lecture at the ABA Dispute Resolution Conference, Professor John Medina explained how grief counseling as traditionally practiced, which involves asking the traumatized victims to recount their experiences shortly after the traumatizing event, can cause these victims to enter into a vicious cycle of rumination on the event and their part in it that does not help them recover. In fact, it can leave affected persons even more impaired.

Jim Pennebaker, a professor at the University of Texas developed a more sophisticated variant of grief counseling, in which victims are asked to wait three weeks, and then engage in writing down a description of the event on successive days. The waiting period is designed to take advantage of the natural process by which unpleasant memories can fade. And in the process of writing a story about the traumatic event, the critical instruction, which apparently makes all the difference, is to view the event as if from the disinterested eye of a neutral observer or cameraman. After doing that, stress levels and other harmful physical and mental effects from the trauma, pretty consistently go down, often close to baseline levels.

This research seems to have obvious implications for conflict resolution, though these implications have apparently never been studied or proven. We know that the traditional litigation process, and even mediation the way it is often practiced, causes participants to experience anew the negative effects of the original perceived injury, and even gives them the opportunity to receive and inflict new injuries on opposing parties. The grief counseling studies suggest that this kind of repetition of trauma is detrimental to reducing stress and other emotions that have been stirred up by conflict, emotions that need to be addressed before conflict can be resolved. We also know that one goal of mediation is to help parties view conflict more objectively, and even to learn to understand the opposing party's point of view to some extent. All of that suggests that simply asking parties to "vent" their anger or other feelings about the opposing party may be harmful to the process of resolving conflict. On the other hand, helping parties talk about the underlying events in a more objective manner may help them arrive at a more rational state conducive to resolving the dispute.

Wouldn't it be nice if someone would do the research that might help to prove what works and what doesn't, so that eventually we stop doing, over and over, the things that are unhelpful?

Measuring ADR effectiveness

The state of Maryland commissioned a cutting edge research project that has succeeded in measuring the effectiveness of the state's court-connected ADR program in limited jurisdiction courts. This study attempted to do much more than track settlement rates achieved through the program; the researchers also assessed the satisfaction of participants with the system, comparing the results with control groups of litigants who did not utilize the program. They found that participants who achieved settlement through ADR processes were most satisfied with court than those whose cases were adjudicated by the court. Even more tangibly, those cases were more than 20% less likely to return to court for enforcement or other follow-up action, a finding of considerable cheer to court administrators attempting to secure ADR funding from the legislature.

The study also attempted to measure more precisely what features of the ADR process participants found most beneficial, such as whether issues were addressed by the court, or whether participants took responsibility for their actions. These questions found significant gains through the use of ADR.

Drilling down even more deeply, this study even attempted to measure what techniques used by court mediators were most effective. This effort required the researchers to monitor mediations, code various types of mediator interventions, and correlate those with participant responses. They could thereby determine whether techniques such as eliciting information from participants, or reflecting what participants told the mediators, or making suggestions to the parties, were more successful in achieving agreements as well as satisfaction by the participants.

This research found, for example, that eliciting solutions from the parties had a positive impact on reaching agreement in mediation. On the other hand, using more evaluative or directive techniques had some negative long-term impacts. And participants reported feeling less satisfied with caucus-style mediation than those who relied more on joint sessions.

Not all of these results have been published yet, but more information about this study can by found at www.marylandADRresearch.org


Monday, April 6, 2015

Woman in Gold

About halfway through the new movie Woman in Gold--which tells the story of Maria Altmann's lengthy legal battle to recover the famous Klimt painting of her aunt from the Austrian government--the parties try to resolve the dispute by mediation. At the mediation, Altmann (played by Helen Mirren) offers to allow the Austrians to keep the painting if they will only acknowledge that it was stolen property (looted from her family by the Nazis), and pay some amount in compensation. It was a framework for negotiations that most mediators would jump at, because if the framework were accepted by the other side, the only thing left to negotiate would have been the amount of compensation. But the Austrian representative refuses even to consider admitting that the painting was stolen, and Maria and her young attorney walk out of the negotiation.

At that point, Altmann's side felt fairly confident of their legal position. Their main risk was that Maria would not live long enough to see the legal battle through. So they agreed to arbitration in Austria. After the arbitration was decided in their favor, the same Austrian representative attempted to re-instate a version of the deal discussed at the mediation. Too late, says Maria. She now feels so abused by the Austrian government's resistance to her claim, and its repeated refusals to negotiate, that she is determined that the painting must travel to America, as she was forced to do herself many years earlier.

A nice example of how opportunities to resolve conflict at mediation are often squandered, and how litigation opens old wounds and makes problems more difficult to resolve in a consensual manner. And how winners are not usually magnanimous in victory. Rightly so, it would seem in this case. So what was the value of mediation in a do-or-die case like this one? At the very least it reminded the victors that they had made a reasonable settlement offer that the other side should have accepted. That experience justified Altmann's refusal to make any concessions to her adversary after her victory.