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THE BASICS OF MEDIATION EVERY ATTORNEY SHOULD KNOW Erica Bristol is an intellectual property (IP) attorney and commercial mediator, specializing in IP disputes. She received her J.D. from the UCLA School of Law in 1999. She served as in-house counsel for over 11 years, and she has been a commercial mediator since 2006. Erica has served as a panel mediator for the United States District Court, Central District of California mediating IP disputes, and a panel mediator for the Los Angeles, Santa Barbara and Ventura County Superior Courts. She is currently a panel mediator for the World Intellectual Property Organization. Erica is the Chair of the State Bar of California, Litigation Section’s ADR Committee, and an Executive Committee member of the State Bar of California’s Intellectual Property Law section. Erica is the Principal of EB Resource Group in Encino, California, specializing in corporate IP training for management and staff, IP risk management consulting and mediation services in various areas of law. Erica has written numerous articles such as “Mediation Privilege: Understand State, Federal Distinctions,” in the Los Angeles Daily Journal, and “Trade Secret Mediation: A Mediator’s Perspective,” in the International In House Counsel Journal. She can be reached at ericab@ebresourcegroup.com or (818) 753-2326.

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Table of Contents

I. WHAT IS MEDIATION? ...................................................................................................................... 3

II. MEDIATION VS. OTHER FORMS OF ADR .......................................................................................... 5

III. BENEFITS VS. LIMITATIONS OF MEDIATION .................................................................................... 6

IV. MEDIATION STATUTES, LOCAL RULES AND CASES .......................................................................... 7

VI. ETHICAL CONSIDERATIONS ............................................................................................................... 9

VII. DRAFTING CONSIDERATIONS ......................................................................................................... 10

VIII. ELEMENTS OF A MEDIATION SESSION: BEFORE, DURING AND AFTER ......................................... 11

IX. TIPS FOR SUCCESSFUL MEDIATIONS .............................................................................................. 13

DISCLAIMER: The following materials and accompanying Access MCLE, LLC audio CLE program are for instructional purposes only. Nothing herein constitutes, is intended to constitute, or should be relied on as, legal advice. The author expressly disclaims any responsibility for any direct or consequential damages related in any way to anything contained in the materials or program, which are provided on an “as-is” basis and should be independently verified by experienced counsel before being applied to actual matter. By proceeding further you expressly accept and agree to Author’s absolute and unqualified disclaimer of liability.

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I. WHAT IS MEDIATION?

a. In General. Mediation is an informal, “out of court” process whereby a neutral third party, the “mediator,” facilitates communication and negotiation between parties to assist them in resolving a dispute. Mediation is a confidential, efficient, cost-effective manner of resolving legal disputes without having to resort to litigation. In mediation, the parties attempt to settle the matter through negotiation, rather than having a third party impose a decision that is binding on the parties.

b. Statutory Definition. In some cases, mediation is defined by statute, such as in a state’s evidence code. For example, California Evidence Code Section 1115 states that mediation is “a process in which a neutral person or persons facilitate communication between the disputants to assist them in reaching a mutually acceptable agreement.”

c. Form of Alternative Dispute Resolution (ADR). Mediation is a form of alternative dispute resolution (ADR), meaning a method of resolving a legal dispute outside of litigation. While litigation is a formal, adversarial process that can result in a binding decision by third party, the mediator has no decision-making power. The parties control the process and determine the outcome, with assistance of and guidance from the mediator.

d. How and When Mediation Occurs.

1. By contract. Mediation can be required by contract (oral or written). Sometimes the contract terms state that the parties must attempt to resolve the dispute through mediation prior to resorting to arbitration or litigation.

2. Voluntary agreement. The parties to a legal dispute may agree to mediation voluntarily, such as by a suggestion of a party or legal counsel prior to or during litigation, to avoid the cost and expense of trial.

3. Court Ordered. Many courts have ADR programs that require litigants to participate in mediation before proceeding to trial, and local rules relating to the administration of court-ordered mediation.i The courts typically set a time frame in which the mediation must be scheduled and conducted, along with other other administrative requirements.

a. Depending on the jurisdiction, the panel mediator may be selected randomly from a pool of panel mediators in the court’s ADR program, or the parties may have the ability to select a specific panel mediator. The parties usually have the option to hire a private mediator for the dispute. In many jurisdictions the court panel mediator provides his or her services for a limited number of hours at no cost, after which the parties may decide to end the mediation, or, if they desire to continue, they may be required to pay the mediator’s usual and customary fees.

b. Sometimes a court will order a case into a mediation before the parties have had a sufficient time to conduct discovery or enough

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information to make a well-informed decision, and the matter does not settle. In those cases, the parties may seek to conduct a second, private mediation later on when the parties have sufficient information to resolve the dispute.

c. Upon the conclusion of a court-ordered mediation, the mediator typically must file a statement with the court indicating whether or not the mediation occurred, and whether or not the parties settled at mediation. The court may also inquire as to whether or not the parties attended the mediation in person, as required by the court’s ADR program.ii

e. Mediation Costs. The costs involved in mediation vary, depending on the complexity of the matter, the number of parties and counsel, the mediator’s fees, travel and lodging expenses incurred in attending the mediation, and the length of the mediation. A mediator’s fee can be a flat fee, hourly or based on a half-day or full-day, along with additional administrative fees. Counsel should consider including an estimate of the mediation costs in the litigation budget, if and as appropriate.

f. Attending the Mediation. There are numerous persons who can attend the mediation. A party may attend the mediation represented by counsel, or the party may participate without representation. Other potential attendees include witnesses, consultants, experts, translators, insurance representatives and even new associates who need to develop experience negotiating in mediation. The decision as to whether or not a person should attend the mediation should be determined by comparing the benefit of having the person attend and their overall contribution to the possibility of settlement, with the effect of having too many persons attend and related costs.

g. Selecting a Mediator.

i. The selection of a mediator can be very important in the outcome of the mediation session. The mediator’s personality, mediation style, background and experience can often assist the parties in resolving the dispute. The parties can select a panel mediator if the mediation is court-ordered; the parties can seek a private mediator from a commercial panel, such as the American Arbitration Association, Judicial Arbitration and Mediation Services or various smaller commercial mediator panels; or the parties can select an independent mediator. The mediator can be an attorney (current or former), or a non-attorney. Sometimes the mediator is a retired judge.

ii. The mediator is not selected by one party alone; usually the parties must both agree on the mediator, including the mediator’s location (or the location of the mediation session, if the mediator is willing to travel). In private mediations, the parties themselves rarely know of or select the mediator; each party’s legal counsel usually recommends a mediator to the parties. Whether the party selects the mediator or legal counsel recommends the mediator depends on the type of dispute involved and the jurisdiction.

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iii. The parties must agree on the mediator’s fees, and usually the parties share the fees equally. On occasion one party or the other will pay the entire fee, such as when a large commercial entity has a dispute with a consumer. Other times the fee is split unevenly for one reason or the other. There are some mediators who offer their services for free, such as mediators serving on court panels, in community mediation organizations or retired attorneys and judges. Panel mediators often provide services pro bono for a limited period of time, and very often the matter can be settled within that time frame.

iv. The mediator must conduct a conflict check to make sure there are no conflicts of interest in serving as the mediator, such as if the mediator is an attorney and previously represented one of the parties, or the mediator has a financial or personal relationship with one of the parties. This is especially true if the mediator is also a licensed attorney, as the attorney’s ethical rules may be implicated. The mediator must disclose all actual and potential conflicts and obtain the parties’ waiver of the conflict before the mediator can serve as such. Often court-connected programs, private mediation panel contracts or the mediator’s own conflict of interest policy, will dictate rules for disclosing conflicts to the parties. If a party does not want to waive a conflict, the parties will have to select another mediator.

II. MEDIATION VS. OTHER FORMS OF ADR

a. Mediation is One Form of ADR. Mediation is one of the more popular forms of ADR due to its flexibility, cost-efficient nature and confidential approach. However, there are other forms of dispute resolution that have benefits and limitations different from mediation.

b. Arbitration. Arbitration is an out-of-court proceeding with aspects very similar to the litigation process. A neutral third party, the “arbitrator,” hears testimony, controls the discovery process, makes findings and renders a decision which is binding on the parties and enforceable in court. Arbitration can involve discovery rules that are much more informal than litigation, and an arbitration can be completed in a much shorter period of time than litigation, such as in one day. Unlike litigation where a judge is assigned to the case, the parties have the option to select the arbitrator and agree on the arbitrator’s fee. Parties to an arbitration have more control over the cost of the proceeding. The arbitrator’s decision can be binding or non-binding. In the case of a non-binding decision, a party can appeal the arbitrator’s decision in a court of law.

c. Early Neutral Evaluation (ENE).

i. In an early neutral evaluation, a neutral third party assesses and advises each party of the strengths and weaknesses of the party’s case and provides recommendations as appropriate. The neutral evaluates the possible outcome, should the dispute proceed to trial. Early neutral evaluations can occur in the pre-trial stage of litigation, before significant resources are spent preparing for trial. The neutral’s evaluations and recommendations are persuasive, but not binding on the parties.

d. Fact Finding.

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i. A fact-finding neutral third party conducts an investigation into cause of dispute by reviewing documents and interviewing the parties, witnesses and others. The neutral then presents the findings to the parties for consideration. Although the neutral has no decision-making power and the findings are not binding, they can be considered by the parties for negotiation and settlement purposes.

e. Mini Trial.

i. In a mini-trial, the parties conduct a “mock trial” before a neutral in abbreviated form. A limited version of each party’s case is presented. Mini-trials usually occur later on in the litigation process. The neutral has no decision-making power, but the mini-trial allows the parties to assess the strength and weaknesses of their case before proceeding to trial, which can assist the parties in reaching a settlement.

III. BENEFITS VS. LIMITATIONS OF MEDIATION

a. Benefits of Mediation. There are benefits and limitations of mediation that parties and counsel should be aware of.

i. Mediations are conducted out of court, which provides more flexibility and control over the process. A mediation can be completed in a few hours, a half-day one full day, much faster than the year or years involved in bringing a litigated case to trial. Mediations can be cost-effective and definitely less expensive than litigation. Mediations are informal and are not bound by the rigid process of litigation. The parties have control over the outcome and cost. One of the most attractive features of mediation is confidentiality. In general, all communications made in mediation are confidential and cannot be used against a party in a present or subsequent court action or proceeding. The parties are free to speak openly without fear of statements being used against the party in court.

ii. Mediation allows the parties to consider unique, creative options usually not available in litigation. A mediation can be conducted in person or virtually, such as via phone or web conference, saving the parties significant travel and lodging costs.

iii. A party is not required to settle or agree to any particular terms offered by the other party. The parties have complete control over the outcome of the session.

b. Limitations of Mediation. There are limitations to mediation, however, that the parties should take into account when considering mediation.

i. The neutral has no power to render a decision, and the parties do not have to settle. This could result in the dispute not being resolved in mediation, frustration of the parties, and additional expenses to proceed to trial, increasing the time and expense of resolution.

ii. The confidentiality restrictions could result in a party being unable to introduce valuable information and materials from the mediation, such as an admission of fault, which could help the party prevail in trial. Mediation confidentiality is not without exception. Many statutes, local rules and court cases create exceptions to

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mediation confidentiality that may not be anticipated by the parties, resulting in information and materials created for mediation being introduced in litigation.

IV. MEDIATION STATUTES, LOCAL RULES AND CASES

a. State Mediation Statutes and Rules of Court.

i. State Statutes. The process and rules for mediation are often set forth in state statutes, especially concerning mediation confidentiality and court-connected mediation. Often the mediation confidentiality obligations are set forth in a state’s evidence code. For example, in California, Evidence Code Sections 703.5 and 1115-1128 provide the rules for mediation confidentiality, and evidentiary prohibitions on using information and communications in litigation, along with the mediator’s competency to testify in Iitigated cases. It’s important for parties and counsel to be fully aware of the rules and restrictions concerning mediation confidentiality in the relevant jurisdiction, as these rules may vary.

ii. State Rules of Court. Some states have statutory court rules addressing the administration of ADR programs and mediation confidentiality. For example, court rules can determine the confidentiality of communications and materials made in anticipation of or during mediation. This does not mean that documents and information obtained during the normal course and scope of litigation may no longer may be introduced; it does mean, however, that if particular documents are created and communications are made solely in connection with the mediation session, it is unlikely those documents and communications will be allowed in litigation.iii

b. Federal Mediation Statutes and Rules of Court.

1. Federal Statutes. Pursuant to the Alternative Dispute Resolution Act of 1998, 28 U.S.C. 662(d), federal courts are required to abide by the confidentiality of mediation communications and materials. However, mediation confidentiality does not automatically mean the documents and communications will be privileged.

2. Federal Rules of Evidence (FRE) 501 states that: “The common law — as

interpreted by United States courts in the light of reason and experience —

governs a claim of privilege unless any of the following provides otherwise:

the United States Constitution;

a federal statute; or

rules prescribed by the Supreme Court.

But in a civil case, state law governs privilege regarding a claim or

defense for which state law supplies the rule of decision.”

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Essentially this means that for federal cases, the federal rules of

privilege will apply, but in civil cases where state law is used to decide a

case, the state law on privilege will apply. This has affected mediation

privilege in very significant way. Most if not all state courts have

adopted mediation privilege in one form or another.iv In federal court,

however, there is no common law “mediation privilege”; it exists on a

court by court basis. More information on federal mediation privilege

will be discussed below.

3. Federal Rules of Evidence (FRE) 408, which deals with offers to compromise and negotiations, prohibits the introduction of settlement discussions as proof of an admission or the validity or invalidity of a claim. This would apply to such discussions made in mediation. However, FRE 401’s exception-allowing such evidence for other purposes, such as proving bias or prejudice, negating a claim of undue delay or providing obstruction of justice, would allow such information to be introduced. Thus, evidence normally inadmissible and privileged in state court may be admissible under circumstances in federal court pursuant to the federal rules of evidence.v

4. District Court Local Rules. Most federal district courts with mediation programs have implemented local rules addressing the process of mediation and the selection of mediators within that court’s jurisdiction. For example, the United States District Court, Central District of California Local Rule 16-15 sets forth the procedures for the administration of the Court’s ADR program, the selection of the mediator, the filing of the mediator’s report and rules concerning the confidentiality of the mediation session.

V. MEDIATION CONFIDENTIALITY AND PRIVILEGE: STATE VS. FEDERAL DISTINCTIONS

a. State Courts.

i. Confidentiality. Most states have adopted and adhere to some form of mediation confidentiality, either by statute, regulation, court rule or common law. In this context, “confidentiality” applies to the confidentiality obligations the parties have to each other with regard to communications and materials made in anticipation of or during the mediation session.vi The parties to mediation can also agree to confidentiality by contract. Eleven states and the District of Columbia have adopted the Uniform Mediation Actvii which provides (with some exceptions) that “mediation communications”viii are confidential to the extent agreed by the parties or by other state law or rule.

ii. Privilege. Most state courts also consider communications made in mediation to be privileged, meaning they may not be discoverable or introduced as evidence in litigation by the parties, the mediator, the court or a third party. Under the Uniform Mediation Act, mediation communications are privileged and are not discoverable in evidence unless the privilege is waived by the party holding the privilege, or an exception applies. Each party to the mediation holds the privilege and may prevent

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others from disclosing mediation communications in a subsequent proceeding, such as litigation.ix The mediator and a non-party also hold the privilege, but only as to their own communications.x

b. Federal Courts.

i. Confidentiality. Mediation confidentiality exists in federal courts by statute. Under the Alternative Dispute Resolution Act of 1998xi, each district court is required to authorize by local rule, the use of ADR processes, such as mediation, in all civil actions. The Alternative Dispute Resolution Act of 1998 also states that “[u]ntil such time as rules are adopted under chapter 131 of this title [rule making power of federal courts) providing for the confidentiality of ADR processes under this chapter, each district court shall, by local rule adopted under section 2071(a), provide for the confidentiality of the ADR processes and to prohibit disclosure of confidential dispute resolution communications.”xii Most if not all federal courts have adopted confidentiality rules relating to their ADR programs, including mediation.xiii

ii. Privilege. There is no uniform federal mediation privilege in the United States. Some federal courts have adopted a mediation privilegexiv; others have declined to adopt the privilege in their jurisdictions; and still other federal courts have affirmatively denied the existence of mediation privilege in federal courts. For example, the 4th and 9th Circuit Courts of Appeal and the Federal Circuit have expressly declined to adopt a mediation privilege.xv

c. Attorneys Must Be Aware of Differences. It is important for attorneys to be aware of the difference between mediation confidentiality and privilege, and the existence or non-existence of federal mediation privilege varies depending on the relevant jurisdiction. Although mediation confidentiality appears to be standard in state and federal courts, there are exceptions. Attorneys whose clients desire mediation, who have agreed to mediation by contract or whose disputes will be determined by federal law especially must consider these jurisdictional differences when preparing for mediation, when advising the client of mediation confidentiality and privilege, when deciding strategically what will or will not be disclosed during mediation and when determining the choice of law by contractual agreement.

VI. ETHICAL CONSIDERATIONS

a. Ethical Rules. All attorneys are bound by ethical rules requiring them to keep clients fully informed. Attorneys must consider their ethical obligations when preparing clients for mediation, and specifically advising clients of their mediation confidentiality obligations. Attorneys must also abide by their own mediation confidentiality obligations.

b. Advising Clients. Attorneys should also consider whether they have ethical obligations to advise clients of the jurisdictional differences in mediation privilege in federal court, so that the client can make well-informed decisions about what the client will and will not disclose during mediation, and so that the client can anticipate possible outcomes concerning communications and materials made during the mediation. Attorneys must take care not to mislead clients into thinking a settlement will take place at mediation, that the client must

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settle, or that the other party is required accept the client’s offer. Settlements in mediation are voluntary, and the client should be very clear on this fact.

VII. DRAFTING CONSIDERATIONS

When drafting mediation clauses in contracts, attorneys should consider the following:

a. “Conditions Precedent” to Mediation. Attorneys should consider including a condition precedent when appropriate, such as requiring the parties to negotiate for a period of time before proceeding to mediation. The negotiation can be between upper management, such as the CEOs of disputing entities.

b. Mediation “Triggers.” Mediation can be triggered by one party providing the other party with a written demand for mediation pursuant to the contract, and by providing certain information, such as potential mediators for the other party to consider. The failure of party to demand or participate in mediation can result in the inability to recover attorneys’ fees and costs.

c. Selection of the Mediator. The contract can indicate a particular mediator, a commercial entity with a panel of mediators, or the parties can each submit potential mediators to each other for consideration.

d. Location of Mediation. The parties can and should determine the location of the mediation, such as the state, county or city where the mediation will be held. The location is important, as it may affect each party’s travel and lodging costs along with those of witnesses, counsel, experts, consultants and insurance representatives. Also, the parties can agree on whether “virtual” mediation (conference call, web conference, Skype®, etc.) is a viable option.

e. Mediation Panel Rules. If the parties are using a commercial panel to select a mediator, often the panel has specific mediation rules. Attorneys representing clients should be aware of any commercial panel rules for mediation that may apply (along with statutes and local court rules that may also be applicable). Attorneys may want to refer to specific commercial panel rules in contractual mediation clauses.

f. Payment of Fees. The parties should determine who will pay for the mediator, such as an equal division of fees or other arrangement.

g. Exclusions from Mediation. Contractual mediation clauses should include specific exclusions from mediation, if any, such as equitable remedies like an injunction, or particular claims that are not required or allowed to be submitted to mediation.

h. Tolling Statute of Limitations. The parties may want to include tolling language that will allow the parties to mediate without risking a loss of rights due to a statute of limitations. The parties may also consider excluding claims that would otherwise fail due to the inability to toll a statute of limitations.

i. Completion Time Frame. Mediation clauses in contacts often include a time frame for completion of the mediation session. If the matter is not submitted to mediation or

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completed within a particular time frame, the parties may proceed to arbitration or litigation, as applicable.

j. Consequences for Failing to Mediate. Mediation clauses can also include a loss of remedies for a party’s bad faith failure to mediate, such as the inability to recover attorneys’ fees and costs.

VIII. ELEMENTS OF A MEDIATION SESSION: BEFORE, DURING AND AFTER

Attorneys should be aware of events that occur before, during and after a mediation. Preparing for these events will assist the attorney in creating a foundation for a successful mediation session.

a. Before.

i. Pre-Mediation Call. The attorneys often communicate with the mediator prior to the session to discuss the main issues in dispute, the requirements for submitting mediation briefs (see below), creating an agenda, deciding who will attend and other important aspects of the mediation. The pre-mediation discussion helps to eliminate misunderstandings and problems, information gaps and unanticipated circumstances that may hamper the process. It also helps the mediator prepare and be informed of the issues prior to engaging in the session, to save time, use the session for actual discussion and negotiation and not mediator education, and so that the mediator can focus on the issues to assist in the settlement process. The mediator can discuss whether the parties can meet in a “joint session,” or if would be better, based on the relationship and personalities, that the parties be placed in separate rooms. The mediator can discuss whether an interpreter is needed, and if there are any cultural issues that may affect communications or negotiations.

ii. Agenda. Often the parties will set an agenda, listing the most important items of dispute, how they will be discussed and who will discuss them, who will attend and other important aspects of the mediation. An agenda helps keep the parties on track and focused on the issues that are most important and that if resolved, will lead to an acceptable resolution of the dispute.

iii. Mediation Briefs: the mediator will often require the parties to submit a mediation brief, stating the party’s position in the matter, the strengths and weakness of the party’s case, desired outcomes and other important information the mediator should know. A party can attach relevant materials such as the Complaint and Answer, contracts in issue, expert reports, testimony, relevant discovery and other materials for the mediator’s review. The mediation brief can be shared with the other party or may be for the mediator’s eyes only. A party can also create two versions, one for the mediator with information not shared with the other party, and one for the other party or parties in the matter.

b. During.

i. Joint Session vs. Caucus. When parties to a mediation meet together in the same room, this is called a “joint session.” The parties meet face to face and can speak

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directly to each other, or the attorney can speak for the party. Often this is the first time that a party has met the other party face to face. The parties and counsel can also meet separately with the mediator, called a “caucus.” This allows the party or counsel to speak with the mediator without being overheard by the other party, and to express information that a party is not yet ready to share with the other party. There is no single method as to how a mediation session may progress. The mediator may introduce the parties, then, depending on whether the parties will use a joint session or caucus, each party may present an introductory statement setting forth the facts and that party’s position. Sometimes the introduction may be done by the party’s attorney. The parties may exchange documents and information, then begin to address issues, state positions, negotiate issue by issue or make concessions, and present and discuss expert and witness statements. The parties may determine a range of settlement, if the settlement involves payment from one party to the other, with each party making an opening offer followed by counter offers until a settlement is reached.

ii. Sometimes a mediation will simply start with a party proposing a dollar figure, followed by counteroffers from each side until a final settlement figure is agreed upon.

iii. If the parties want to conduct the mediation solely by caucus, the mediator will meet with each side, ask questions, discuss options, evaluate positions, and carry information, offers and counter offers back and forth between parties until an agreement is finally reached, or the parties have determined that a settlement cannot be reached. Some of these activities will happen in joint sessions as well.

iv. Caucuses also work well when the parties do not get along, and a joint session may cause the parties to be aggressive and disrespectful. Caucuses also work well when counsel do not get along, and the negative relationship of counsel may hinder the settlement process. However, joint sessions often result in parties gaining information in a way that can’t be done by caucus, and they often help parties make better settlement decisions. Joint sessions are used less often in some jurisdictions, but should be considered as a valuable tool in resolving disputes.

v. “Mediator’s Proposal.” Sometimes the parties cannot reach an agreement during the mediation, or the negotiations have stalled. This is called an “impasse.” Each party has bargained as far as they are willing to go. The mediator can help break the impasse by suggesting a settlement option or dollar figure. The parties can decide to accept or not accept the mediator’s proposal. Sometimes each party advises the mediator in confidence whether they accepted or rejected the proposal, so that the other side is unware of the party’s decision. Often the mediator’s proposal is accepted, leading to a settlement.

vi. Settlement Agreements. In many jurisdictions, oral settlement agreements will not be enforced outside of mediation due to confidentiality restrictions. It is therefore important to make sure the parties sign a written settlement agreement before the mediation session has ended. Even if the attorneys plan to draft a more substantive settlement agreement, a short form agreement should be signed that can serve as

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the settlement agreement in case the long form is not executed for some reason. The settlement agreement in mediation should contain all the essential terms; the parties, settlement terms, release language, unknown claim waivers, if applicable, and language stating the agreement is enforceable in a court of law. Attorneys representing parties should check jurisdictional rules regarding the appropriate language for mediated settlement agreements so that they will be enforceable in court.

c. After.

i. If the parties agree to execute a long form settlement agreement after the mediation session has ended, the agreement should be executed as soon as possible. Again, a short form agreement should be executed by the parties before the mediation session ends to make sure that there is an enforceable agreement in case the long form agreement is not executed for some reason.

ii. If the matter has not settled, counsel and parties should continue to try to settle after the session, or consider scheduling another mediation session if additional information and materials are necessary before settlement terms can be discussed. Failing to settle during mediation is not always a bad thing. Sometimes the parties simply do not have enough information to make a well informed decision, and settling during mediation would result in a bad decision for one party or the other.

iii. If the matter does not settle in mediation, the parties should stay in contact with the mediator. Often the mediator can assist the parties with settling the dispute, even after the session has ended. Counsel should consider whether or not the discussions will be confidential or privileged, and act accordingly and in the best interest of the client with regard to those post-mediation discussions.

iv. If the matter has not settled, the parties may need to proceed to arbitration or litigation. Sometimes allowing a third party to make a decision is the only way the dispute will be resolved, and it is in the best interest of the client to take that route.

IX. TIPS FOR SUCCESSFUL MEDIATIONS

a. Prepare. The most successful mediations occur when the parties and counsel are prepared. The party should come to the mediation prepared to negotiate, and if appropriate make concessions in order to bring about a desired outcome. Each party should determine ahead of time what the party would be willing or not willing to accept, along with the information and materials necessary for the other party to consider in settlement.

b. Pre-Mediation Call with Mediator. When possible and appropriate, the parties and/or counsel for the parties should conduct a pre-mediation call with the mediator so that he or she understands the issues to be better prepared to assist the parties with settlement discussions. The agenda, participants, documents and materials to be presented, relationship and cultural issues, and other information can be determined during the pre-mediation call.

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c. Set an Agenda. Setting an agenda will help the parties focus on the important issues that need to be addressed and prepare for the discussion in order to achieve settlement. Setting an agenda will also help the parties determine the information and materials related to the agenda items that should be shared and exchanged during the session.

d. Manage Client Expectations. Many clients have no idea what to expect from a mediation session. Counsel should explain to the client the process of mediation, the amount of time that can be spent during a session, the amount of time a mediator can spend with one party or the other, the “hurry up and wait” that sometimes occurs during a mediation session, what to expect during the session and what can and can’t happen, possible outcomes, proposals that can be made, and the fact that the client is not required to settle if it is not in the best interest of the party to do so. This can set the client at ease and allow the client to think clearly and make good decisions during the mediation session. Counsel can also explain the different kinds of negotiation that may occur and offers and counteroffers traded back and forth, sometimes in very small increments. This will also help to avoid the situation where clients believe the other party will accept any offer the client may make, and help reduce anger and feelings of disrespect.

e. Remember Ethical Duties. Counsel should explain to the parties the duties required by mediation confidentiality, the effect of mediation privilege, and any exceptions in the relevant jurisdiction. This will help insured that counsel complies with any ethical duty to keep the client fully informed and help the client avoid unlawful disclosures that may lead to liability.

f. Know the Confidentiality and Privilege Rules. Counsel should be aware of the jurisdiction’s confidentiality and privilege rules in order to strategize for contract drafting purposes, and to make good decisions as to what will or what will not be disclosed during the mediation session.

g. Consider Creative Settlement Options. Parties and counsel should consider non-traditional settlement options during the mediation. By determining each party’s “interests” rather than “position,” options can be considered for settlement that may or may not be available in litigation or arbitration.

h. Work on Boilerplate Settlement Terms Ahead of Time. Attorneys should consider working with opposing counsel to draft the boilerplate clauses of the settlement agreement prior to the mediation session. This will create the spirit of cooperation between counsel, and help the parties focus on the important issues for mediation. It will also reduce the amount of time drafting the settlement agreement during the mediation session.

i. Don’t Fear the “Joint Session.” In some jurisdictions, the majority of the mediation is conducted by caucus rather than joint session, out of fear that the session my lead to angry outbursts or revelation of facts or position the attorney may not want to the client to hear. But the joint session can often lead to each party being able to conduct a better analysis of the party’s position and the truthfulness of statements by hearing and seeing the other party make them directly, and an assessment of a party’s non-verbal communication, such as body language. Counsel and parties should consider the joint session as a valuable tool to assist in settlement.

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j. Negotiate, Don’t Litigate. Mediation is a unique opportunity for the parties to negotiate confidentially and in good faith. Counsel should avoid the temptation to “litigate” the mediation, as it may hamper the ability to settle the matter. This is not to say that counsel should not vigorously advocate for the represented party during mediation or use strategic threats where appropriate, but the advocacy should involve strong negotiation, not litigation tactics.

k. Know How to Calculate Damages. Very often the settlement of a disputed matter will involve a determination of how much money one party will pay to the other. Counsel should be very familiar of how to calculate the potential damages, as the settlement may turn on whether or not and how much damages would actually be available in litigation, and can be a persuasive settlement tool.

l. Take a Break If Needed. If the mediation is becoming heated, have the parties take a break, get some water, stop for lunch or take a walk. Sometimes a short break from the negotiations is needed to recharge the parties and get the negotiations back on track.

m. Sometimes, the Problem is the Attorney. Sometimes a matter will have difficulty settling due to the personality, lack of preparation, inexperience with mediation, or other issue involving a party’s lawyer. Make sure that as counsel, you are not impeding your client’s ability to settle the matter.

Mediation can be a great method of resolving legal disputes in a confidential, efficient, cost efficient manner. An attorney should be educated (and should educate their clients) on the mediation process, confidentiality obligations, differences between state and federal courts and other matters relevant to mediation. By doing so, an attorney will help ensure that the process is a successful experience for the client.

i See United States District Court, Central District of California’s Rule 16-15. ii See for example, United States District Court, Southern District of New York’s “Procedures of the Mediation Program” dated December 9,

2013. iii See for example, Rule 8.1 of the Alternative Dispute Resolution Program Rules for the Superior, State, Probate, Magistrate & Juvenile Courts

of Fulton County, Georgia. iv See for example, Utah’s Uniform Mediation Act, Rule 78B-10-104. v See Wilcox v. Arpaio, 2014 WL 2442531 (9th Cir. 2014). vi See for example, California Evidence Code Sections 1115-1128. vii Washington, Idaho, Utah, South Dakota, Nebraska, Iowa, Illinois, Ohio, Vermont, New Jersey, Hawaii and the District of Columbia have

adopted the Uniform Mediation Act. See, National Conference Commissioners on Uniform State Laws, Uniform Mediation Act, http://www.uniformlaws.org/shared/docs/mediation/uma_final_03.pdf. viii “Mediation communications” is defined by the Uniform Mediation Act as a statement, whether oral or in a record or verbal or nonverbal,

that occurs during a mediation or is made for purposes of considering, conducting, participating in, initiating, continuing, or reconvening a mediation or retaining a mediator. See Section 2(2) of the Uniform Mediation Act. ix See Uniform Mediation Act, Section 4. x Id. xi See 28 U.S.C. 651, et. seq. xii 28 U.S.C. 652(d). xiii See for example, United States District Court, Central District of California’s Local Rule 16-15; United States District Court, Middle District of

Tennessee’s Local Rule 16.08; and United States District, Southern District of York’s Local Rule 83.9 and “Procedures of the Mediation Program” dated December 9, 2013.

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xiv See Folb v. Motion Picture Indus. Pension & Health Plans, 16 F. Supp. 2d 1164 (C.D. Cal. 1998), aff’d, 216 F.3d 1082 (9th Cir. 2000) (Central

District of California’s adoption of a federal common law mediation privilege); Sheldone v. Pa. Tpk. Comm’n, 104 F. Supp. 2d 511 (W.D. Pa. 2000) (Western District of Pennsylvania’s federal mediation privilege). xv See, Babasa v. LensCrafters, Inc., 498 F.3d 972 (9th Cir. 2007)(on an issue decided under federal law, state law on mediation and privilege

does not apply. The court declined to recognize a federal mediation privilege); and Facebook, Inc. v. Pacific Northwest Software, Inc., 640 F.3d 1034 (9th Cir. 2011), court declined to adopt a federal mediation privilege, and stated that that federal privileges are created by common law and it was doubtful district courts could create a federal privilege by local rule. The court also questioned its existence in district courts that established a privilege); Kimberly-Clark Worldwide v. First-Quality Baby Products, No. 2011-1157 (Fed. Cir. 2011)(Federal Circuit declined to recognize a federal mediation privilege); and Wilcox v. Arpaio, 753 F.3d 852 (9th Cir. 2014)(federal courts don’t apply state statutory mediation privilege when a federal issue is decided).