Diversity and Mediation

Hon. Ariel E. Belen (Ret.)

Hon. Ariel E. Belen (Ret.)

Imagine two parties locked in a bitter and acrimonious dispute that has gone through six years of hotly contested litigation. At issue are the ownership and control of at least a dozen commercial and residential properties valued in the tens of millions of dollars.

The litigants in this case were associated for nearly 40 years and had built up this large real estate enterprise from scratch. Unfortunately, they had a major and seemingly irreparable falling out and were no closer to resolving this case than they had been at its commencement. One of the litigants was a Latino immigrant, who felt deeply wronged by his former partner.

It is an axiom of mediation that emotional forces can disrupt communication and produce non-productive, if not outright irrational, decision-making. Although the broad outlines of the settlement should have been apparent to both sides for a long time, what was missing was the ability of a mediator to get beyond the parties’ huge emotional investment. What altered the negotiations was that the mediator almost always spoke in Spanish with this litigant and always listened very carefully to what he said and to what he did not say. This settlement, however, would be a rarity in today’s world of ADR because of the scarcity of Latino ADR practitioners in the United States.

Familiarity with cultural nuances, fluency in a language and diverse life experiences can be tremendously beneficial in the resolution of a dispute. A neutral who has these qualities may be much better suited to facilitate the disposition of a case precisely because so much of what drives litigation has to do with hidden agendas and personal idiosyncrasies. It has been said that “[a] mediator’s ability to navigate the cultural differences across disputing parties is paramount for success of dispute resolution …cultural competence is an essential skill in a mediator’s tool-kit… Cultural competence is a central skill a mediator must master.” These skills most come to bear during the private caucus sessions where a mediator in a confidential setting tries to gain the trust of a litigant.

Unfortunately, even as the United States becomes more and more diverse, there is a dearth of professional mediators from minority backgrounds. There are few statistics available, but most ADR providers mirror those from the federal bench, partner ranks in Global 100 Law Firms, C-suite and general counsel ranks of Fortune 100 companies.

In 2016, according to the ABA Women in the Law reported that 21.5 percent of the partners in those firms responding were women. In the courts, 33 percent of federal judges are women. In the Associate Ethnicity section of the 2016 NLJ 250/Am Law 200 Survey, Asian-Americans constituted 6.67 percent of lawyers at Am Law 200 and NLJ 250 firms; Latinos, 3.48 percent; African-Americans, 3.0 percent; self-described multiracial attorneys 1.69 percent; and Native Americans or Alaska natives, 0.18 percent.

Ironically, although large corporations have seen the value in diversifying their workforces, management and law departments, when these same corporations are considering or actually engage in litigation, their selection of diverse neutrals to mediate these disputes is often hampered by the lack of minority ADR practitioners. Like the lack of women ADR practitioners, this phenomenon is mainly attributable to what has been called both “supply side and demand side obstacles.”

The question then becomes how can corporations and corporate legal departments achieve greater diversity in their selection of ADR practitioners? To begin with, corporations could encourage their outside counsel both to diversify internally and to make a determined effort to hire more diverse neutrals when they decide to pursue ADR. This “encouragement” should come from the C-level because experience has demonstrated that the most successful corporate inclusion and diversity campaigns are those that are implemented with the full knowledge and support of C-level management.

Outside law firms that want to support a company’s diversity efforts could also independently seek out and utilize qualified minority neutrals outside their traditional network. Finally, ADR providers themselves could continue to focus on the recruitment and development of minority neutrals and promote them with the corporations and outside counsel who routinely use the providers’ services.

Of course, this is both a laudable goal and a highly practical one because diversity in mediation is not just good from a public relations standpoint, but it also contributes mightily to the early and inexpensive resolution of corporate litigation.

An Emerging Structure of ADR in Mass Torts and MDLs

The official statistics provided by the Judicial Panel on Multidistrict Litigation in recent years count Products Liability as nearly one quarter of all pending multidistrict litigations (MDLs), making it the largest category among all classifications.

Many of these Product Liability MDLs, especially pharmaceutical and medical device mass torts, continue to dominate headlines in mainstream and legal media. These mega cases dominate and potentially drain the resources of the courts, counsel and parties to the litigation. The magnitude of these matters, combined with the statistical likelihood of eventual settlement in nearly all of them requires focus on trends that facilitate resolution.

ADR has a longstanding role in resolving some of the largest and most high-profile matters. As with any evolving industry, ADR models were developed to streamline processes for the efficient resolution of disputes. This is certainly true within the context of mass torts, where a cooperative, working model has emerged because all stakeholders buy into its effectiveness.

With increasing frequency, defendants are creating settlement teams separate from trial teams, sometimes very early in the litigation. Plaintiffs are exercising the same strategy with the formation of Plaintiffs’ Steering Committees. Both teams consist of individuals with earned reputations as effective negotiators. Simply put, these teams work with the judges, magistrate judges, mediators, and special masters to form a cohesive settlement process.

A parallel evolution is also occurring on the special master side. Historically MDLs often utilized a discovery special master, but the emerging trend is the additional designation of a “settlement special master.” Whether appointed by the court or selected through agreement of counsel, this role is becoming the analog of the plaintiff and defense settlement teams.  For example, in the Gadolinium Contrast Dyes Product Liability Litigation MDL, the Hon. Dan Polster, Northern District of Ohio, appointed Cathy Yanni as Settlement Special Master.  According to Yanni, “[w]orking as the Settlement Special Master, I was able to negotiate settlements with the assistance of the court and had the authority to work independently with the parties and counsel to settle groups of cases as well as individual cases.”

Given the scope and size of mass tort actions and the incredible burden on all involved, the utilization of improved ADR methodologies—including the use of settlement special masters— is a practical and valuable consideration for all practitioners.

Resolving Complex Environmental Disputes

Lester Levy, JAMS mediator and arbitrator

Lester Levy, JAMS mediator and arbitrator

This article discusses early cooperation between parties and insurers in resolving complex environmental disputes. It summarizes strategies that recently succeeded in a six-way dispute over the costs of investigating and remediating an extended plume of PCP groundwater contamination. It moved rapidly from a traditional lawsuit to a voluntary mediation process aimed at identifying the most economical and reliable remedial approach to cleaning up the contamination, and allocating the costs of doing so among all parties. Although the parties agreed to refrain from traditional court-mandated procedures, they retained the right to try the case if the cooperative process was unsuccessful in resolving all disputed issues. Ultimately the process was successful and the need for trial was eliminated. Continue reading

My Class Action Checklist

Hon. Morton Denlow (Ret.)

Hon. Morton Denlow (Ret.)

For a number of years now, I have enjoyed successfully resolving complex class action matters. The cases are challenging, the counsel astute and the results rewarding.

I developed a class action checklist designed to assist my clients in thinking through the issues necessary to settle their class action case. The use of this checklist and the process it requests of counsel has allowed me to expedite the settlement of class action matters. Continue reading