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Dispute Resolution Society – Competition Winners. Part III – Mediation Round

We had a break for lunch, so we grabbed some of the provided sandwiches and dashed back to the hotel to prep for the mediation round that afternoon. We knew this was our weakest area of expertise as all three of us had mediator qualifications, but none of us had ever been an advocate at the mediation table. Sadly, even if we had been the best advocates in NYC, fate was not with us in this round.

When we came into the mediator room, we quickly noticed a problem. Whoever set up the room had set it up with the mediator at the end of the table so he was facing the judges. This meant we were talking away from the judges for the entire round and in a room with a loud air-vent. But our mediation training reminded us that you never touch a mediator’s room. The mediator is supposed to be in a position of perceived authority. Maybe we should have pretended that we didn’t know that mediation is simply facilitated negotiation.

The settlement counsel for the other team came in. She was a sweet, round-faced, third year. We chatted a little and thought very highly of her friendly nature. The rest of her team arrived, and we sat down to the mediation table. The teams took turns moving out of the room as our settlement counsels described the team strategies. Hannah, our mediation settlement counsel, was very uncomfortable. One of the strategies that Hannah had to explain for this round was how we were going to use the mediator. While describing how we are going to use the mediator and enumerating the ways we would change our strategy based on whether the mediator was more hands-on versus more hands-off, the mediator was sitting in the room! Hannah tried very hard not to look at our real FINRA mediator when she was describing the work ahead of us to the judges.  After the strategy conferences, both teams entered the room and we sat at the table.

Laura was an attorney again for this round, and I played the client. I sat next to the mediator, and across from opposing counsel. Laura sat across from the petitioner.  It was interesting how the mediation began. The mediator was very hands on, so there was never a long moment when either team could feel “in control” of the round. He was an excellent facilitator. He allowed the petitioner’s counsel to speak first, and her voice and hands shook terribly the entire time. She was obviously nervous throughout the entire round. He “client” didn’t talk almost at all. Honestly, he looked bored. For most of the round, he starred at the ceiling with his Adam’s apple sticking out at us because he decided to lean his head back loosely, rubber chicken like, on his shoulders. I couldn’t figure out if this was part of their strategy or if the student playing their client was just lazy and the team was depending entirely on their pretend counsel. It looked like laziness or maybe he didn’t comprehend what a mediation was suppose to be.

The mediator was great, and I had really been a client at a mediation, I’d request this FINRA specialist. He quickly established why we were there, had the sides tell their stories, and unraveled the areas where we agreed. He always focused on the moments of agreement. Even towards the end of the round when it was clear we were not going to come to a reasonable settlement number within the time frame, he kept breaking every little thing into room for agreement, even the fact that we agreed that the numbers on the table were not numbers we could both agree to. It was very interesting watching this expert.

Twenty minutes from the end of the round, the chicken-neck client from the other team finally spoke. In about two sentences he emphasized that his position at the mediation was to get all his money back. He didn’t care how or have a reason why he wanted the money except that me, the client at the time, had lost his money, and he deserved to get it back. The trouble with this pretend position: there is no interest behind the position. Mediation is a facilitated negotiation, meaning there is room for negotiation. There is room for the parties to negotiate the settlement damages up or down from the starting point. Although the reward is still money, the usual reasons to go to negotiation or mediation is to keep it out of the courtroom, or to keep it as “friendly” as possible because there are interests on both sides to maintain some form of relationship.

A securities dispute like ours cannot go to court, so there is very little incentive to lower costs by settling rather than going to court. At most this sort of case can go to a FINRA arbitration panel which would not know whether the parties tried to negotiate first. Therefore, the negotiation or mediation steps are party-initiated. The parties do not have to be there. Obviously for the competition we had to go through these steps and try to settle, but this team was clearly not trying to settle! They had it in their minds that because we were already going to arbitration per our third round, they shouldn’t even try to develop their interests behind their positions in the mediation round. After his short statement, the opposing client went further to say he didn’t even think he was suppose to talk at the mediation. I am still not sure if this team understood what the point of mediation is. In any event, their disposition was not the only factor that ruined the round.

It was difficult to sit through the judges’ comments. Hannah watched the judges and the mediation from the sidelines and watched two of the judges fall asleep during the round. This was more evident to every alert person in the room when one judge accused us of not bringing up a very important topic which we had put on the table and we had discussed for some minutes. Another judge told us we should have moved the mediator’s chair so the mediator’s back was to the judges, but we would then be projecting our voices toward the judges. Thankfully, another judge said we were correct not to do this, as you never touch the room which is set up ahead of time by the mediator. The judge who told us “to take more control” and rearrange the mediator’s room did not understand mediation and had not even read the fact pattern for the competition, which was made extremely clear when he told our team that we should have expected the other team to ask us for $170,000! The claim made by the opposing client, per the fact pattern, was only for $160,000, and you do not ask for more money after you file the claim (at least, not in a competition setting). The other judges corrected him again and pointed out that we would never expect opposing counsel to ask for more money than the claim has stated when we are at mediation. Mediation is not suppose to be adversarial.

We did receive some good advice. Remember, I talked often in the mediation round. This was because our position was to get the settlement down really low, but we were playing off the fact that I was still the opposing client’s neighbor and the money that was lost in the securities investment had been for the opposing client’s kids’ college funds. When he told us his position had no more interest than to get his money back, this was completely adverse to the fact pattern. But, he didn’t even let us know this until the end of the mediation round. One judge told us if the other client is not talking, assume he is taciturn for an angry purpose, and the advocate for the other side (i.e. Laura), should become the only voice for our side. If the advocate on one side is the only person talking for that side, then the counsel for the other side should be the only one talking. It’s an interesting rule, especially when I was playing the concerned neighbor, but it does make sense to let the lawyers “duke it out” when one client does not wish to speak to the other client. The judge said this common strategy prevents the other side’s lawyer from directing all comments at your unwitting client. If the client continues to talk, it undermines the authority of her attorney, so the opposing counsel will ignore the other attorney.

The mediation was our low point. There is nothing you can do when the judges don’t understand the round, the other team doesn’t understand the round, and two of three judges fall asleep during the round. We treated it as a learning experience.  After the round, the other team tried very hard to stay far away from us for the rest of the competition. I can honestly say the majority portion of this team was not only unfriendly, but likewise unprofessional. My team tried to talk to them after the round to show camaraderie (it is only a competition) and learn more through talking, and we tried again during the evening mixer, but they would not even meet our eyes. Nothing can be done about this, just as you cannot argue with a judge when s/he is critiquing you. You must grin and ignore it, and move onto the next task.

Our next task was to practice and memorize specific phrases for the next day’s arbitration round and try to get a good night’s sleep. The good night’s sleep was difficult with so much to do, but even with only a few hours under our belts, the college football game that night kept many of the other teams out at the NYC bars. A tactical advantage? Maybe. We were just upholding our end of the bargain for VLS sending us to New York: we practiced, prepped, and slept.


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