IN THE PROFESSION
“ in-person ” mediation , though they would precede and complement it . Take a look at them in summary , and then consider how they might be handled in the context of a specific case .
1 . Necessary Conditions / Requirements
For EDR to be successful , counsel for all parties must be on board , willing to engage in some early-information sharing , and then to conduct " principled negotiation ," a good-faith discussion based on openminded and sound assessment of the parties ’ respective claims . As you can imagine , accomplishing this information exchange smoothly requires a hands-on mediator , using many of the traditional tools of good mediation .
2 . Opening Assessment of Case Issues
Working with counsel , the EDR mediator then helps the parties crystallize what the key disputes are as to liability and damages , as well as to begin thinking early about some of the " intangible " and business / industry / decisionmaker interests that need to be addressed .
3 . Information Exchange
In helping the parties define the case issues , the EDR neutral will also work with them to identify the most critical questions and “ unknowns ” necessary for good case evaluation . One of the objections we hear sometimes to mediation is that " it is too early " and that discovery is needed first . EDR does not look to deploy early discovery , but it does look to surface for the benefit of the parties " sufficient information ," meaning the answers to questions each side has that will help them make good decisions and engage in principled negotiation .
4 . Objective Analysis and Valuation
EDR uses excellent techniques of decision analysis to help both sides better understand their own and their counterpart ' s risks and importantly , expected case value . Among many fascinating studies on cognitive bias , a famous one from Harvard Business School shows that negotiators with the same set of facts consistently overvalue their own positions as compared to others , with collective estimates of success landing in mathematically impossible ranges . EDR tools like decision trees , and probability analysis , combat these biases .
5 . Final Resolution
With the proper case valuation in hand , and intangibles and interests surfaced , the mediator then helps move forward a principled negotiation . That could mean resolution before the formal mediation session , but at a minimum , with an early dispute resolution process in place beforehand , the parties can bypass much of the positional bargaining and start a mediation session already well on the way to a deal .
To understand how EDR might work in a commercial dispute , we will take a case study in which you represent Ready to Grow LLC ( RTG ), a prospective franchisee for Tasty Ice , Inc . Your client loves the Tasty Ice recipe and process , a combination of shaved ice and ice cream , viewing it as the next big thing and a huge business opportunity . After several in-person meetings at Tasty Ice headquarters , and numerous emails about terms , your client has signed an agreement with Tasty Ice to open one unit . Your client borrows funds to start operations and is even ready to sign an amendment to open an additional four units , for which he tells you he had verbal approval from Tasty Ice .
Unfortunately , after finding what he views as a better business partner , the CEO of Tasty Ice tells your client ’ s owner the deal is off , leaving him high and dry . You get the call .
In a complaint carefully researched and prepared by you , RTG claims breach of contract , seeking $ 5,000,000 in damages : $ 500,000 per year , per unit , for two-year terms . You have solid financials , you think your client is likable , and you like the emails as collective evidence of an agreement , including on attaching a specific draft amendment that your client says was supposed to be signed .
How might this case play out ? On one hand , the parties could conduct extensive discoveries over an extended discovery period of eight months , and get well into pretrial preparations , with nearly $ 400,000 in legal fees per side , each owner telling their lawyers they do not see an end in sight . Both owners are angry , each wants their fees , and each could not think less of the other side ’ s case . When mediation is scheduled , either ordered by the court , or because one lawyer or the other reticently mentions the subject of mediation , the mediator has their work cut out for them .
The parties then show up , spending four hours of the day laying out their best-case arguments . Tasty Ice ’ s counsel assures the mediator that it will be adding a counterclaim soon . Both lawyers complain that the other side has not provided enough information , and after all of the rhetoric , start exchanging numbers that are initially millions of dollars apart . A skilled mediator , assuming there is time after this positional bargaining , may start to get to a realistic range near the end of the day . The client in one room then starts rumbling about walking out .
Perhaps this case gets settled late in the day , but not without additional difficulty and not without some residual mistrust by each client , along with the feeling that stones were left unturned to their detriment .
On the other hand , an EDR approach , the work could begin much earlier in the case . Since contracts with mediation requirements are still relatively uncommon , much less ones specifying the use of EDR procedures , as the lawyer in the case , you are familiar with EDR . You call your opposing counsel , suggesting and getting buy-in from him to bring EDR neutral . The incentive for both lawyers , and for their clients , is that they know they could save costs , and they know , if they work through the process in good faith , they will both immediately begin to get information to help better understand the key issues .
Here , your EDR neutral could get your client to supply not only the key deal-confirming email it will rely on , but the text messages and voicemail it saved from Tasty Ice ’ s CEO . On its side , Tasty Ice can supply financials for comparable units , to permit the parties to realistically understand potential lost profit . Importantly , this information can be shared confidentially ,
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