Settlement Perspectives

Thoughts on how to resolve disputes and get your deal done.

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6 PerspectivesAugust 29, 2008

Why Are We Here?

A few years ago I had a case in Chicago bankruptcy court that needed to settle. In another post we can talk about why it needed to settle, why it didn’t, and the trial that ultimately resolved the case, but something I noticed as I tried to settle that dispute drove my desire to start this blog.

A Cold Meeting in Chicago

As so many do, my case hit that awkward pause between the production of documents and the first deposition. My team and I had done an early case assessment and we knew our opponent’s case had real problems, but we weren’t sure the plaintiff understood how difficult his case would be. As the holidays approached and before the other side invested any more in the case, I reached out to propose a face-to-face meeting to discuss the potential for settlement. Armed with my comprehensive presentation on the three reasons why the plaintiff couldn’t win, I asked Simon Fleischmann, then a young associate at my outside firm, to go with me.

How Do You Learn to Settle Cases?

On the walk home from the meeting Simon and I discussed what had happened and why each side might have reacted the way they did. I soon realized that, while his firm was better at training than most, today’s associates don’t make it to these meetings very often. I began to wonder — how do new lawyers learn to settle cases now?

Today’s associates have to work harder than ever to develop their negotiation skills. When I began my career in 1990, the partners I worked for asked me to sit in on speakerphone-moderated settlement conferences, to attend face-to-face settlement meetings, and to participate in mediations (a relatively unproven concept at the time). I was lucky, even then. Today, younger lawyers — and their clients — live with the results of others’ settlement discussions, but their participation is second hand if they get to participate at all. Cell phone settlement talks and email “conversations” by definition exclude the rest of the team from real-time involvement in resolving disputes. While today’s motivated young lawyers have to learn how and why the discussions unfolded the way they did after the fact, I believe additional perspectives on the settlement process can only help.

There Is No Single Right Answer, and I Won’t Give You One

What’s the best way to settle disputes? Everyone has experience negotiating, but few are truly comfortable doing it. Why is that? It may be because there is no “right” way to get a case settled, but there are lots of wrong ones. Over the years I have seen plenty of strategies and tactics that got cases settled, and unfortunately, quite a few that made matters worse.

A few years ago Robert Manley of my old firm and I gave a talk to a Dallas young lawyers’ group on “Negotiation: Ten Things to Think About — A Non-Exhaustive List.” We made a commitment then that I will make here. I don’t have an exhaustive list of right answers, and I won’t pretend to give you one. What I will do is let you know what has worked for me in 18-plus years of settling cases all over the United States and around the world. I’ll give you some non-exhaustive lists of things to think about when an opportunity to negotiate comes your way. And I’ll help you recognize when that is.

Where I’m Coming From

Everyone has biases, and I want to be open about mine. My biases come from my experiences managing litigation for two public companies and practicing in two great law firms, including a complex litigation boutique and a larger firm that cared about training its young lawyers.

As I write this post I serve as the General Counsel/Contracts, Litigation and Risk at a “Big Four” consulting firm. It’s a post I’ve held in some form since 2000, and has global responsibilities for these and other areas that I manage through a fantastic team of more than 40 lawyers and support staff in 10 countries. While I have taught at the university level and am a trained mediator, my approach is neither academic nor mediation-centric. I don’t rule out simply sitting down to negotiate when it makes sense. To the extent it’s relevant, additional information on my background is available here. (Come to think of it, this is just one place where I should note that the comments in this blog are my individual thoughts and not necessarily those of my employer or anyone else.)

Like all in-house lawyers, my performance is measured in part by the amount I spend on litigation, but my approach to cost reduction has been less than traditional. Many clients seem to want to manage litigation costs by reducing hourly rates, which can certainly help, but it seems to me that the best way to spend less on litigation is to have less litigation. I know docket management isn’t easy and cases can be difficult to settle, but resolving litigation — early — can bring unnecessary fees and downside exposure to a close. Yes, some cases do go to trial, and settlement perspectives often come from knowledge of trial as the alternative. I have “heard the knock” as the jury announces its return and I am proud of the results; I have practiced in a trial firm and have seen the dramatic consequences of parties unready for it; and I have bet more than I would care to admit on an arbitration panel and lived to tell about it.

So while I am (almost) always looking for a way to resolve disputes responsibly and quickly, I have a strong bias toward exhaustive early case assessment, meticulous case preparation, and aggressive case prosecution unless and until settlement efforts are successful.

Where Do We Go from Here?

I recently sat in on a negotiation class at SMU Law School and realized how important it is for young lawyers to understand negotiation fundamentals. Thinking about how to build on that course, it seems that a place where lawyers and clients can find new, and sometimes different, perspectives on how to settle disputes can save everyone time, money and risk exposure. With your contributions and comments, I think settlementperspectives.com can serve that purpose.

Categories: Education,Negotiation,Settlement

6 Perspectives:

DR's Money ManagementTuesday, September 2, 2008 9:38 am

Since life is one long negotiation, at least as I see it, I’m looking foward to your future posts.

vickie pynchonThursday, September 11, 2008 11:42 pm

I am very excited to see someone with your experience and in your position blogging on negotiating settlements. I’ve been only semi-patiently waiting for precisely you to come and join the conversation! Can’t wait to hear more. And thanks for including me in your resources.

Nancy E. HudginsSaturday, September 13, 2008 11:17 am

Hi, John!
Welcome to the blogosphere! I have a bottle of champagne waiting for you over at http://www.civilnegotiation.com. I’m delighted you’ve joined our online conversation and I look forward to reading your posts. Thanks for including me in your resources. As a staunch proponent of the Rule of Reciprocity, I’ve added your new blog to my blogroll. Best,
Nancy

In-HouseInAustin — Sunday, September 14, 2008 8:54 pm

Regarding the law students and legal training on settlements, it is amazing to me how many more students participate in Moot Court & Mock Trial competitions than Negotiations. While a small percentage of students will become appellate or trial attorneys, almost every attorney is involved in some form of negotiation. I always tell the students when I’m judging them that no matter how they did in the competition, they are to be commended for participating and gaining experience in such an important area. The competition is not quite true to life because they are time constrained and frequently run out of time before they get anything accomplished. It is interesting in the debriefing session after when they tell me what their negotiation strategy entailed. That is potentially another topic for your site though. When in a mediation or structured negotiation, some thought needs to be put into timing. How much time to spend on one area, when to move on, what HAS to be accomplished in the time allotted, etc.

Chris AnnunziataTuesday, September 16, 2008 9:57 am

John:
I have already added your blog to my reader and look forward to your future posts.
Chris Annunziata

Mike MaslankaTuesday, September 16, 2008 4:01 pm

John,
Great blog. Welcome to blogging. I started one last month with Texas Lawyer , http://www.texaslawyer.com and click on Work Matters. Regards, Mike

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Settlement Perspectives
is the professional weblog
of John DeGroote.

I created this site to help clients and their counsel navigate the challenges that inevitably result from disputes, settlement efforts, impasse, and negotiation in general. The perspectives I bring are based on my experience, summarized in this abbreviated bio. If you have any questions or thoughts about this site, or an issue you’d like to see addressed, please email me at:

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