Lee Jay Berman's EYE ON CONFLICT

I approached SCMA with the idea of doing a Town Hall in 2003 when the mediation community was divided like the red sea over the Rojas v. Superior Court Case.  That case pitted the confidentiality of the mediation process (and the evidence of mold discovered during a mediation, and its eventual remediation) against the needs of the families who had mold spores in their lungs and no way to prove liability, short of breaking the confidentiality of the underlying mediation.  That year, SCMA and CDRC, the two largest mediation groups in California wrote opposing amicus briefs to the State Supreme Court.  As a commercial mediator, I could see both sides of the issue having merit and thought that the best thing for the mediation community to do was to practice what they preach and come together to have a facilitated dialogue about the issue of the extent to which mediation confidentiality should extend.  After leading two years of public hearings on the state Senate Bill regarding mediator credentialing during the mid-90’s, I was very comfortable leading this kind of discussion and thought it would be good for everyone.  Since that time, SCMA has hosted a Town Hall most every summer.

This year, the reported closing of the Los Angeles Superior Court’s ADR program is a huge issue in the legal and ADR world, so a Town Hall style dialogue among mediators and advocates alike is really important.  The LASC mediation program was the largest in the world, and by administering some 25,000 mediations per year, was the envy of most other legal communities.  One of the largest benefits that the program provided, in addition to the obvious docket clearing benefit of a 50% resolution rate, was that it took the pressure off of counsel to risk appearing weak if they suggested mediation to opposing counsel by having the court order cases into the program so that counsel could save face.  One can only wonder how many of the cases that would actually benefit from a good private mediation will have that opportunity, as trial counsel simultaneously need to be zealous advocates for their clients in an adversarial proceeding.  I believe that proposing a mediation – an attempt to settle – is one of the hardest things to do for a trial lawyer. And the more their style leans toward intimidating, the harder it is for them to be congenial or appear open to settlement.

The reason that the local mediation community is divided over this is that at different stages in a mediator’s career, the program can be really helpful, almost a saving grace, or it can be the evil, undermining effect that keeps them from making a living.  You see, the LASC mediation program operated with a collection of some 2,000 trained mediators willing to mediate cases under $50,000 for the court on a volunteer basis for the first three hours.  The problem was that the court never respected the $50,000 cut-off intended by the original deal, which became SB 401, and eventually CCP 1775. As a result, the court deemed it fair game that ALL general civil cases were eligible for “free” mediation (for the first two hours of mediation time in every case, which quickly morphed into 3 hours by the late 1990’s).  This meant that for beginning mediators who were fresh out of training, the court was a great place to go and volunteer and get experience mediating with represented parties.  For intermediate level mediators, it was a great opportunity, and still one worth volunteering for, to raise their number of cases mediated and begin to develop relationships with trial lawyers on both sides of the aisle, as well as institutional parties, like insurance companies and corporate counsel.  But for more advanced mediators, looking to build a practice and pay the mortgage and feed their families, the court program soon became unfair competition, building on the backs of volunteer mediators, and by sending cases over $50,000 into this free program, potentially taking cases that would otherwise go to the private sector into the court’s jurisdiction by offering them free mediation. Today’s Tea Party should have had a fit over this.

As we look at it today, the possibility that this program appears to be going away on June 30, the only certainties we have is that the legal and ADR communities likely won’t have the court’s help in getting parties to the mediation table, and the likelihood of finding volunteer mediators for litigated cases will be little or none.  What we won’t know until this evening at the Town Hall being hosted by the Southern California Mediation Association is how the mediators and the bar will react to these changes.  Undoubtedly, some mediators will applaud them and say it’s about time, where others will mourn them and say that they feel like the mediators who are “in” practice already will have an even greater advantage over those trying to break into the profession.

In the end, I look forward to moderating a civil and productive dialogue will help generate creative ideas for continuing to promote mediation in litigated matters, and that as a community of peacemakers, we will find a way to serve those cases that might otherwise go un-served.  As a room full of mediators, I am certain we will find a way.

Tags: ADR, civil, Closing, litigation, Los Angeles, Mediation, Superior Court
Posted in Mediation Field | 3 Comments »

Pink Floyd is suing its former record label EMI over how royalties are calculated on internet sales.  Among other things, the band is contesting whether its 1999 contract allows sales of individual tracks, as EMI contends, or mandates only complete album sales, which is how Pink Floyd interprets the contract.  “When Pink Floyd’s latest contract was crafted in 1999, iTunes didn’t even exist,” EMI attorney Elizabeth Jones sums up the label’s argument.  “Pink Floyd, EMI Brawl Over iTunes Royalties”.

Almost all contracts are ambiguous, and parties whose incentives cause them to interpret contract terms in their own favor will disagree about almost any contract.  Even the greatest transactional attorneys in the world can’t account for every contingency or every evolution of technology, biology or ecology.  This is why courts look at the intent of the contract.

Mediators bring disputing parties back to the contract’s original intent.  Really good mediators can bring parties all the way back to their relationship at the time of the agreement and the reasons behind their decision to do business together.  It’s not unlike reminding a divorcing couple about their courtship and their wedding to allow them to remember they didn’t always feel animosity toward each other.

In 1999, EMI no doubt courted Pink Floyd for its business.  Pink Floyd signed with EMI, even though the band likely had its pick of record label suitors.  Both of them would do well to remember their original motives and intentions that drove their choices.  In that light, they can view the disputed agreement (I find it ironic that people often fight over something called an “agreement”) with a less extreme interpretation, and each other as something less than the devil incarnate.

Ken Cloke wrote in his book Conflict Revolution that most people have to reduce the other to evil to sustain a fight at the high conflict or heavy litigation level.  Revisiting intent surrounding the original agreement can be a step toward humanizing the conflict.

In reality, these two entities (they are both businesses, after all) will necessarily have a long-term relationship for as long as EMI owns the Pink Floyd catalog.  What that means from a negotiation standpoint is that they can remain in a competitive state, they can settle the lawsuit with a compromise where each walks away still angry because they are anchored to their loss, or they can mediate collaboratively to a satisfactory resolution for both parties, thereby preserving their relationship.

Successful mediation in this case will require three elements:

1.)    Good lawyers capable of seeing the lawsuit as more than right or wrong litigation.  With all due respect to strict litigators, a creative deal-making lawyer at the mediation table is often helpful because transactional lawyers typically view negotiation very differently than a straight trial lawyer;

2.)    The right parties in the room.  We mediators are always making noise about why having all decision-makers in the room is important.  To have any kind of creative discussions, it’s required.

3.)    A mediator who can steer the discussion (often repeatedly) from destruction to a constructive business meeting where the parties explore all options.

For example, options in the Pink Floyd/EMI conflict could include exploring Pink Floyd buying back its catalog or allowing single-sales from all albums except the two top sellers, The Dark Side of the Moon and The Wall.  A monetary settlement amount could be funded with something other than cash, such as EMI stock, which would give Pink Floyd a greater stake in the label’s success and direction.  These conversations and other brainstorming around these issues can only take place when the table is set in a way that allows them to flourish.

Most settlement discussions in similar cases start with a sky-high demand and a nuisance-value offer, if any.  Where it goes from there depends on the lawyers and the mediator.  But contract disputes have the potential of becoming much more than just a compromise around the dollars.

Pink Floyd’s lawyer wants a finding determining what the contract says.  If every contract in the industry was written the same and a court ruling would set precedent, perhaps litigation is necessary.  But in the case of this unique contract, I submit that it’s not a verdict that is needed as much as a few creative minds.

Tags: Collaborative, Competitive, Compromise, conflict, Conflict Revolution, Dark Side of the Moon, EMI, entertainment, iTunes, Ken Cloke, Lee Jay Berman, Los Angeles, Mediation, Mediator, music, music business, Pink Floyd, record label, royalties, The Wall
Posted in Celebrities, Entertainment & Sports | 5 Comments »