The other day, I found a new online magazine in my e-mail box. It was the very first edition, Vol. 1, No. 1 (October 2011) of ADR Times Perspectives on Dispute Resolution.According to the message from the Editor – Ms. Mikita Weaver – this publication started out as an interactive blog, gradually shifting to this very first edition of ADR Times.com covering negotiation, mediation, arbitration, diplomacy and peace.

            Reading the publication, I found that many of the articles covered the fundamentals rather than the arcane. For example, Scott Van Soye discussed “The Negotiation Dance: Five Reasons Not to Sit Out” (at pp. 4-5). I have been in many mediations where counsel wanted to speed up the “dance.” Often, my response is that you can’t; if you do try – you will lose that magical something in the process of “dancing” and the negotiations will fail. Mr. Van Soye puts it more concretely, providing five reasons why the parties must dance!

            The first reason, as identified by Professor Peter Robinson (co-director of the Strauss Institute for Dispute Resolution at Pepperdine Law School) is that most agreements are reached at about the midpoint between the first two reasonable offers. To get to this midpoint, social pressure is placed on each party to share the burden of conceding. “Without a pattern of concessions, sometimes called the “negotiation dance”, this mutual pressure is gone.” (Id. at p. 5).

            The second reason is because it is normal to negotiate; “. . .failing to negotiate leaves your counterpart frustrated, angry that you are being “stubborn” or “unfair” and doubtful that you are really at your bottom line.” (Id. at p. 5). Consequently, without the “dance”, even the best deal may not be acceptable.

            The third reason is that a “take or leave it” approach greatly limits your ability to negotiate as well as  your credibility. If your first proposal is your bottom line, if it is not accepted – you must walk away to maintain credibility. If, instead, you offer something else, your credibility is gone.

            The fourth reason is that the “pattern of the dance significantly impacts the ultimate amount agreed upon.” Studies show that the first move in a negotiation strongly influences the other party’s estimate of value. (Id. at p. 5). By anchoring your first demand at a higher (lower), but reasonable amount, the agreement ultimately agreed upon will be higher (or lower). By being the first to make the proposal, you can set the level (or playing field) of expectation.

            The fifth reason involves “the value of aspirations or optimistic goals.” (Id. at p. 5). “Those with high hopes routinely do better than those with more “realistic” ones. Of course, this assumes that the demands are within the realm of possibility. Ridiculous demands will be ignored. (Id.)

            In sum, if you refuse to “dance”, you will definitely be at a disadvantage in any negotiation. You must “dance” to get the most out of the negotiation: it is that plain and simple.

            . . . Just something to think about!

            Routinely, most local rules of court require that persons with the ultimate authority to settle a matter be physically present at a court settlement conference or mediation. While it does not take much thought to understand the rationale behind this requirement, it may take a bit more thought to appreciate the consequences of not honoring it. I mediated the consequences of not abiding by this requirement the other day.

            It was an employment dispute. Present at the mediation were; (1) the attorney for the defendant; (2) the attorney for plaintiff; and (3) the plaintiff. Both counsel were young associate attorneys, practicing law for less than three years. Both had partners at their respective law firms to whom they answered and who were monitoring the negotiations during the mediation. Further, no representative of the corporate defendant was personally present; I was told the representative was available by telephone.

            After discussing the facts and issues of the case for a little while, the plaintiff’s attorney  conveyed his initial demand to me. However, it was approximately more than twice as much as his previous demand to defense counsel. (For example, if plaintiff’s previous demand was $20, his new demand was $50). When I tried to warn him that this strategy would not go over well, he resisted, insisting I convey it.

            I did, and it was not at all well received. Defense counsel refused to make a counteroffer. So, I held a joint session with both counsel in an attempt to discuss “real” amounts. Slowly, it came to light that plaintiff’s counsel was negotiating as he was instructed to do so by the partner back in the office and was only able to accept a certain amount if it was within a certain range. However, the defense attorney believed that range to be unrealistically high and had already rejected what his client believed to be an excessive demand. Nevertheless, defense counsel had been instructed to keep within that range (even though previously rejected.)

            When I attempted to discuss damages in terms of hypotheticals (e.g. if defense counsel is able to obtain authority to offer $30, will plaintiff accept it?), I quickly found that this tactic was fruitless. Since the amounts were not within the range given to plaintiff’s attorney by his boss, he could make no commitment. Instead, he wanted defense counsel to make a firm offer that he could then discuss with his boss by telephone. However, defense counsel did not “want to go out on a limb” to obtain this increased authority, if it was not going to be ultimately accepted by plaintiff. Each was waiting for the other to make a firm commitment that they could then take back to their supervising partners for approval.

            At this point, I felt like either Vladmir or Estragon waiting for Godot (Waiting for Godot by Samuel Beckett), since each attorney was waiting on the other to make the first move and neither could do so because of the instructions they were given by their respective supervising partners.

            Needless to say, the matter did not settle. The sad part is that both counsel wanted to settle the matter and clearly recognized that the matter should be settled rather than tried. But their negotiations were not their own: they were mere puppets.

            It was a frustrating experience not only for the attorneys and plaintiff but for me as well. There was nothing I could do to help them settle the case as the parties with the authority to settle simply were not there! I was mediating with empty chairs. There was nothing in my toolbox that could help me other than to tell them to go home and keep negotiating via their supervising partners.

            So – this is why the courts require those persons with the ultimate settlement authority to be physically present at a mediation. Without them, the mediation is fruitless: we are simply waiting for Godot.

            . . .Just something to think about.

             People come to mediation to settle their disputes. Or, so they claim! But, do they really want to settle? In her monthly column, One Minute Negotiation Tips, published by the Los Angeles County Bar Association (Vol. IV, No. 9, October 2011), Ms. Linda Bulmash asks this fundamental question: Is Your Client Sure That He/She Wants To Settle?

            The reason for the question is that most people base their answer on whether they think they will be happy or upset with the proposed settlement. As Ms. Bulmash explains:

“At the core of most people’s decisions regarding whether to take an offer is whether they believe they will happy if they get it or how upset they will be if they don’t get what they want. But studies have shown that people are usually wrong when predicting how happy/unhappy they will be … this has been termed “miswanting”. Attorneys and mediators are in a unique position to help their clients anticipate what their future feelings will be.”

     To meet this challenge, Ms. Bulmash suggests that the following steps be taken:

 “1. EDUCATE. Explain the phenomenon of “miswanting” to your client. As an example, you can point out that studies have shown that after the initial excitement, lottery winners are no happier than they were before they won.”

“2. HELP YOUR CLIENT IDENTIFY A DEFAULT HE/SHE CAN LIVE WITH.”

“3. USE FRAMING STRATEGIES. Remember that decision makers are strongly influenced by how information is presented. Since we tend to prefer a “sure thing” to a potential gain, frame the settlement as safer than a trial.”

“4. TIME OUT. Insist your client takes a cooling off period before making the final decision. Time away from the bargaining table makes it easier for people to control their emotions. Take your client for a walk.”

“5. HELP YOU CLIENT TO FOCUS ON THE FUTURE AND NOT THE PAST INJURY OR HURT. Ask your client to imagine waking up tomorrow having not settled and what the day would feel like. Now have him/her imagine what the day would feel like if he/she had settled.”

“6. RECOGNIZE THAT SOME CLIENTS HAVE A DIFFICULT TIME LETTING GO OF THE FANTASY OUTCOME. In some respects, settling is a mourning process. Your client has fantasized about the outcome of this dispute for a long time. The reality of settlement does not compare to the fantasy. Allow your client to express feelings about this.”

            By doing so, a settling party will be more accepting of the settlement and not feel that she was forced into agreeing to it. She will not have regrets or remorse afterwards, having dealt with such issues beforehand!

            . . .Just something to think about!

            In its latest Technology Quarterly section, The Economist published an article entitled “Game Theory In Practice” (September 3, 2011) in which it explores using “game theory” to forecast political and economic events and to resolve disputes.

            It seems that Bruce Bueno de Mesquita, an academic at New York University,  has used game theory to accurately forecast the downfall of Hosni Mubarak as Egypt’s president, the departure of Pervez Musharraf from office in Pakistan and to predict the successor to Iran’s Ayatollah Khomeini. To do this, he used a computer model based on “game theory” in which numerical values are placed on goals, motivations and the influence of “players” (i.e., negotiators, business leaders, officials et cetera). “The computer model then considers the options open to the various players, determines their likely course of action, evaluates their ability to influence others and hence predicts the course of events.” (Id.) To use Mr. Mubarak’s departure as an example, the computer model considered the following:

Mr. Mubarak’s influence, for example, waned as cuts in American aid threatened his ability to keep cronies in the army and security forces happy. Underemployed citizens then realized that disgruntled officials would be less willing to use violence to put down street protests against the ailing dictator. (Id.)

            Other consulting firms have used game theory computer simulations to determine how “best to outfox a trial prosecutor, sway a jury, win support from shareholders or woo alienated voters. . .” (Id.)

            But, the one deficit in using such technology is that game theory cannot take emotions into account. Their predictions will go astray when irrational emotions such as hatred overtakes the pursuit of one’s best interests. Where money is the motivating factor, the computer program works well as long as human irrationality does not  intervene.

            The article describes how computer simulations have been used in auctions, to save bidders money in winning FCC (Federal Communications Commission) radio-spectrum licenses. It saved Time Warner and Comcast approximately $1.2 billion in their bid for licenses.

            Computer simulations were also used to find Osama bin Laden’s hideout in Abbottabad, Pakistan.

            As expected, and as I mentioned previously in this blog, efforts are underway to develop software to be used in negotiation and in mediation:

Two decades ago Clara Ponsati, a Spanish academic, came up with a clever idea while pondering the arduous Israeli-Palestinian peace process. As negotiators everywhere know, the first side to disclose all that it is willing to sacrifice (or pay) loses considerable bargaining power. Bereft of leverage, it can be pushed back to its bottom line by a clever opponent. But if neither side reveals the concession it is prepared to make, negotiations can stall or collapse. . . in 1992, Dr. Ponsati described how software could be designed to break the impasse.

            Rather than using a human mediator to nudge the parties toward common ground, a computer would do this. Negotiating parties would provide the computer with their confidential information on their bargaining position after each round. “Once positions on both sides were no longer mutually exclusive, the software would split the difference and propose an agreement.” (Id.)

            Barry O’Neill, at University of California at Los Angeles, has created a model to assist in divorce settlements: Each spouse assigns a numerical value to each household asset, giving a higher or greater value to those particular assets he/she wants to keep. They provide their valuation to the computer software which then does the rest by distributing the asset to the spouse who valued it more.

            In my previous blog on this topic, I was concerned that I might become unemployed as a mediator. But I am not so concerned anymore, as I have learned that the best software in the world cannot take into account human nature, irrational emotional behavior, or as I described last week – “difficult” people. Because of this, there will always be a need for a flesh and blood mediator like me!

            . . .Just  something to think about. 

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              Time sure does fly! It is that time of year again, and I can’t believe that it has already been a year since I was President of SCMA. The Southern California Mediation Association (“SCMA”) is holding its 23^rd Annual Conference on November 4-5, 2011 in Los Angeles, CA. Entitled “Putting Mediation to Work: Expanding Horizons, Expanding Opportunities”, the conference is different from all previous years. (Conference Flyer) The chair and president elect Barbara Brown has truly thought outside the box by creating two concurrent pre-conference Institutes scheduled for Friday afternoon (November 4, 2011). Institute 1 will explore elder mediation (“Rules, Tools and Ethics for Elder Mediation in the Age of Longevity: Multi-Disciplinary Approaches to Shared Family Decision Making”) while Institute 2 delves into collaborative family law. (“The Synergy between Mediation and Collaborative Practice: How Skills, Roles and Practice Develop Work Together.) And, the presenters are world renown: Kenneth Cloke, Esq. and Marcia Haber, Esq. will discuss Elder Mediation while Forrest Mosten, Esq. and Diana Martinez, Esq. will discuss Collaborative Practice. It will definitively be an informative afternoon.

             The conference itself, on Saturday, November 5, 2011 at the Strauss Institute of Dispute Resolution at Pepperdine University’s Law School in Malibu, includes sessions exploring the many different aspects of mediation: international, intercultural, transformative, ombudsman, online and even conflict coaching. By the end of the day, we will have all learned how pervasive mediation can be in our everyday lives.

              But, to end the day, Ms. Brown has arranged to do so on a very high note – by scheduling Father Gregory Boyle, Founder of Homeboy Industries and nationally recognized for his work, to be the keynote speaker. In further recognition of his valuable contributions, SCMA will award him with its 2011 Peacemaker of the Year Award. I am definitely looking forward to hearing Father Boyle speak: he will energize us all!

            Needless to say, I am attending and hope to see you there!

            . . . Just something to think about!