Often, the BATNA (best alternative to a negotiated agreement; one of the core principles from “Getting to Yes”) in a lawsuit-based mediation is a trial in a court of law. Some trials are bench trials (where a judge makes the decision on the outcome, such as in a divorce) and others are jury trials (where in NJ, 5 of 6 jurors[your peers] have to agree on an outcome. As most attorneys will say, trials and trial outcomes are a crap shoot.
There are two reasons as to why this is largely the case. First, trials are performances. The lawyers, clients and witnesses are all putting on performances in court. They are all humans. They all have good days and bad days. Perception is everything in court as to credibility of those giving testimony and attorneys. Second, every human being has prejudices and built in biases. We all see the world through the filters that have been taught to us by our parents and peers growing up and our cumulative experiences. Judges and jurors are humans with these biases. A jury is somewhat randomly selected…as one of my colleagues likes to point out, they are the 6 people standing in line behind you at Wal-mart or Target. It’s a crap shoot as to who you get and voir dire (the process of selecting a jury and questioning jurors about their backgrounds and biases) can only peel back some of the layers of bias of a potential juror, not all of them.
If trials and the legal process were cut and dried, there would be no need for appeals, appellate division and the Supreme Courts. But we have them because errors are made and court decisions are often overturned (which consumes a lot of time and money to do so).
Here’s an interesting thing to ponder. Why does the same case — which has the same facts — when tried more than once (either through a mistrial/hung jury, or on remand from an appeal) often have differing outcomes?
In today’s Rocky Mountain News, an article enumerates on some recent high profile criminal trials which went more than once and their various outcomes. Here’s an excerpt:
Dennis Kozlowski, former CEO of Tyco International Ltd.; Mark Swartz, former Tyco chief financial officer
* Accusations: Kozlowski and Swartz were charged in September 2002 with stealing $170 million from Tyco by abusing corporate loan programs and taking unauthorized bonuses and by taking $430 million more by selling stock at prices artificially inflated by misstatements about company finances.
* First trial: Ended in mistrial in April 2004 after several news organizations published a juror’s name during deliberations, and the juror told the judge she received a threatening letter and phone call.
* Second trial: Prosecutors tightened their case and spent far less time on Kozlowski’s extravagant lifestyle.
* Results: Both men were convicted June 17, 2005, of grand larceny, conspiracy, securities fraud and falsifying records.
Richard Scrushy, former CEO of HealthSouth
* Accusation: Prosecutors accused Scrushy of masterminding a $2.7 billion accounting fraud at HealthSouth Corp. to inflate the company’s stock price.
* First trial: Acquitted by a Birmingham, Ala., jury in June 2005, despite the 15 guilty pleas from other former HealthSouth executives who implicated Scrushy.
* Second trial: Six Alabama charges of bribery, mail fraud and conspiracy. Defense lawyers denounced the case as a sour-grapes effort to win a conviction.
* Results: In June 2006, Scrushy was convicted of paying $500,000 of bribes to former Alabama Gov. Don Siegelman.
Frank Quattrone, former investment banker at Credit Suisse in New York
* Accusation: Prosecutors said Quattrone hindered the government’s investigation of Zurich-based Credit Suisse, Switzerland’s second-largest bank, by endorsing a subordinate’s e-mail that advised employees to “clean up” their files. The government said he sent the message, suggesting that subordinates destroy records, after learning that a grand jury was probing how Credit Suisse doled out IPO shares.
* First trial: Hung jury in October 2003.
* Second trial: Conviction for obstruction of justice and witness tampering in May 2004.
* Results: Conviction reversed on appeal. Prosecutors decided not to re-try him and dropped the case in August 2007.
While criminal trials have a far greater burden of proof than civil trials do, the point of risk at trial is analogous. In a later posting, I will give an example of a civil case which was tried 3 times with 3 different outcomes.
The BATNA in a civil case is a negotiated agreement. Your risk goes to zero since you agree to the parameters of the settlement. Your costs also go down as trials are costly; lawyers, trial preparation and experts all cost money. And they cost the same amount of money if you win or lose. Plus, litigants also often forget about the other costs, namely your time and emotions/aggravation factor. These are all legitimate. There are large costs to “prove” you’re right.
This is why mediation has gone mainstream and is accepted as a way to resolve disputes, whether they be commercial or family in nature. If you want to avoid the risk of a trial and going to court, feel free to contact me to see how mediation can help.