Mediation is an effective option for companies looking to minimize the distractions and expense of lengthy litigation matters. When should general counsel choose mediation? In short, the answer is as early as possible because doing so can effectively streamline the conflict process.
As corporate counsel well know, litigation can involve substantial legal fees, administrative costs, and other expenses, but more importantly, can distract the management team from its priorities and focus. This distraction, paired with the fact that litigation can be a lengthy public process that may take years to conclude, means that financial resources and the time and attention of key personnel will be diverted away from critical business activities. Whether an employment dispute or a complex commercial dispute, litigation can have a significant impact on employees and the workplace environment as the adversarial nature of litigation can cause undue stress and worry on all persons involved, even those with only tangential involvement. Ultimately, litigation distracts from the Company's productivity and its ability to focus on its business.
Savings of Time, Resources and Costs
Whether mediation is initiated pre-suit or during the course of litigation, an immediate benefit is savings of time, resources, and costs. Mediation allows the parties to work together to resolve a dispute without the risk and uncertainty of litigation that concludes with a trial. Mediation provides an alternate to the all-or-nothing approach of trial, which inevitably results in winners and losers. In mediation, no party loses, as the parties along with the third-party neutral work together to resolve the conflict and create a win-win for all parties involved. As opposed to the long and arduous court process that can last for years and is largely out of the control of the parties, mediation allows parties to work at their own pace and schedule sessions that suit their availability. Moreover, a mediator is able to provide individual attention and experience to the matter along with the time and focus necessary to bring the matter closer to final resolution, whether it be over a one-day mediation session or multiple mediation sessions over the course of several months. Unfortunately, due to overburdened dockets, courts are not as readily available to provide the parties with the attention necessary to guide the amicable resolution of disputes. The flexibility, individualized attention, and knowledge provided by the mediator can accelerate the resolution process and help parties move forward expeditiously.
Maintaining Relationships
Litigation matters can involve parties that may continue to do business together, or work together in some capacity, moving forward. In these types of matters, it can be extremely valuable to find solutions that help to maintain important relationships, for instance with clients, customers or vendors, through the use of mediation. Since the parties work with the mediator to ensure that all avenues of compromise have been explored, mediation focuses on finding common ground and facilitating understanding between the parties. This approach can eliminate the adversarial nature of the dispute and requires the parties to work collaboratively, preserving the parties' relationships and promoting a cooperative environment. Importantly, mediation also allows the parties control the outcome of the matter, providing flexibility to craft creative settlements which are tailored to the specific needs and interests of the parties.
Protecting Confidential Information and Future Strategies
Protecting a company's future litigation strategies is another benefit, since mediation avoids having a judge or jury make findings of fact, which can set precedent and impair the Company's future litigation strategies. In addition, mediation solves various venue issues, including unfavorable jury pools. Lastly, parties to litigation take the risk that the Company's confidential or private information will be revealed, either to the other parties or to the public. Mediation significantly reduces this risk along with the risk of reputational harm that can be caused by protracted and public litigation. The confidential nature of mediation ensures that sensitive business issues remain private. By choosing mediation at the earliest stage possible, the Company's proprietary and confidential information as well as its reputation can be protected. Mediation provides the opportunity to secure a successful resolution that upholds the rights of the parties, meets the parties' goals, preserves relationships, and avoids the time, expense, and drain on the Company's resources associated with traditional litigation. Therefore, mediation should be seriously and thoughtfully considered by the Company at the earliest possible time in an effort to avoid both the immediate and prospective detrimental impacts traditional litigation may have on the Company.
The Honorable Joseph A. Dickson is a former Federal Magistrate Judge for the U.S. District Court for the District of New Jersey. He focuses his practice on bringing closure to disputes through mediation and arbitration.
Nicholas A. Grieco is a litigator who focuses his practice on governmental and municipal litigation, commercial and business litigation, insurance defense litigation, tort litigation, corporate general counsel services, mediation and arbitration.
