The IP ADR Blog Continues

Posted on January 7, 2010 by Victoria Pynchon

As I mentioned in my last post, I decided to more or less abandon the IP ADR Blog and pursue a more general blog about Commercial ADR, including arbitration and mediation, focusing on the business of business and the substantive laws with which business people and their lawyers must grapple, recommending litigation in some cases, arbitration occasionally and mediation and settlement (a lot!)

One of the long-standing members of the IP ADR Blog and IPADR.COM, as well as my good friend and Straus Institute colleague Eric Van Ginkel, will be picking up the baton and continuing to write about IP issues, both nationally and internationally, with the assistance of attorney Robert Rose at Sheldon Mak and a few other IP experts.  Even I'll be staying around and contributing a post or two whenever I have IP thought.

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IP ADR Blog Merges with Commercial ADR Blog

Posted on December 11, 2009 by Victoria Pynchon

I’m merging the IP ADR Blog with a new blog called Commercial ADR – Business Solutions to Justice Problems.  I’ll continue to post articles to the Settle It Now Negotiation Blog on matters of general interest to negotiators, including litigators who negotiate the settlement of lawsuits and some of my colleagues might post occasional IP ADR Blog articles here.  At some point, however, I'm going to have to shut the IP ADR Blog down.

After three years of negotiation and general ADR blogging, I feel the need to narrow my Negotiation Blog posts and expand my IP ADR Blog posts to the type of work that consumed the vast bulk of my 25-year litigation and trial career – general commercial litigation.

Since 1982, I’ve been litigating and trying commercial cases of all stripes, including the small business dispute.  I’ve represented garment manufacturers, car dealers, medical groups, insurance carriers, cable companies, import/export businesses, banks, title companies, stock brokerages, law firms, hospitals, agri-business, contractors, and the people who own, manage or represent these commercial concerns in-house.  I’ve also represented the interests of small business people in the predictable conflicts in which they become involved, including partnership disputes and other actions in which fiduciary duties or contractual obligations have allegedly been breached.

In the course of handling business-to-business disputes, I’ve prosecuted and defended legal actions for copyright, tradename, trademark, and patent infringement; securities fraud; and, insurance coverage (particularly concerning catastrophic environmental liabilities); antitrust; and, unfair competition disputes.  I have also represented both the Plaintiffs and the Defendants in nationwide class actions; and, from time to time, represented attorneys and accountants in malpractice cases.  I even have a small amount of experience representing employees and employers in wrongful termination and discrimination cases, but certainly not enough to call myself an expert in that field.

In the course of my ADR career, I have continued to focus my practice on commercial disputes, although I have also mediated employment, legal and medical malpractice, and personal injury cases.

Colin Powell famously said that the most important knowledge to possess in international diplomacy is the “other guy’s decision cycle.”  What interests must the client serve and to whom does he or she answer?  What potential damage might there be to the career of in-house counsel or a high-level manager if the litigation goes south or the mediated settlement agreement angers the Board, the shareholders or even the public?  Are there tensions between counsel and client that should be resolved if the settlement reached will serve everyone’s interests?  Are there upcoming mergers or other significant corporate events that make “circumstances” more important than the merits of a particular piece of litigation?

This describes just the tip of the iceberg of the commercial litigation and settlement “decision cycle,” I know intimately. I know what keeps clients awake at night because their concerns have been my business for more than a quarter of a century.  I also know at greater depth than I know anything else the competing demands and hard hours my new “clients” – commercial litigators – labor under on a daily basis.  And having cut the law firm umbilical cord five years ago, I finally know first hand the challenges of running one’s own business.

This is what I bring to my mediation practice, along with the negotiation and mediation skills I have been studying, writing about, and teaching with great diligence for the past five years.  I continue to teach trial and deposition advocacy for the National Institute of Trial Advocacy just to keep my hand in the adversarial system.  I also continue to follow developments in the law of all of the specialties that consumed my practice as an attorney.

And then there’s that LL.M in Conflict Resolution that perplexes most people in the legal community.  One of my dearest friends – a man who served as my discovery referee for seven years – asked me “how many ways are there to stir the mediation  pot?”  Thousands, it turns out, particularly given the enormous progress that has been in the science of the mind, the study of decision-making and the examination of cognitive biases since I was at University.

Sitting on this side of the table for the past few years has been as confounding as it is exhilarating.  I remain steadfastly convinced that the principle problem at hand is a commercial one to which there is almost always a better business, than a legal, solution.  That does not mean that I ignore or marginalize the “merits” or “positions” of the parties.  The ability to analyze the facts and the law of matters that have been in litigation for years — sometimes decades — in several hours or a couple of days is the mandatory minimal qualification for anyone who wishes to help litigators resolve commercial disputes.

Though the law “monetizes” injustice, no one – not even the most cynical Fortune 50 client – wants to settle a case that leaves the bitter taste of injustice in his mouth.    To deliver the benefits of the legal system to our clients we must never forget that they seek out the services of the “justice system” because they believe they have been treated unfairly.  So it is that a critical element of every “commercial” solution to every legal/business conflict, is the resolution – even at the level of “rough” justice – of what brought clients to lawyers in the first instances – their perception that they have been cheated, blackmailed, insulted, taken advantage of, lied to, coerced or disrespected.

After twenty-five years of legal practice, I can say with conviction that the highest and best use of every mediator is to help the lawyers help their clients obtain – at a minimum – a “deal” that not only releases them from the trap of litigation, but one that releases them from the grip of injustice.

All of these goals; each of these interests; and, every one of these skills, are possessed by dozens of mediators with whom I have worked or who I have observed in the course of their work.  I’m certainly not the best nor the only passionately competent commercial mediator in the business.  I’m just one of them.

This new Commercial ADR Blog will cover not only negotiation and mediation strategy and tactics — including tips for resolving thorny legal and commercial problems, but also the social psychology of conflict as it relates to the business of commerce.  I will also cover  developments in commercial law and civil procedure that are particularly relevant to the settlement of litigation.

I hope you’ll join me here.

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Von Dutch Tradename Settlement Gives Rise to Legal Malpractice Action and Questionable Mediation Confidentiality Decision

Posted on November 14, 2009 by Michael D. Young

by Michael D. Young

Here we go again.  A California appellate court has judicially created another exception to mediation confidentiality -- this one for alleged attorney malpractice occurring during the mediation but outside the presence of the mediator or opposing parties. Cassel v. Superior Court (.pdf). 

Essentially, the court (in a 2-1 vote) holds that a communication with one's attorneys only -- one that does not involve the mediator or the opposing party -- is not part of the mediation process, does not fall within the policy reasons supporting confidentiality, and hence is not protected by California's mediation confidentiality statutes.

For those who are interested, I go through the case  in a little more detail below.  However, at this point, I have  a question:  

Is there a public policy reason to protect communications  between an attorney and a client (and only between them) during the mediation  process?  In other words, do we need to protect those private  communications in order to reap the benefit of mediation?  Or are the  policies behind confidentiality amply supported if we only protect  communications with the mediator and opposing parties?  I had always  thought of confidentiality as being necessary to encourage frank and candid  discourse between the disputants.  Is it also necessary to encourage frank and candid discourse between a client and his or her own  counsel?

SUMMARY OF OPINION

In this new case, Cassel v. Superior Court, the client alleged that his attorneys bullied and coerced him into signing a settlement agreement in mediation that was for less money than the client wanted.

He wanted to introduce evidence of things his attorneys said and did during the private time in the mediation when neither the mediator nor opposing party were present.

The debate was:  (a) were these communications simply privileged under the attorney-client privilege (and thus waived in a subsequent malpractice claim); or (b) were they also covered by the mediation confidentiality statute (not a privilege), and thus inadmissible even in a subsequent malpractice claim.

The trial court held the communications inadmissible under the mediation confidentiality statutes, and then stayed the proceedings to allow the parties to take a writ.

The appellate court looked at the policy behind confidentiality and decided it did not apply to communications between a party and his or her own counsel:  

Legislative intent and policy behind mediation  confidentiality are to facilitate communication by a party that  otherwise the party would not provide, given the potential for another party  to the mediation to use the information against the revealing party;  they are not to facilitate communication between a party and his own  attorney.

The court quoted language from other cases describing the purpose of confidentiality to encourage frank discussions with "the mediator" and "the opposing party.The court acknowledged the Wimsatt case (familiar to our California brethren) which upheld confidentiality in the face of malpractice claims.

That court reluctantly stated:

[t]he stringent result we reach here means that  when clients ... participate in mediation they are, in effect, relinquishing  all claims for new and independent torts arising from mediation, including  legal malpractice causes of action against their own counsel.

The Cassel court sidestepped this by saying the quoted language was not the Wimsatt court's holding and thus was not binding authority.  Instead, the Cassel court determined that the attorney/client communication, despite being held during a mediation process and addressing issues such as whether the client should settle and for how much, was not "linked" to the mediation:  "there is no readily identifiable link to the mediation in the communications."  ["Huh?" says Mike.]

As another example of why the communications were "tenuous," and were "more related to the civil litigation process as a whole rather than to the mediation:" 

For example, according to the record, Cassel[] expressed in his  deposition that, during the course of Wasserman Comden's conference with  their client that occurred after the mediation process had begun, he was  evaluating the value of the case as he always does when it appears that the case will go to trial.

[Can I say HUH? a third time?  Of course one values a case when it appears it will go to trial.  One values a case before it is filed and at every stage thereafter.  One also values a case in mediation; and indeed, one uses the mediation process to refine and test that valuation.  According to this court, simply because the communication was of a type that occurs as part of the trial process, it is not sufficiently "linked" to the mediation to enjoy confidentiality protection.]

After all this wind-up, the court finally got to what I think is the main point:

That  is, as we previously concluded, they were not  communications between “disputants” and the “mediator,” as required to come within the  definition of a “mediation” or “mediation  consultation” and, therefore, to qualify for  protection under mediation  confidentiality.

In other words, if the communication does not involve the mediator or the opposing party, it is not part of the mediation process, and hence is not covered by the mediation confidentiality statutes.  The attorneys were not part of the class of persons who confidentiality was designed to protect.

 One thought that comes from this -- the discussion between counsel and client during the mediation process regarding the wisdom of settlement will inevitably include an analysis of information and communications from the mediator and opposing party.  If these private attorney/client communications are admissible, won't that necessarily result in the disclosure of the mediator's and opposition's thoughts and actions?  Would this exception swallow the rule?  The Court anticipated this argument, and sidestepped it, with the following:

Neither Cassel nor Wasserman Comden assert that  the communications contained information which the opposing party (or its  representatives) or the mediator provided during mediation or otherwise  contained any information of anything said or done or any admission by a  party made in the course of  the mediation.

The dissent noted that the confidentiality statute covers all communications in mediation, and that the court should not judicially create new exceptions.  That's the legislature's job.

[Ed. note:  I reached the same conclusion over at the Negotiation Law Blog and also raised some questions about the recent Carrie Prejean/Larry King Dustup at the same time here]

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Insurance Coverage for Trademark Infringement Actions

Posted on November 13, 2009 by Victoria Pynchon

Whether a commercial case can be settled or not often depends upon the existence of insurance coverage.  This opinion - answering the question "yes" for a trademark infringement action - was sent down by the California Court of Appeal today.

Caveat reader:  I haven't read the case yet and am only providing the summary provided by a local legal rag below (I'll come back to this).


Where insurance policy defined covered "advertising injury" as "injury arising out of one or more of the following offenses: a) oral or written publication of material that slanders or libels... b) oral or written publication of material that violates a person’s right of privacy; c) misappropriation of advertising ideas or style of doing business; or d) infringement of copyright, title or slogan," such policy included trademark infringement actions. Prior publication exclusion applies to trademark infringement claims where the claimed offending words in underlying action both before and during the policy period are identical. Kim Seng Company v. Great American Insurance Co. of New York - filed November 13, 2009, Second District, Div. Five.

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Are We Having a Conversation or a Meeting with the Choir: Cass Sunstein and Cyperpolarization

Posted on October 29, 2009 by Victoria Pynchon

If you'd like to better understand what's really going on in separate-caucus mediation and, by the way, also in famous "conversation" happening in the blogosphere, do check out the New Yorker's Cass R. Sunstein and Political Rumors on the Internet by Elizabeth Kolbert.  Excerpt below and my own short article on conspiracy theories in the adversarial system here.

There is virtually no opinion an individual can hold that is so outlandish that he will not find other believers on the Web. “Views that would ordinarily dissolve, simply because of an absence of social support, can be found in large numbers on the Internet, even if they are understood to be exotic, indefensible, or bizarre in most communities,” Sunstein observes. Racists used to have to leave home to meet up with other racists (or Democrats with other Democrats, or Republicans with Republicans); now they need not even get dressed in order to “chat” with their ideological soul mates.

“It seems plain that the Internet is serving, for many, as a breeding group for extremism, precisely because like-minded people are deliberating with greater ease and frequency with one another,” Sunstein writes. He refers to this process as “cyberpolarization.”

Put the Web’s filtering tools together with cyberpolarization and what you get, by Sunstein’s account, are the perfect conditions for spreading misinformation.

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Arbitration's "Down" Side: Two Years of Proceedings; $20 Million in Punitives; and, No Appeal

Posted on October 27, 2009 by Victoria Pynchon

This just in from the Ninth Circuit -- In re Bosack -- an opinion affirming the trial court's refusal to vacate an arbitration award totaling nearly $20 million after proceedings that "lasted two years, during which more than sixty days of hearings were held, more than twenty witnesses testified, and over five hundred exhibits were entered into evidence."

The contested award?

The arbitration panel's finding that Respondents Bosack and Lerner "had 'acted with malice and oppression,' and that [Petitioner] Soward was entitled to punitive damages of $10,999,494 against Bosack, and $8,555,162 against Lerner."

Doctrines discussed:  functus officio; manifest disregard of the law; the scope of review ("whether or not the panel’s findings are supported by the evidence in the record is beyond the scope of our review";) and, whether the Court can vacate an award based upon the argument that a punitive damages award is unconstitutional (no).

Not quite an arbitral Bleak House but no cost-efficient proceeding either.


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The Benefits of Interest-Based Negotiation in IP Disputes

Posted on October 27, 2009 by Victoria Pynchon

I've been thinking jurisprudential thoughts for the last couple of weeks because I'm finishing the second draft of the ABC's of Conflict Resolution and because I made the terrible error of trying to cover the history of dispute resolution in Blawg Review # 234 (as Ed. commented:  "war and peace?  best of luck with that!)

Yesterday, I finished J is for Judge and L is for Lawyer (and moved on to the revision of P is for Paranoid).  So I was thinking a lot about the rights, obligations, and remedies business; adversarialism and its discontents; and, competitive-position based negotiation.  Then I had dinner last night with Stephanie West Allen of Idealawg and Brains on Purpose (she is here for a neuroscience conference at UCLA) and we talked about the theory and practice of mediation -- separate caucus position-based facilitated distributive and competitive bargaining vs. client-centered interest-based transformative mediation.

My brain hurts.

And I still have to revise K is for Kin (-selection); T is for Terrorist; and V is for Victim before the week is out.

So I'm just going to provide you with something to think about from a year 2000 article provocatively entitled Forget the Mechanics and Bring in the Gardeners:  an Exploration of Mediation in Intellectual Property Disputes.

Irrespective of the source of the conflict between the parties, it must be formulated in court as a disagreement over norms and/or over factual matters... The verdict of the court has an either/or character; the decision is based upon a single, definite conception of what has actually taken place and upon a single interpretation of the legal norms.

 

Fisher & Ury, supra note 53 at 4-5: "When negotiators bargain over positions, they tend to lock themselves into those positions... As more attention is paid to positions, less attention is devoted to meeting the underlying concerns of the parties... Bargaining over positions creates incentives that stall settlements... Positional bargaining becomes a contest of will" At 4-5.

As Julie Macfarlane reiterated, an emphasis on litigation reflects, ".. .the dominance of a 'rights' culture, seen in both the justice system and public attitudes towards conflict and reconciliation." The court therefore, focuses on rights, and winners and losers, while mediation is designed to focus on parties' interests' and mutual gain.  Julie Macfarlane, "The Mediation Alternative" in Julie Macfalane, ed., Rethinking Disputes: The Mediation Alternative (Toronto, ON: Emond Montgomery, 1997) at 5.

The courts' focus on rights affects the negotiation strategies that parties utilize. As I mentioned, most of the early texts used in law schools to teach negotiations, for example, focused on the "competitive strategy" and at least implicitly endorsed such a strategy. The competitive negotiator tries to maximize the benefits for her client by persuading her opponent to settle for less than the opponent would have settled with at the beginning of the negotiation. The underlying premise of the competitive strategy is that all gains for one's own client are obtained at the expense of the opposing party. In other words, competitive negotiators see the negotiation as a competition over a fixed pie. As such, these negotiators work to convince their opponents that their settlement alternative is not as advantageous as they previously thought, in turn lessening the opponent's confidence in their case and thereby inducing them to settle for less than they originally asked. The competitive negotiator therefore, moves "psychologically against the other person," with behaviour to unnerve the opponent,68 and may employ very strategic tactics:

• arrange to negotiate on their own turf;
• balance or slightly outnumber the other side;
• designate one of their demands as a "precondition";
• make the other side tender the first offer;
• make the first demand very high;
• make the other side make the first compromise;
• invoke law or justice;
• be tough -- especially against a "patsy;"
• appear irrational where it seems helpful;
• claim that they do not have the authority to compromise; and

• will themselves promptly reduce the agreement to writing.69

Not surprisingly, competitive negotiators expect similar tactics from their opponents and therefore mistrust them.

It is interesting to note that law, through its legal principles and male's historical domination of the legal profession and the public sphere more generally, may have in fact facilitated these competitive negotiation strategies. These competitive negotiation strategies, lined with deception and mistrust, seem fuelled, or at least reinforced, by certain common law principles like "caveat emptor", which warns, "let the buyer beware."  Although there is no consensus when caveat emptor came into being most agree that it was the case of Lopus, which had been credited as the originator of the doctrine of caveat emptor under English common law. The decision was recognized for the proposition that English courts were not interested in enforcing the fairness of an exchange because they thought contracting parties should handle such matters themselves. Couple legal principles like caveat emptor with how men have been socialized to be competitive and to play a prominent role in the public sphere and we begin to see how this competitive negotiation strategy came to flourish. Put plainly, the courts and the legal system in general seem to facilitate competitive negotiation tactics.

For anyone who's made it this far, hopefully, LexBlog has gotten my comment section working again for you to leave your thoughts.

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Dispute Resolution and Social Media Online Event Announcement

Posted on October 25, 2009 by Victoria Pynchon

ODR WEEK 2009 Web 2.0: Going from OH? To KNOW!

Friday October 30th

2:30pm - 3:30pm est. (it will be archived too!)

Spots limited, see below.

Join Jeff Thompson (www.enjoymediation.com & Centre For Peace & Social Justice) and an all-star lineup of Mediate.com featured bloggers:

Diane Levine (www.mediationchannel.com)
Victoria Pynchon (www.Negotiationlawblog.com)
Tammy Lenski (www.MakingMediationYourDayJob.com)
John Ford (editor, www.mediate.com)

They will be discussing web technology!

Find out how and why they do it (successfully!), the benefits and how it is has helped them. Learn tips and skills that can help your practice too!

***FREE*** But spots are limited: sign up by emailing Jeff @ mediator.jeff@gmail.com

If you are interested in submitting a question prior to the event for the panel, email Jeff at the address above or simply post a comment in this post.

Go to www.EnjoyMediation.com for more info on this event and for more info on ODR Week, go to www.ODR.info

This event is presented by EnjoyMediation & the Centre for Peace and Social Justice, Southern Cross University, Australia.

 

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Using the Power of Social Media to Win Copyright Fight

Posted on October 23, 2009 by Victoria Pynchon

The following from Carolyn Elefant at My Shingle:

[T]his recent article from NPR . . .  reports on Rock Art, a local Vermont brewery that successfully fended off a copyright challenge by the national company that makes Monster energy drink.  Rock Art didn't win as a result of a clever legal team. In fact, after Rock Art received a cease & desist from Monster, demanding that the company stop using the name Vermonster in connection with its drink, Rock Art's lawyers told the company that fighting a national corporation would be too pricey and that the company was better off registering a less controversial trademark.  After Rock Art's lawyers backed down, Rock Art launched a social media campaign, enlisting customers to help with the effort.  The campaign went viral and ultimately, the bad publicity lead Monster to back down.

Now that's alternative dispute resolution.

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We Welcome IP Watchtower to the IP Blogosphere!

Posted on October 20, 2009 by Victoria Pynchon

That person ringing your virtual doorbell is not -- I repeat not -- someone trying to sell you magazine subscriptions or somebody's else's religion.  No!  That's the incredibly bright, accomplished and talented Erica Bristol delivering up-to-the-minute news and analysis on the most important intellectual property issues of the day. 

That's right!  It's Erica!  Who has an extremely cool new website (Erica Bristol, Mediator) and a terrific new blog -- The IP Watchtower.

Here are Erica's creds:

Erica Bristol is an attorney and mediator practicing in Southern California. She received her law degree from the UCLA School of Law in 1999. Her practice areas include intellectual property, contracts, real estate and business transactions. Ms. Bristol completed the Los Angeles County Bar Association/Dispute Resolution Services' Mediation Training Program. She serves as a federal settlement officer for the United States District Court, Central District and a court-appointed mediator for the Los Angeles Superior Court. Ms. Bristol is a member of the Trademark and Licensing Committees of the Intellectual Property Section of the State Bar of California and the Business & Corporations and Corporate Law sections of the Los Angeles County Bar Association.

We promised not to mention that you can find Erica astride her motorcycle most weekends but what are girlfriends for if not to make one another way more interesting than they at first appear?

 

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