Settlement Strategy: Settle More Cases With Interest-Based Negotiation Techniques

Business handshake, the deal Is finalized

As you develop a settlement strategy for your lawsuit, here’s something to consider:  Would it surprise you that there is a great deal in common between the negotiations to resolve global conflict and negotiations for the resolution of litigation?

I recently interviewed Dr. Matthew Levinger, a Research Professor at George Washington University’s Elliott School of International Affairs, where he directs the National Security Studies Program (an executive education program for senior military and civilian officials) and the Master of International Policy and Practice program.  Among his previous positions, Matt (I’m calling him “Matt” with his permission; we are old friends from college.) was a Senior Program Officer at the U.S. Institute of Peace, Founding Director of the Academy for Genocide Prevention at the U.S. Holocaust Memorial Museum, and a William C. Foster Fellow at the U.S. Department of State, where he worked to improve U.S. government strategies for preventing mass atrocities. He is the author of Conflict Analysis: Understanding Causes, Unlocking Solutions (United States Institute of Peace Press, 2013), a primer on international conflict in the contemporary world.

Matt and I discussed his background in the field of global conflict resolution, and what litigators can learn and adapt from the successful negotiation of geopolitical conflict.

LK: Tell us about your background in the field of negotiation and settlement strategy.
ML: Both in my academic research and in my policy-oriented work, I have sought to explain the roots of radical political violence, in order to facilitate creative approaches to preventing and resolving deadly conflict.

Interest-Based Negotiations are More Effective that Simply Exchanging Numbers

LK: How can what you do in your work be helpful to attorneys as they approach settlement strategy for a contentious case?
ML: There are important similarities between conflicts involving nations and conflicts involving individuals or companies– such as litigation. One of the key similarities is that conflicts are never only about surface issues. Negotiators differentiate between positions, interests,and needs.

LK: Why is that differentiation important?
ML: The positions are what people say the conflict is about— the things that they are demanding from the other party. Let’s say two nations are fighting over a piece of territory. One side, Nation A, might want the territory for historic reasons, and the other side, Nation B, might want the territory for security reasons. On the surface this conflict appears to be unresolvable because only one of the two nations can possess the territory. But if we look beyond the surface positions to the underlying interests and needs, it’s possible that we may get to a win-win solution. For example, if the territory is restored to Nation A, but security guarantees are provided to Nation B, then both sides may be happy with the result. And, in fact this was the model for the resolution of the Camp David Accords, under which the Sinai Peninsula was given back to Egypt but security assurances were given to the State of Israel, which made it possible for the two nations to live in peace with each other since the late 1970s.

LK: Can you explain how to apply this scenario to litigation?
ML: Litigation between individuals can seem to consist of zero-sum games. What we have to do is move beyond the question of what the parties want, to the question of why they want it. For instance, a plaintiff suing for $10 million may be asking for money,  but the reason that she is asking for $10 million is that she wants an acknowledgment of her injury, or she wants respect, or she is frightened for her future and wants security. An effective negotiation strategy therefore requires us to understand the plaintiff’s underlying interests and needs. In general, all human beings have a need for recognition. Sometimes acknowledging a party’s humanity or dignity may be more important to that party than a monetary award.

LK: Our discussion reminds me of a client I worked with a few years ago and who came to me just before a mediation was to take place. It was a case against a school district. The plaintiff had sued for an extraordinarily large amount of money and was determined to bring the school district to court to “teach them a lesson.” She was taking a substantial risk to pursue this large sum of money.  I perceived that what she wanted more than anything at all was for someone of importance in the school district to actually “hear” what had happened to her. Fortunately the school district brought their superintendent to the mediation session. The superintendent understood immediately that what my client wanted was to be listened to, and heard. The superintendent asked that she and my client be allowed to sit in a room together alone with no attorneys present. All of the attorneys agreed.  The plaintiff and the superintendent were in the room for approximately 90 minutes. Shortly after they emerged, the case settled for a reasonable amount of money–well below what my client originally was seeking. Ultimately what had transpired in the room was that the superintendent gave my client her first opportunity to be fairly heard on a number of issues which had led to her dismissal from the school system, and then provided some assurances she would act on what she had been told.
ML: That’s a beautiful example of how you can win a piece of litigation without winning a jury verdict! Even though your client did not get the huge financial settlement she was seeking, she ultimately got what she was looking for, which was a more modest monetary settlement with a great deal of respect and acknowledgment attached to it by the school district. Human beings are fundamentally social beings. We frequently care more about intangibles like dignity and respect than we do about tangible things such as money. Even in getting a financial settlement, it’s critical that you understand the humanity and underlying motivations of the other side in litigation.

LK: I’m always really amazed when I think about the number of plaintiffs who would have settled cases for a great deal less, had the defendants been willing to apologize in the mediation. I never understand why an apology is so problematic for defendants who know that they have acted in a way that would warrant one. Why do people often refuse to apologize even where an apology is warranted?
ML: The short answer is that humans are prideful beings. We tell stories about ourselves that we cling to—stories about our own honorable nature, or about our good intentions, or about the injustices that have been visited upon us by an unfeeling world. To acknowledge our own wrongdoing is to call into question our belief in our own righteousness. An adversarial process such as litigation tends to reinforce stubborn behavior by defining one party as “right” and another party as “wrong”.

LK: One of the things I’ve always told clients about the litigation process is that it’s very difficult to sit in a room where another side is going to parade witnesses in front of you who are going to say that you are bad, or wrong, or not worthy, or a liar. It’s difficult to hear and I believe this creates an obstacle to a meaningful settlement. The litigation process, which clients often feel will be cathartic, in fact, can compound the injury more.
ML: This is why a zero-sum litigation process often leads both sides to lose. While one side may come away with tangible benefits, this may come with the loss of trust, loss of self-respect, or shattered relationships.

LK: Attorneys feel the brunt of these losses as well.
ML: You’re right. One way to lose in litigation is to become entangled in multiple years of hostility and recriminations on both sides. Even if you are successful after all this time in settling a case, as a litigator, you may still feel that your actions over a period of years have been virtually fruitless or that you have been spiritually decimated, having battled so long with so much ill will on all sides.

LK: How can litigators improve their chances for a successful strategy with other litigators?
ML: When you listen well to your litigation counterpart, he or she will typically listen better to you. When your counterparts understand your client’s needs for justice, recognition, and security, your counterparts stand a better chance of responding in a more accommodating manner.

LK: What advice would you give to plaintiff’s attorneys who are involved in litigation, but want to find a way of settling the case, if settlement is in the best interest of their client? Or to a defense counsel negotiating with a plaintiff?
ML: First of all, you need to understand what the plaintiff’s underlying needs are in bringing the suit, and focus less on the explicit position or demand than on these fundamental needs. We can’t win unless we know what we are trying to achieve. We can’t be successful unless we listen to those underlying needs. Then, you need to focus on what things might help the plaintiff achieve these needs—rather than leaping prematurely into a confrontational litigation stance.

LK: And for attorneys who are litigating against defendants, or who are advising defendants about settlement strategy, what is a good take away for them from what we’ve discussed?
ML: Defendants need to understand that the ultimate goal of the litigation process is to satisfy your own interests and needs, not to prove that you are right and the plaintiff is wrong. Rarely are our needs best served by years of acrimonious litigation which invariably result in thousands of dollars in legal fees, lost nights of sleep, and perhaps the diminution of standing or reputation — either personal or corporate. It may be better to say you’re sorry, when an apology is warranted, than to attempt to persuade a judge or jury of your own righteousness, which can come at great cost.

 

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