Case Excerpt

“Immediately following the conclusion of the mediation, Rains drove himself to a hospital emergency room where he was admitted and diagnosed with a ruptured cerebral aneurysm, sub-arachnoid hemorrhage, and stroke. Rains underwent surgery the next day and was placed in the intensive care unit for approximately one month prior to his eventual discharge from the hospital. Rains claims to have no recollection of the events preceding his hospitalization.... Rains submitted several declarations in support of his contention that he was mentally incompetent, including those of a neurologist who treated him for the aneurysm and a clinical psychologist who provided follow-up care. The neurologist opined that "Mr. Rains would have been without the mental capacity to engage in business affairs on September 23, the date of his hospital admission, and for a number of days on each side of that date." The psychologist concurred, stating that at the time Rains negotiated the settlement, he "would not have had his normal mental capacity and would have been incapable of conducting business affairs with competence."....

The trustee filed a reply controverting Rains's contention that he was mentally incompetent during the settlement conference. Accompanying the reply was a declaration from Gregory J. Hughes, counsel for the trustee. Hughes stated that he had a chance to observe Rains at the settlement conference. According to Hughes, Rains participated actively in the negotiations, arguing over the due date for a cash payment and over the use of funds in his retirement plan as security for the payment. After the settlement was reduced to writing, Rains reviewed the document carefully and asked his attorney questions about it. Hughes's overall impression also was that "Mr. Rains evinced a clear understanding of what was transpiring, the issues inherent in the settlement process, and the terms of the settlement as it evolved." Rains's creditor and her attorney submitted similar declarations.”

Case Excerpt

“Under Count II, respondent maintained a website that provided information to parents of special needs children with regard to meetings (mediation) with school officials concerning provision for the child's needs. The website suggested that among other things that the parents lie and create "throw away" demands to achieve successful results in the mediation.

Violations: Respondent's conduct violated Ind. Professional Conduct Rule 7.1(b), which prohibits a lawyer from engaging is public communication that is false, fraudulent, misleading or self-laudatory; and 8.4(d), which prohibit a lawyer from participating in conduct prejudicial to the administration of justice.

Discipline: Public reprimand. The Court, having considered the submission of the parties, now APPROVES and ORDERS the agreed discipline. The Court would have been inclined to impose a more severe sanction, but since it is this Court's policy to favor agreed resolutions of attorney disciplinary charges, we accept the tendered agreement. Costs of this proceeding are assessed against the respondent.

DICKSON, J. dissents, believing that for advising the public to lie at mediation meetings, the respondent should be suspended from the practice of law without automatic reinstatement.”

Case Excerpt

Morgan Phillips, a retailer of specialty bedding products, contracted with two suppliers for mattresses and box springs made according to Morgan Phillips' specifications. In October 1999, after discovering that the suppliers were not manufacturing the products as specified, Morgan Phillips sued the suppliers. The parties retained JAMS and Bates to mediate the dispute. In September 2000, Bates assisted the parties in reaching a settlement. The "stipulation for settlement" provided that "[d]isputes regarding this matter will be submitted to [Bates] for binding resolution." In 2002, Morgan Phillips again became dissatisfied with the suppliers' products, and invoked the dispute resolution clause of the stipulation for settlement. JAMS and Bates' entered a contract with Morgan Phillips that was partly written, oral, and implied by law. Under the contract, JAMS and Bates agreed to conduct a "binding arbitration" pursuant to the dispute resolution term of the settlement agreement.

On or about September 11, 2002, Bates held "a four-hour hearing" at which Morgan Phillips produced an "actual demonstration of settlement merchandise cut open to reveal that ... the bedding did not conform" to the requirements of the settlement agreement. After this evidence was presented, Bates continued the hearing to October 25, 2002, and "specifically informed the parties at that time that if the parties were unable to settle the dispute before the next scheduled arbitration session Bates would exercise his authority as arbitrator to render a binding arbitration decision. When the arbitration reconvened on October 25, 2002, Morgan Phillips offered "evidence of laboratory testing" showing that the suppliers' merchandise breached the settlement agreement, and also submitted an updated damage study. Bates then gave the suppliers the opportunity to present evidence in their defense. When the suppliers finished, "all evidence had now been submitted to Bates for determination of the dispute. Bates did not request that either side present any additional evidence or to prepare any written statement of the evidence or legal argument. The arbitration hearing was now concluded and the case was now ready for Mr. Bates' arbitration decision."

Bates then "separated the parties into different rooms and [met] with each side separately in an apparent effort to settle the case without rendering an arbitration award. Over the course of next few hours, and until the lunchtime break, Bates shuttled back and forth between the parties to discuss various alternative resolutions. However, as the lunchtime break was ending, Bates suddenly announced, with no lawful justification, that he decided to withdraw as the arbitrator. Bates thereafter failed and refused to issue a binding arbitration award."

Case Excerpt

[Attorney and Associate filed suit on behalf of company in commercial dispute.] The Attorney was listed on the pleadings as lead counsel. Both he and the Associate were listed as the attorneys of record. At the Attorney's request, the Associate handled virtually all the day-to-day work on the matter. The case proceeded through typical phases of litigation. The Associate performed the vast majority of the work on the case and became the Client's primary contact person at the Original Firm. The parties...made various efforts to hold a mediation. Two potential dates were cancelled. The parties and counsel finally agreed to mediate on January 9, 2004, a date the Attorney was not available.

[Meanwhile, the law firm partnership dissolved. The client stayed with the original firm; working with the same associate lawyer. Although still listed as the formal attorney of record on the State Suit's pleadings, the Attorney did no substantive work on the State Suit during the latter part of 2003 or thereafter....the cases settled at the January 9, 2004 mediation; the Attorney did not attend, did not participate in any way, and gave no substantive advice about resolving the litigation. The settlement contained extremely detailed confidentiality terms]. The Associate left the Attorney a brief voicemail message late in the day on January 9, 2004, stating that the State Suit had been settled and that the Company had insisted upon stringent confidentiality terms. As evidenced by a congratulatory email about the State Suit that the Attorney sent on January 14, 2004, to twenty-one employees of the Attorney's New Firm and the Partner's Firm, the Attorney clearly received notice of the settlement, but either did not hear the Associate's voicemail message at all, or did not listen to it carefully, and did not learn of the specifics of any confidentiality terms....[however], the Attorney knew that the Company was highly sensitive about the existence of the State Suit and the claims alleged. The Company made it clear to him personally during the pre-suit and early post-filing negotiations that he conducted with the Company's officers and attorneys that the Company wanted any settlement they might reach to be confidential....

Sometime near the end of May 2004, the Attorney began drafting a press release to announce the settlement of the State Suit ("Press Release"). ...he sought unsuccessfully to obtain the State Suit file from the Partner's Firm and the Associate. The Associate refused to turn over the file, fearing that such an act would violate the Confidentiality Provision that he and the Client had signed but the Attorney had not. This defiance infuriated the Attorney, who sent various intemperate and threatening letters to the Associate and the Client....The Attorney worked on several drafts and eventually instructed his assistant to submit the Press Release to PR Newswire for publication

Case Excerpt

The crux of Simpson's claim against JAMS was that he paid for mediation services in connection with his action in Simpson v. Bank of America (Super. Ct. S.F. City and County, 2001, No. CGC 402367), but that no representatives from the bank attended the mediation and the mediator did not properly conduct the mediation, but rather advised Simpson to "cut his losses short and settle" the case.

The mediation was held on January 3, 2003. Simpson alleges that Best [his attorney] did not adequately prepare him for the process. The mediation began with a session between Best and mediator McDonald, during which time Simpson sat outside the meeting room for more than an hour. Simpson contends he never saw or spoke with a representative of the bank during the mediation. He alleges that when he joined Best and mediator McDonald, mediator McDonald immediately told him that he would not be successful in bringing the matter to trial, that he should "cut his losses short and settle." Simpson further alleges that mediator McDonald continued to voice his opinion on the merits of the case, comparing the suit to a criminal matter in which the police commence an investigation without cause, but discover a dead body in the trunk and succeed in obtaining a conviction. Simpson contends that mediator McDonald then conveyed the bank's settlement offer: waiver of its claim for attorney fees, and payment of each party's $2,400 mediation fee. Simpson refused the offer. Simpson contends that he entered the mediation action with three causes of action, but that when he left, he had none.

Case Excerpt

After caucusing with defendants, [mediator] Mullin received authorization to communicate an offer to [plaintiff] Brooks...

Caucus One (mediator conveys first defense offer)

[Plaintiff’s lawyer] White immediately dismissed the initial offer as unacceptable and indicated Brooks would not respond to it. Mullin also informed White that [insurance representative] Nussbaum indicated he had a reservation on a 2:30 p.m. flight from Omaha [not being available all day was itself a violation of mediation order]. White directed Mullin to return to defendants and "tell them that they had five minutes to put a 'serious' settlement offer on the table, or that [he] and his client were leaving." White did not give Mullin an opportunity to explain the reasoning behind defendants' initial offer.

Caucus Two (mediator conveys second defense offer)

Shortly after relating White's demands to defendants, Mullin received authorization to return to the plaintiff and propose that "Defendants agreed to offer $100,000.00 if plaintiff would then decrease her demand to $425,000.00." White immediately rejected the defendants' proposal stating it was "unacceptable and unworthy of response." Mullin attempted to explain to White that defendants did not value Brooks's claim at the same level White and his client did. However, Mullin did not relate this information to White accurately. In his affidavit, Mullin states: Unfortunately, I mistakenly used the term "authority" rather than valuation, thereby apparently giving Mr. White the impression that Mr. Nussbaum did not have full authority to settle the claim. At that point, White replied to Mullin that defendants were in violation of the mediation Order because it required them to have full authority to settle the claim. Mullin, however, failed to tell White that Mullin had used the word "authority" incorrectly. White advised Mullin the mediation was over and asked Brooks if she agreed to end the mediation. Brooks agreed, and White instructed Mullin to tell defendants he would be filing a motion seeking sanctions against them. White and Brooks then left.

Mullin returned to the defendants and reported that White and his client had left. At that point, defendants indicated to Mullin they would consider filing a motion for sanctions against Brooks based on White's refusal to negotiate. Mullin then told defendants White had indicated he would be filing a motion for sanctions against them. Mullin also told defendants of his mistake in using the word "authority" rather than "valuation" when talking to White.

Case Excerpt

On June 26, 2003, Lisa filed for a dissolution of marriage in Washington. Andrew was properly served in Ohio under the Washington long arm statute. Andrew retained a Washington attorney and the parties hired a Washington mediator.

On December 18, Andrew voluntarily came to Seattle to attend a mediation session. During the mediation, Lisa's attorney served Andrew with a summons and petition for dissolution of marriage.

Andrew concedes that he was personally served in Washington while he was present to mediate this dispute, yet he contends that the service should be deemed void because it was accomplished through "trickery." We are not persuaded....Andrew and his counsel agreed to participate in the mediation knowing (1) that Lisa wanted to dissolve the marriage here, (2) that she had already utilized Washington's long-arm statute to serve him, and (3) that she might serve him personally at the mediation session since Washington law does not prohibit so doing. Accordingly, we find no merit in Andrew's attempt to defeat service by claiming "trickery."

Case Excerpt

This is an appeal from the family court's decision in a rule to show cause hearing regarding the compliance with a divorce settlement agreement. We affirm the trial court's decision declining to enforce the 1997 agreement....

Wife and Husband have been involved in marital litigation since 1993... In 1997, the family court ordered the parties to engage in mediation, and the result of the mediation lies at the heart of the appeal before this Court. The parties agree that, at sometime in 1997, Husband and Wife signed an agreement. Husband gave Wife a check for $5,000. In addition, Husband paid Wife $1,500 per month from 1997 to 2003. The signed agreement was last seen at the mediator's office, and it is unclear what happened to the signed agreement. However, it is clear that the family court never entered a signed copy of the agreement as a result of the 1997 rule to show cause and subsequent mediation. As a result, the agreement is not available for the Court to review.

The parties disagree as to the exact terms of the 1997 agreement. Husband contends that he agreed to pay a sum of $25,000 as full settlement for all unpaid judgments. He testified that $5,000 was a down payment on the sum. Further, he contends he agreed to pay the sum of $1,000 per month for twenty months to satisfy the unpaid debt. In addition, Husband said he was to pay $500 a month in child support. In sum, he contends he was to pay $1,500 a month for twenty months and $500 per month thereafter.

On the other hand, Wife contends that Husband was to pay $5,000 in delinquent child support and $1,500 a month in child support in futuro. To support her claim Wife points out that despite Husband's contention that he would pay $1,500 for only twenty months, he continued to pay that sum for almost five years and noted on the checks the amount was for child support.

Case Excerpt:

Appellant Hypertension Diagnostics, Inc. (HDI) designs, develops, manufactures, and markets medical devices that non-invasively measure blood vessel elasticity, and appellants Mark Schwartz and Greg Guettler serve, respectively, as its CEO and president. Respondent Charles Chesney founded HDI and was employed as its Chief Technology Officer until the termination of his employment in March 2004. Respondent Julie Radosevich was employed by HDI as the Director of Marketing and Reimbursement until the termination of her employment in April 2004. Following the terminations, respondents asserted various "whistleblower" claims against appellants. During litigation of these claims, the parties engaged in voluntary mediation that resulted in a settlement and execution of a "Memorandum of Understanding in Settlement of Dispute" (memorandum agreement). Key terms:

(1) HDI would pay to respondents (a) $85,000 at the time of settlement, and (b) $45,000 within 6 months of settlement execution;

(2) HDI would issue (a) $70,000 worth of stock to Chesney, and (b) $30,000 worth of stock to Radesovich;

(3) that HDI would remove Chesney and Radesovich from the HDI website and corporate communications;

(4) that respondents would return all of HDI's property or business records in their possession or provide an accounting of any missing property; and

(5) that the parties would "exchange mutual complete releases and stipulations of dismissals with prejudice and without costs to any party."

The memorandum agreement was signed by the parties and their counsel. The memorandum agreement includes the requisite advisories required under section 572.35, subdivision 1, and states, "We intend that this memorandum shall bind each of us" and "[w]hile we understand that formal documents will be prepared to facilitate the detail of our agreement contained here, we do not intend our settlement to be dependent upon our agreement as to any such detail, and agree that our agreements contained here are fully enforceable against us." It provides that the parties "agree" to nine settlement terms and that "the dispute has been settled by the agreements contained here and the settlement is not conditioned upon any further agreement."

Case Excerpt

The testimony of Claimant's counsel established that the day after the purported mediated settlement [employer offered $42,500 but only if accepted within 24 hours of the mediation], counsel became concerned because she had not heard from Claimant. When counsel called Claimant and asked what her position was concerning the settlement, Claimant answered: "I don't have any choice." Counsel testified that over her 20 years' experience, she had heard clients comment that they did not have any choice other than to accept the money and settle. Counsel assumed inappropriately that Claimant meant the same thing. Counsel then had decided that perhaps Claimant might do a little better, so counsel arranged to sweeten the deal for her client by asking the employer to pay an additional $552.20 (owed under a prior agreement), whereupon Claimant's counsel told the E/C's attorney that it would be "a done deal."

Subsequently, Claimant asked why she was being asked to visit the office to sign a settlement agreement that she did not want to accept. When counsel reminded her of her prior comment that she did not have any choice, Claimant clarified that she had meant she had no choice other than to turn down the settlement offer because she needed medical treatment, including a spinal fusion, and the settlement proposal would not take care of her needs.

CASE EXCERPT

The final version of the written settlement agreement that plaintiff signed on January 16, 2002, had been slightly modified earlier that day, by deletion of one paragraph, in accordance with plaintiff's express demand. Defendant gave Plaintiff until the end of that day to sign the agreement.

From the Majority: Considering the totality of the circumstances, the court correctly held, by virtue of the parties' six-weeks of negotiations, involving three revised versions of the written agreement (the last of which had been first presented to plaintiff for consideration on January 4, 2002), that plaintiff had been given a reasonable period of time to consider the settlement agreement.

From the Dissent: There is certainly a benefit in requiring the parties to step back from the negotiating table and to ruminate over their final product for a certain period of time. After all, the final settlement agreement in this case was the product of intense mediation that took place over the course of an entire day. Because of the back and forth that results from such a procedure, and because of the potential complexity of settlement agreements, the parties may naturally lose sight of the bigger picture, a problem that is alleviated by Section 626(f)(2)'s mandate of a reasonable period of time to consider the final settlement agreement. Defendant clearly took advantage of the negotiation session that took place on January 16, 2002 to coerce Plaintiff into signing the settlement agreement that day. By threatening to withdraw the final settlement agreement the day that the agreement was reached, Defendant failed to meet the strict requirements of Section 626(f)(2), so that Plaintiff's waiver of his ADEA claims was invalid.