The use of brackets in negotiating a settlement needs no explanation here. It is clearly an important tool in a mediator’s toolbox. But if and when a mediator should resort to bracketing, is a different matter. Its use depends on the circumstances of each case. Introducing brackets too soon can prove to be a distraction, and kill momentum toward a settlement. It should be used judiciously, and only when a) there is no other viable alternative, and b) the mediator already has a grasp of the range in which the case will likely settle.
There is no substitute for evaluative and substantive mediation. A successful mediation is critically dependent upon assisting parties achieve a frank and fair assessment of the strengths and weaknesses of their case, the costs attendant upon further litigation (including management distraction), the basic uncertainty inherent in our judicial system, the possibility of successive appeals, the cost of money, the incompatibility of litigation with vindication, collateral public relations and precedent issues, and the personal emotional toll litigation imposes on parties and witnesses. Attempting to short cut the intellectual and emotional analysis, understanding and reluctant acceptance essential to any settlement, is doomed to failure.
But sometimes, brackets do serve a purpose. This typically occurs when the parties start at opposite ends of the spectrum, and each side proposes only small incremental steps toward a solution for fear of being seen as weak. A good mediator is typically able to stop the minuet and move discussions forward in a meaningful way. If the dance continues too long without substantive progress, each side tires, tempers can flare, and accusations of bad faith can fill the air. You may reach the stage when one party refuses to make a counter offer because it believes the latest demand to be wholly unrealistic or in bad faith. This can lead the mediator to ask what number would merit a counteroffer. Thus can begin the process of bracketing.
When discussions approach this point, bracketing may be attempted, but it must be done carefully, and only when the mediator has a fuller conception of what each party’s true settlement position may be. The mediator should test potential ranges in ex parte sessions as part of this process. In short, the mediator should have some sense of what range would be acceptable to both parties before moving forward.
A party may resist the use of brackets because it is concerned that agreement constitutes implicit acceptance of a settlement at the midway point. But a party can send a clear message that its agreement to a bracket should not be misinterpreted. This can be reinforced by the moves that party makes once the bracket has been accepted. The mediator plays an important role in communicating the caveats and conditions to any bracket so that there is no misunderstanding on either side.
If a mediator resorts to bracketing, my own experience is that its success will be enhanced if it is done without attribution. Once the mediator has some comfort in the numbers to be used, the bracket can be separately proposed to both parties, with the understanding that if one party does not agree, the non-consenting party will not be told its adversary had accepted it.
Joe DiBenedetto recently retired from Winston & Strawn LLP, after spending 46 years in its Manhattan office as a capital partner specializing in commercial litigation. He formed JDB Mediation LLC to further develop his mediation and arbitration practice, which is centered in Manhattan and its surrounding counties (including Westchester, Nassau and Suffolk). Joe DiBenedetto’s experience, training, and other credentials are more fully described at www.JDBMediation.com