The value of an appellate perspective in mediation

One of the most important questions in the mind of an attorney going into a mediation is, “What is the likely outcome if this case goes to trial?” This is clearly an important consideration. But an equally important and often overlooked question is, “Even if I prevail in the trial court, what is the likelihood of the judgment being reversed on appeal?”

Value of an appellate perspective in a post-judgment mediation

Post-judgment mediations are more common than most attorneys might guess, given that one party has a victory in hand; they are also more successful than most would think. While I was on the Court of Appeal, my colleagues and I conducted a number of settlement conferences in cases pending appeal, on request of the parties, and were able to settle most of those cases. Many other cases settled on their own while an appeal was pending, resulting in dismissal of the appeal. Experienced attorneys are aware that victories in the trial court can be, and often are, short-lived. A mediator with experience as an appellate judge knows this and is in a unique position to assess, based on having reviewed thousands of post-trial judgments and summary judgments, whether a judgment is likely to be upheld on appeal.

Even after obtaining a favorable jury verdict or other judgment in the trial court, uncertainty looms when an appeal is pending or is likely to be filed. If there were, for example, errors in evidentiary rulings or in jury instructions, there may be a not insignificant chance of a reversal on appeal. However, in my experience, attorneys are often over-confident about their chances of prevailing in an appeal; they are at times so invested in their cases that they are unable to objectively assess the merits of the position of the opposing party. In addition, many attorneys think that any error in the trial court will result in a reversal without fully considering whether the error was prejudicial. A mediator with appellate experience is in a better position than most to assess whether a claimed error will be deemed prejudicial and therefore, reversible. Because of the risks inherent in an appeal, attorneys should consider going to mediation at this stage of the proceedings to avoid the possibility of having to retry the case – or worse, of having judgment entered against their client. A successful mediation at this stage of proceedings also enables the parties to avoid the expense and delay in finality caused by the filing of an appeal.

The same is true post-summary judgment. A mediator with significant appellate experience is in an excellent position to evaluate the likelihood that the summary judgment will be upheld on appeal and thus, whether the attorney would be wise to consider trying to settle the case, even with a summary judgment in hand.

In my own mediation practice, I have found my experience on the Court of Appeal to be invaluable in facilitating settlements in post-judgment cases. In one post-judgment mediation, the plaintiffs had obtained a multi-million-dollar judgment at jury trial against a defendant for personal injuries sustained as a result of the defendant’s negligence. After reading the pleadings and the trial court’s order on the motion for a new trial, as well as the parties’ mediation briefs, I was able to evaluate each of the potential appellate issues and explain to the defendant and his attorneys that, given the applicable standards of review and the state of the evidence, reversal was, in my view, very unlikely.

It took some time to go through each issue and explain my analyses, but through this process, it ultimately became clear to the defendant that settlement was in its best interests, particularly considering that interest was accruing at a rate of more than $1,000.00 per day. As to the plaintiffs, while they had a judgment in hand and their attorneys were confident that they would prevail on appeal, the plaintiffs ultimately concluded that they would prefer to settle the case at the mediation and receive payment in a matter of weeks rather than wait two years or more to collect once the appeal was final.

In another post-judgment case in which the appellate briefing was complete, the plaintiff had won a multi-million-dollar judgment at jury trial against her former employer for various FEHA and tort claims based on sexual harassment, retaliation, and wrongful termination. After reading the parties’ appellate briefs and evaluating each issue raised, it was clear to me that both parties faced potential risks on appeal. My ability to analyze each appellate issue with the parties and explain the standards of review and the parties’ respective risks on appeal enabled each of them to more accurately assess their respective case. Both parties ultimately concluded that settlement was a better alternative than proceeding with the appeal.

Value of an appellate perspective at earlier stages in litigation

An appellate perspective is also advantageous to a mediator at earlier stages in litigation. As a U.S. Magistrate Judge, prior to my appointment to the Court of Appeal, I conducted hundreds or possibly thousands of ENE (early neutral evaluation) conferences, which are held, as the name implies, at an early stage in a case, usually after a complaint and answer have been filed but before any substantial discovery has taken place. Based on this experience, I know that mediating a case at an early stage in litigation will often result in a settlement.

Having since served as an appellate judge for 20 years, I can say that having an appellate perspective at this early stage in a case is a definite plus for a mediator. A defense attorney might believe that the trial court will sustain a demurrer to the complaint without leave to amend. However, because I have ruled in appeals of numerous judgments following orders sustaining demurrers without leave to amend, I know that, while the majority of such judgments are affirmed, a significant number are reversed, almost always on the ground that the plaintiff could amend the complaint to sufficiently allege a cause of action. Trial judges sometimes believe that they know how a case will end, i.e., that the plaintiff will lose on summary judgment or at trial, and this may cause them to sustain a demurrer without leave to amend when the reality is that the complaint sufficiently states a claim. A mediation conducted very early in the proceedings – i.e., even before the filing of a demurrer or while a demurrer is pending could enable the parties to avoid the time and expense of the demurrer proceedings, the delay caused by a possible appeal of a ruling sustaining the demurrer without leave to amend, and the expense of further litigation in the case.

A mediator’s experience as an appellate judge can also be helpful to the parties in mediations conducted after discovery has been propounded and responded to, but before a summary judgment motion has been filed. Having ruled in hundreds of appeals of summary judgments provides the mediator with a broad base of knowledge that enables the mediator to better assess the strengths and weaknesses of potential summary judgment motions. Going to a mediation at this stage of litigation could save the parties the time and expense of filing and responding to a summary judgment motion, possible delay in the litigation caused by the trial court’s crowded calendar, as well as the potential expense of an appeal and further litigation.

Many cases come to mediation with a motion for summary judgment pending. In those cases, the question in an attorney’s mind is whether the attorney is likely to win or lose the motion. An additional risk that is often not considered is whether, if summary judgment is granted, the ruling will be upheld on appeal. Like judgments entered after the sustaining of a demurrer without leave to amend, the majority of orders granting summary judgment are affirmed on appeal. However, in my experience, rulings granting summary judgment are reversed significantly more often than other types of orders in civil cases. The error usually involves the trial judge improperly weighing the evidence and/or making credibility determinations. An appellate perspective allows the mediator to better assess the ultimate outcome of a summary judgment motion, and thus, the risks of moving forward with the litigation.

I recently had a mediation in which the defendants were prepared to file a motion for summary judgment raising three separate grounds, each of which would support granting judgment in their favor. Because of my experience reviewing hundreds, or possibly thousands, of summary judgments at the Court of Appeal, I was able to evaluate each of the defendants’ arguments and explain to the plaintiff why it was likely that the trial court would grant the motion for summary judgment. I further explained that even if the trial court did not grant the motion, the defendants were likely to ultimately prevail if the case were appealed. After the case settled at mediation, the plaintiff’s attorney told me that my analysis and explanation of the legal issues was instrumental in enabling the plaintiff to realistically assess his options during the ensuing settlement discussions.

Having adjudicated hundreds of appeals involving trial courts’ sustaining of demurrers without leave to amend and grants of summary judgment, and thousands of jury verdicts and other types of judgments, I know that my experience as an appellate judge has provided me with the ability to more accurately assess the likelihood of judgments ultimately being affirmed or reversed. This experience is extremely valuable in the course of gaming out, at any stage in litigation, the likely ultimate outcome if the case were to proceed – a critical consideration in any mediation.

Judicate West understands the value that neutrals with extensive appellate experience can bring to mediations and other types of proceedings. In recognition of the increasing demand for neutrals with appellate experience, Judicate West has recently formed an Appellate Practice Group comprised of former federal and state judges with deep appellate experience who are available to serve as neutrals in case evaluations, mock oral arguments, reviews of appellate briefs, writ issues, opinions, petitions for rehearing reviews, and mediations.