DOHA 2012 Climate Change Conference

The United Nations Framework Convention on Climate Change (UNFCCC) created the Conference of the Parties (COP) in order to get developed and non-developed nations to produce a plan to lower greenhouse gas (GHG) emissions and help prevent global climate change.

Despite recent events like Hurricane Sandy, Doha 2012 COP 18 saw little progress towards a lasting agreement of significant limits on GHG emissions.

No major progress has been made with regard to any of the issues. One of the focal points of this year’s conference has been extending the Kyoto Protocol commitments, which are set to expire at the end of this year. Doha 2012 punted by simply extending Kyoto. The real issue with Kyoto though is how to track and enforce the commitment of different countries. And how to find an equitable solution that will satisfy all stakeholders.

While extending Kyoto is a necessary action, it certainly does not solve our global warming problems. For one, the Kyoto only applied to developed nations, so China, Brazil and India were not a part of any emission reduction agreements. With these nations rapidly industrializing, it is crucial to involve them in some kind of GHG emissions reduction pact. One way is for developed countries to lead with ambitious reduction goals, with the United States participating; something that has not happened up to this point.

Arab countries’ involvement is also critical and many hoped that holding COP 18 in Qatar would help encourage Arab nations to become more involved in climate negotiations. Unfortunately, few Arab nations seem interested. With many of these countries sitting on vast oil reserves with significant solar potential, they have failed to set any targets for solar energy use.

In a recent interview, the U.N. Secretary General said that developed nations should assume most of the responsibility in fighting climate change as historically developed nations have caused the most damage.  While many would not disagree with this assertion, it does not bring the parties closer to an agreement. 

Obviously developed nations are most responsible for our current dilemma. However, developing nations like China, Brazil and India are rapidly industrializing and are now will certainly in the future be a major source of GHG emissions and contribute significantly to global warming. The solution has to involve everyone.  

Assisted by Michael Ciccarone

The NHL Negotiations: Clients Move the Puck Toward a Settlement

The NHL players and owners finally appear to be making progress towards a collective bargaining agreement. Although no formal agreement, public reports indicate that the two sides are having meaningful and productive discussions around many of the critical issues. You might be surprised, though, that this was not thanks to Gary Bettman or Donald Fehr, the lead negotiators for management and the union respectively.

The latest set of meetings was held between six owners and eighteen players – that is between the actual clients and the real parties-in-interest. This, in an effort to build trust and find common ground and perhaps to demonstrate that the players were united. This could be the necessary breakthrough and has appeared to help the parties build some common understandings and develop some of the trust necessary to settle the dispute.

Trust, here as in other negotiated settlement, is the sine qua non of settlement. If the two sides do not trust each other, getting a deal done is going to be very difficult. Meeting without Fehr and Bettman may have given each side enough of an unfiltered understanding of the other side’s needs and interests; enough, in other words, for each party to sense that it understood the other party’s true interests and where that party could – and could not – move. This understanding can give each party a sense of control over the process and remove the public gesturing and posturing from the equation.

There is no agreement yet, but the talks are ongoing; which is half the battle. Hopefully, the ongoing talks and the development of trust will result in a settlement.

At this point, a settlement, almost at any settlement, will benefit the stakeholders, especially those stakeholders not at the table and avoid the train wreck of the loss of an entire season.

The National Hockey League Negotiations: Will Mediation Make a Difference?

As the NHL lockout reaches its 10^th week, it is hard from the outside to see any progress. Both the All-Star game and the Winter Classic have been cancelled and the two sides seem just as far apart as they were three months ago.

But one recent development which should delight hockey fans and ADR professionals alike is that the owners and players have finally agreed to mediation. Both sides have agreed that ongoing negotiations will be conducted under the auspices of mediators from the Federal Mediation and Conciliation Service. 

Although this may not seem like a huge development it is a step in the right direction. The owners and players union have been negotiating for months to no avail. There is hope that with the assistance of the mediator they may begin to make some progress.

Some collective bargaining disputes are very contentious; both parties play “hardball” to get the best deal for their side. They often, as here, resort to lockouts or strikes. Both tactics are designed to put economic pressure on the other party. The problem is that such tactics force the parties into ‘win-lose’ scenarios in part because the high cost of applying economic pressure compels parties to justify the costs of the pressure to their own stakeholders by ‘winning.’

This results in both sides finding it difficult to properly assess the short- and longer-term costs associated with their hardball tactics. To justify the costs and defend their actions to their own stakeholders, the owners and players engage in positional bargaining rather than thinking creatively and seeking solutions. This may be one explanation of why mediation has a lower success rate in collective bargaining disputes than in other arenas; the recent NBA and NFL lockouts are prime examples.

But even if mediation is not successful in the NHL dispute, agreeing to mediation shows that both sides are interested in being seen by their stakeholders and the public as reasonable and willing to negotiate. It shows that the parties are aware of the costs and risks of alienating their own stakeholders. The desire to be seen as reasonable may allow space for the parties, with the assistance of a skilled mediator, to engage in a serious conversation about the issues separating them.

Both sides would be wise to keep the costs of a failure to achieve a settlement in the forefront as they enter into mediation. As the mediators most assuredly will point out many times and in different ways, the costs of not settling will be high, probably higher than the costs of a settlement and will unquestionably end in a “lose-lose” situation. 

Absent settlement, the consequences are likely to be union decertification; litigation; the loss of yet another hockey season; disaffected arena owners and local businesses, subjection to the mercy of judges and, possibly, the permanent loss of hockey’s fan base, without whom, there is no sport.

This is a situation we’ll be following closely. Hopefully both sides will see the merit of mediation and can follow the precedents set by baseball  and other collective bargaining negotiations that have benefited from mediation.

Prepared with Assistance from Michael Ciccarone

Challenges to Environmental Permits in Maryland

In April, I wrote of a change in the Maryland Code that altered the Maryland environmental permitting appeals procedure to give standing to not only those with a direct financial interest in the results of the permit, but to anyone who participated in a public participation process conducted by the Maryland Department of the Environment (MDE).

Well, the Maryland Court of Appeals, in a September 2011 decision in Patuxent Riverkeeper v. Maryland Department of the Environment, et al. has given effect to this amendment by holding that environmental advocacy groups such as the Plaintiff, Patuxent Riverkeeper, can challenge actions by the MDE to grant permits because “its member…had alleged sufficient harm to his aesthetic, recreational and economic interests in connection with the issuance of the non-tidal wetlands permit in issue.” Id. at p. 3

As I previously suggested, and especially now that the Court has upheld this change in the law regarding standing to challenge permits, applicants should consider how to work with local citizens and other interested groups before requesting a permit. Working things out with affected stakeholders can be more cost-effective than litigation and produce better results.

Let's Not Make a Deal: An Empirical Study of Decision Making in Unsuccessful Settlement Negotiations

Do lawyers make reasonable judgments regarding settlement of cases? Many experienced mediators suggest they do not. Plaintiffs can overvalue their cases and defendants often fail to see the risks.

But is there evidence that this is true? Do lawyers and their clients really overvalue their cases and reject settlement offers that are better than awards in the subsequent litigation?

Randall L. Kiser of DecisionSet, Martin A. Asher, Director, Research and Scholars Programs, Wharton Undergraduate Division and Adjunct Professor of Finance at The Wharton School, University of Pennsylvania and Blakeley B. McShane, a graduate student in the Department of Statistics, The Wharton School, University of Pennsylvania analyzed 2,054 contested litigation cases in which the plaintiffs and defendants engaged in settlement negotiations, decided to reject the adverse party's settlement proposal, and proceeded to arbitration or trial.

The study defined "decision errors" as either a plaintiff or a defendant rejecting the other side's settlement offer, going to trial, and finding that the result at trial is financially the same as or worse than the rejected settlement offer—the "oops" phenomenon.

According to this quantitative evaluation of errors made by attorneys and their clients about whether to accept settlement offers or proceed to litigation, the answer is clearly yes.

The parties' settlement positions were compared with the verdict. The study demonstrated that non-settling parties had a high incidence of decision-making errors by both plaintiffs and defendants. As the authors write:

[T]he incidence of decision error for plaintiffs is higher than for defendants, but the cost of decision error is higher for defendants than for plaintiffs….Plaintiffs receiving an award less than or equal to the last offer made by the defendant in 61.2 percent of the cases and defendants committed decision error in 24.3 percent of the cases. Table 1

This data, to me at least, is not particularly surprising. What is interesting is that attorney-mediators make fewer such decision errors.

The study identified attorneys with substantial settlement experience and dispute resolution skills and whether the attorney-mediator represented a plaintiff or defendant in a case tried to a verdict. Obviously these are cases in which the attorney-mediator was simply representing a client as counsel, not in cases where the attorney worked as a mediator.

The study concluded that: “The presence of an attorney-mediator generally was associated with a reduced decision error rate....Regardless of which party is represented by an attorney-mediator, the total amount of error is modestly lower.”

Kiser has written a book, Beyond Right and Wrong about legal decision-making based on this and other studies.

According to the publisher:

The book guides attorneys and clients through legal decision making. It analyzes 11,306 attorney-client decisions in actual cases and summarizes decades of research regarding judge, jury, litigant and attorney decision making. To explain why many litigation outcomes are suboptimal, the book describes the psychological and institutional factors that impede sound decision making. The roles of attorneys and clients in legal decision making and the legal malpractice and disciplinary consequences of ineffective legal representation also are discussed. To rapidly promote better financial outcomes in civil litigation and to assist attorneys and clients in becoming expert decision makers, the book presents more than 65 ideas, methods and systems for improving personal and group decision making.

More about Public Negotiations

My last blog was about a Washington Post article about the lack of competence we see in public negotiations.

F. Peter Phillips who writes the always interesting Business Conflict Management blog has noticed this as well. As he points out, “as formal training in private negotiation increases, the quality of public negotiation has fallen into such disrepair.”

Negotiators of all types are trained, first of all, to listen and to understand interests. Yet, as the Post article and Phillips both point out, listening is the one thing that appears to be missing from the public dialogue. And when have you seen politicians try to accommodate other interests while still addressing their own?

As Phillips asks, why? And is this something to which the ADR practitioners might speak? Well, yes.

A panel discussion at the American Bar Association Dispute Resolution Section 13^th Annual Spring Conference asked professional negotiators about poor public perceptions about political negotiations.

According to Phillips, Peter Adler of the Keystone Center asked that people recognize the true nature of the issue:

These are discussions of “public interest,” not private “interests.” It is the exercise of collective power. These talks are reported on the TV. It is not two parents negotiating child custody. Waiting for a moment of consensus in a legislature is like waiting for the exciting bit at a baseball game. It will come, but it will be unexpected and without any impact on the way the game itself is played. That’s why “Town Hall meetings are not a good forum to solve problems.” There is a role for the creative leader in public discourse, just as there is a role for the creative facilitator in the divorce discussion. But importing terms like “interest,” “collaboration” and ”facilitation” from the private sphere to the public one is inartful and displays a lack of sympathy with the process of public policymaking. (Emphasis added).

John Ferrugia, a guest panelist who is a veteran legislative reporter, noted an important distinction: Negotiators have an incentive to reach an agreement, while legislators have an incentive to retain their seats. Negotiators rely on their counterparty to seek shared interests, while legislators rely on their constituencies to get money to be re-elected. Can a legislator afford to break with the party on a budget issue? Is centrism viable when the funders are on the extremes? Is the process of politics rational? (Source: Business Conflict Blog)

Of course the process of politics is not rational. We shouldn’t expect otherwise. Politics is a reflection of us – including, or perhaps mostly – our irrational selves.

The Council of the Dispute Resolution Section adopted a resolution, introduced by Richard Reuben, for consideration by the ABA House of Delegate at the ABA Annual Meeting in August. The Resolution provides:

RESOLVED, that the American Bar Association reaffirms the principle of civility as a foundation for democracy and the rule of law. When dealing with the public as well as with one another, lawyers should set a high standard for civil discourse as an example for others in resolving differences constructively and without disparagement of others.

FURTHER RESOLVED, that the American Bar Association urges all lawyers, ABA member entities and other bar associations to take meaningful steps to enhance the constructive role of lawyers in promoting a more civil and deliberative public discourse.

FURTHER RESOLVED, that the American Bar Association urges all government officials and employees, political parties, the media, advocacy organizations, and candidates for political office and their supporters, to strive toward a more civil public discourse in the conduct of political activities and in the administration of the affairs of government.

FURTHER RESOLVED, that the American Bar Association supports federal, state, territorial and local governmental policies, practices, and procedures that promote civility and civil political discourse and that are consistent with the First Amendment, and other federal and state constitutional requirements.

Given that lawyers don’t a reputation for civility, is this not lawyers living in glass houses throwing stones? For example, see my blog Lawyer Jokes.

I wonder if this resolution will make any difference whatsoever.

As my children say, the most interesting political discourse no takes place on the Daily Show with Jon Stewart and Colbert Nation with Stephen Colbert.

Battle over national debt ceiling has negotiation experts shaking their heads

The May 11, 2011 issue of the Washington Post had an interesting article by David A. Fahrenthold that looks at the political negotiations over extending the national debt ceiling.

Published in the Post Style Section, the article says a lot about our culture’s adoption of the ideas in Getting to Yes by Roger Fisher and William Ury.

The article reviews the negotiating styles of politicians and concludes that they are, in a word, amateurs, to wit:

That’s the frustrated conclusion that America’s professional negotiators have reached, after watching Washington’s politicians begin their own negotiation over the national debt ceiling. These professionals are ex-FBI agents, labor mediators, divorce counselors. They have learned the rules that help resolve unsolvable standoffs: Don’t lie to a man on a high ledge. Don’t box yourself in with sweeping threats. Don’t tell your adversary to “act like an adult.”

And it bugs them to see their art practiced this way.

I believe that many of us, observing the posturing and lack of negotiations skills we see between political leaders every day, agree with the main thrust of the article -- that both sides “have no idea what they’re doing.”

This bothers me. My guess is that one of the reasons both parties are held in such low regard is that most of us understand that effective negotiations require a level of professionalism that the politicians don’t often meet. Political leaders have a lot to learn about negotiations strategy. Too bad they don’t seem to be paying attention.

Bill Ury was quoted in the article as saying, “The country deserves better negotiations.”

How true.