How to Get the Last Dollar out of Mediation

One negotiating tactic that I can share we used today to get some extra money at mediation. But it should be used sparingly and in the right situation.

We were in mediation today and the defense had topped out. After the first offer, it looked like they were going to top out in the $40,000 – $50,000 range. We would be okay with $50,000, but would not be okay with $40,000. As the offers and counters went back and forth, it looked very clear that they were going to top out at $40,000.

My client wasn’t happy about that, but was uncomfortable with going to court and wasn’t certain what to do. He said that if we could get more money than that, he would settle, but couldn’t see settling for $40,000.

But the defense pegged out at $40,000 and wasn’t going any higher.

I asked the mediator if he had a Consent Order of Dismissal in his computer. He said “Heck, Dave. I’ve got a blank one in my folder”. It was perfect. It had the caption and the signature lines of all involved and had a blank for the dollar amount.

I filled in $42,500 and signed it along with my client. Telling the mediator to tell them if they came up just a little, that it would resolve the entire case. And it worked.

I was involved in a mediation with Karl Folkens a few years ago when he did the same thing. I think that used sparingly and in the right situation, it’s a good way to squeeze a little extra out of the case. But I wouldn’t try that early in the mediation or on every mediation.

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One of my favorite parts of being a trial lawyer is negotiating. Getting the other side to pay more than they wanted to. In doing this for nearly ten years, I’ve picked up a few tricks of the trade. I am consistently getting about 20% more for the same case than I would five years ago.

But it’s not something that I can realistically blog about. Let’s say I settle a case for $50,000. Maybe it was a case that I thought was worth $40,000 and negotiated it like crazy and got $50,000 for it. I then blog about it and the other side who thought they  might have done a pretty good job goes “Hey. Dave thought he got over on us….Next time, we’ll have to dig in harder.” Not good for my clients.

Or, let’s say I settle another case for $50,000. I had thought it was a $60,000 case and really, really wanted to get more for the client, but for whatever reason that was all we could get (…and don’t say Allstate). Well, if I blog about that, then people would say “Hey… this situation, Dave let his client get held over a barrel and so I bet we could do it to.” Again, not good for my clients.

And while over a period of time, you can get a pretty good feel for what a case is worth, you never know how much is on the table and whether you got all, or nearly all of it. And when you finish the case, all you can do is cash the check and give the money to your client. You can’t call up and say “How’d we do? Did you hold out on us and make your client happy? Did we settle to easy? Or did we get everything that was there?” Of course, they can’t tell you that, because it would be giving away their secrets just like blogging about negotiating would give away mine. Ah well… some fun stories that can’t be told.

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Practicing Good Faith

Frequently, an insurance company won’t deal with the facts that are presented. They’ll pretend that the facts don’t exist or don’t apply to them. Some of this is posturing, but taken to an extreme it can show bad faith on the part of the insurance carrier.

In dealing with a difficult insurance company it’s important to document what has been done and what the phone conversations are. Some of my friends call this setting the insurance company up for a baf faith claim.

I prefer to give the insurance companies an opportunity to practice good faith. I prefer to document what the situation is and believe that the insurance company will do the right thing. A lot of times they do. Sometimes they don’t. But I find it better to think in terms of giving the insurance companies the opportunity to practice good faith.

If the company will still not do the right thing, then you can still file a bad faith action and everything will be documented, but I try not to assume that the insurance company will not do the right thing if the correct facts are shown to them.

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Be Careful of Ultimatums When Negotiating

The Cat Goes or I Do


When you are negotiating, you want to have a strong position.

However, you don’t want to put yourself in a position where you can’t change your position and don’t have room to maneuver.

You also don’t want to issue an ultimatum that you aren’t afraid to back up.

Sometimes during the negotiating, you will have to reach an impasse and have to file suit or go to trial, but you want to leave yourself an out for further negotiations.

This classified ad shows what happens when you issue an ultimatum and the other party calls your bluff. I’m not certain this is a real ad, but it looks and feels like it is.

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Making Transcripts of Client and Witness Interviews

When putting together mediation packages, I had been using the following method for obtaining transcripts of witness statements:

1. Have Investigator Call Witness and Create a Recorded Statement in Digital Format.

2. Investigator sends Digital Statement to My Office using

3. Transcribe Digital Statement by sending it to

Today, I had an even better idea.

1. Call the witness on the phone.

2. Using conference calling, add as a "third" caller.

What does this do?

You question the witness and at the end of the call hang up. Between 15-30 minutes later, you'll have a transcript of the interview e-mailed to you along with a digital recording of the conversation. You get the automatic recording and the transcript in one fell swoop.

By setting up a conference call with Speak-Write, you eliminate the need to for having the equipment to digitally record the conversation yourself and you eliminate the need to hiring your investigator to take the statement. You also eliminate the cost of the investigator.

You can also use this to take a recorded statement from your client. You can put the phone on speaker and call Speak-Write. You will get a transcribed copy of the interview and also the digital recording in the client's own voice.

Once you have the digital recording, you can use clips of that in your mediation package, to refresh the witness's memory or other uses. Neat stuff.

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A New Way to Settle Workers Comp Cases

I was talking to Karen Shelton a lifecare planner, the other day about a new way she had been dealing with permanent and total workers comp cases. The old model is max out the client as permanent and total and to leave the medical bills open. We would also recommend that the client not file for SSDI until his workers comp case had resolved, not wanitng it to interfere with the workers comp case.

If you do a future costs workup for most of the workers comp clients, the dollar value is so high, that the inusrance company and defense would never pay it. Instead of doing a future costs workup, Karen does Medicare Setaside Allocation, the costs of administering the MSAT, Medicare B costs, Gap insurance cost, supplemental insurance cost, Medicare D costs, plus other prescription or any other costs. This will typically be dramatically less than a future costs workup ($170,000 against $400,000 for a future costs workup). 

Okay fine. What does that get the client? He already had his meds for any work related injury paid for by the workers comp insurance carrier. How does this benefit him?

  • Client is Dealing with Medicare and Not Workers Comp Insurer – Meicare is almost universally accepted and medical providers are used to dealing with them. Some insurance companies are very difficult to work with. (If you’ve practiced in workers comp, you know this is an understatement). 
  • All Injuries or Illneses are Covered –  In workers comp, the insurance company is only responsible for the injuries related to their workplace injury. Once the client is under Medicare, they will be covered for any illness or injury. So while, a person with a failed back surgery might get medical care and pain medications for his back, once they are under Medicare, they can go to a doctor for the flu, a sore throat or a broken arm years after their case is over.
  • Client’s Medicare Expenses will be Covered – Nearly all permanent and total cases will qualify for SSDI. However, Medicare isn’t free. Medicare A is free, Medicare B isn’t. The new prescription plan for Medicare D costs money. There are office visit co-pays, there are prescription co-pays. There are other out of pocket expenses. Your client is going to have to pay these for the rest of thier health insurance, even if their meds are left open for their work related injury. By settling the case this way, all their out of pocket expenses will be covered.

Why would the defense or insurance company want to settle the case this way?

  • It’s Cheaper – They save a few hundred thousand dollars over the life of the case.
  • It Closes the Case – Insurance companies are all about allocating risks. By settling and closing the case, they are eliminating any potential catastrophic costs (future surgeries…).

What are the downsides or caveats? Well the person has to qualify for Social Security. If you settle the case this way and the client is not on Medicare and doesn’t qualify for Medicare, you are doing them a disservice.

Interesting stuff. I believe that Karen is the only one in the country doing this.

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Talk to the Insurance Adjuster

I just got back from the Settlement Institute, a special invitation only seminar on settling cases put on by John Romano. John was gracious enough to invite me to be one of the speakers for the seminar. In exchange, I got to sit through and learn a tremendous amount from some incredible people. If you get the chance to go to this seminar, go. The single best advice was to talk to the the insurance adjuster and send information as you get it.

I have tended to put a big complete package together. All of the medical records, a functional capacity evaluation, future meds workup, supporting medical information, vocational report and so forth. John’s advice was to send the information a piece at a time and let them know what’s coming, even if you don’t have it. Also, if they need information on your client, provide it ahead of time. The adjuster is going to get it anyways, so let them know it’s coming and send it to them a piece at a time. This allows the adjuster a chance to re-evaluate the case as they go and realize that the case is worth more than they initially valued it for. It also allows them to readjust their reserves.

The best line of the seminar belonged to Vincent Leonard of Searcy, Denney, Scarola, Barnhart & Shipley in West Palm Beach. Vincent worked with Allstate for 19 years. He said that they were very familiar with the lawyers who never went into a courtroom. According to Vincent “If you’re allergic to the courtroom. Take some benadryl and get over it”. Good line and good advice Vincent.

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On-Line Focus Groups - Fast and Inexpensive

Last Summer at the ATLA Convention I met Adam Rosen of JuryTest. Adam  has an interesting business in that he conducts on-line focus groups. I was giving a presentation on in-house focus groups a month later and had a case coming up for mediation, so Adam offered to give me a sample focus group on the same case if I shared the information from our live focus group for him to compare. We had a case with strong damages, but we were concerned about liability. The results were rather interesting. The ‘live’ and ‘online’ focus groups tracked each other much closer than I thought they would. Here are my thoughts regarding on-line focus groups:

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Tips for Plaintiff's Attorneys from an Insurance Manager

I had lunch the other day with an attorney who had worked as both a Plaintiff's and Defense attorney and had also worked as an insurance manager, coordinating their large cases. His advice on the high dollar cases was as follows:

Plaintiff's normally leave a lot of money on the table.
The purpose of mediation is to see how strongly a plaintiff's attorney feels about their case. You can't tell the exact problems they have with their case, but you can tell how they feel about their case. An insurance company can tell whether the plaintiff's attorney feels their case is strong or not. Moral: Don't be afraid to walk away from the mediation if you need to.

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