REAL DISPUTE RESOLUTION

Author Richard Solomon is a conflicts and crisis management lawyer with 50 years of experience in business development, antitrust and franchise law, management counseling and dispute resolution including trials and crisis management.

Forty Five years experience as a business litigator have provided me ample opportunity to analyze the anatomy of dispute resolution. Not long after I realized that I would be involved in trying lawsuits and handling arbitration proceedings on a rather regular basis, it occurred to me that there are many points along the disputatious road at which some good sense could have produced practical resolution with at least rough justice. Yet these points seemed almost always to have been missed. Rough justice is real justice because it approximates what an unbiased third party is likely to decide anyway and everyone gets some of what they want but not all of it.

It could have been that these points are not missed as often as I think. People who did not become my clients might have been more intelligent than those who did become my clients. These more astute people may well have seen the progression of hostility and ego gratification more insightfully and made wise decisions not to allow that to happen. I can only speak from my own experience. That experience has been for the most part as lead counsel or as the consulting expert, either on the subject of the dispute or on how to handle the dispute.

Most people think of dispute resolution in terms of the available procedures – litigation, mediation and binding arbitration. Looking back that seems somewhat like thinking of symphonic music in terms of the sheet music. To be sure, there are people – and we all know someone like this – who are so ego driven, so aggressive, that they really believe that it is better practice to develop a reputation of major, implacable predation. They can afford to sue anyone for anything and to provide the lawyering resources out of pocket change. One such group recently spent $ 16,000,000 finding out from their own lawyers that they had no case – who should have known the most probable result in this case $ 15,965,000 ago and communicated that to their client.

Only a real nut job spends that kind of money to be told by supposedly competent lawyers that he/they had no case to begin with. The law firm was an extremely prominent large firm that had to have known better. I am certain of this because just two years prior to that I had an almost identical case against the same opponent and prevailed in mine for a grand total of under $ 1,000,000 in fees and expenses.

The large law firm milked it to death for as long as they could before telling the client they could not win. Their client had been told by my client about our victory in the same situation, and urged to use our team. They had to have the “big firm” treatment, and…well…they got it.

But these kinds of crazy situations rarely arise. Few are so utterly stupid as to spend $ 16,000,000 on nothing more than ego – unless maybe some large publicly held company where the decision makers are spending money that belongs to anonymous shareholders whose real interests are secondary to executive arrogance. There really is no other explanation for this kind of event.

If you are not ultimately arrogant and ego driven, dispute resolution can be managed much more effectively in its result and in its cost.

There is one eternal constant in dispute resolution. The earlier I can get to you, the more likely it is that the deal can be saved and, if not, that getting past it can be facilitated.

As soon as a deal starts to come apart, or some infringement of rights is perceived, the wrong things are done. Usually your law firm advises you, if you tell them you have already tried to do the right thing and been rebuffed (which is what every client always says to its lawyers), that some kind of “notice” needs to be sent out immediately. The notice says either that the opposite party is in default or that the opposite party is doing something

The problem is that the client only thinks that a resolution attempt has been made and rebuffed. If the client has not already called the other party everything but a child of God, and everyone is not already manning the barricades, there are conciliatory approaches still available that do not blow any tactical advantages. You can always send out the Go To Hell notice later. There are ways to finesse drop dead deadlines that are almost never used.

In truth, it is always the case that deals are seen to be coming apart very early on. That is when expert dispute resolution resources can most effectively be used. Expert dispute resolution resources are not always those who advocate WW III. WW III always costs the most and WW III is one hell of a money maker for any litigation firm.

It may well be that while you are willing to consider a more rational approach, the other folks are just spoiling for a fight, and the fight cannot be avoided. But most of the time, in my experience, both sides would love to find a face saving way out of the coming mess other than a fight to the death. The earlier on that outside the envelope techniques are brought into play, the more likely it is that success is available on rational terms.

Where the issue is not that a deal is coming apart, and there is some invasion of rights by some third party that could not have been foreseen, there is still a tactically safe way to approach it that no one seems to use. Illustratively, I once knew Robert Barton of Parker Brothers Company, the publisher of the game Monopoly. One evening over dinner at The Plaza in NYC he told me that they had encountered people who wanted to knock off the Monopoly game several times in the past and who they had simply talked out of it. The gambit he used was simply that he said to them that while Monopoly was wildly successful for Parker Brothers Company, once it was successfully knocked off it would become worthless. The infringer could ruin it for Parker Brothers but he couldn’t expect to make any money off it down the road. This had worked for them on several occasions. To be sure, his manner of delivering that message played some part in its effectiveness.

After Parker Brothers had been acquired, there actually was an attack on Monopoly. The IP lawyers’ advice was to fight. The new owners did not have any money problems. They had deep pockets and could pay for the litigation out of pocket change. Their lawyers had not, however, correctly done their homework, and a federal court decided that the game was not protectable. The name might be protectable, but the game itself was not, and could be knocked off using other similar names. And so, Anti-Monopoly was exonerated. Monopoly did not become worthless, and it is likely that at some point it would – like any product – lose its luster anyway. The story, however, illustrates how Mr. Barton’s intuitive genius brought nontraditional thinking into play to extend the life of a then incredibly valuable product. Infringement/invasion of rights conflicts can often he headed off at the pass or at least made less painful when resources with different approaches are called in at the earliest possible moment. That is the point of the story.

Even if that first moment opportunity is lost, there are probably still opportunities to sort out differences much earlier than the customary experience and for far less expense. On over a score of instances new clients have come to me complaining of huge monthly legal expenses that are accomplishing nothing, and there was – except that no one was interested or able to find it – a better way out of the mess. I have often been able to bring an end to hostilities within a month using approaches that – after the fact – seemed so obvious that everyone couldn’t believe they had not done it that way in the beginning.

Each case is different. The parties are usually not that different in attitudes. The main difference in cost of resolution is really how early on I have had a chance to try to get the dispute into a different mode. The best dispute resolver is really a seasoned litigator with insights into the realities of the situation who doesn’t think he has to get stinking rich on every case that comes into the office.

The value of a real good dispute resolution reputation is not in always going to trial, unless the client is an idiot. The value of a real good dispute resolution reputation is in ending the dispute on terms that people can live with at the earliest possible moment. The longer disputes continue, the more likely it is that they will produce nothing good for any of the participants. Winning – whatever that means – is fun for the lawyers. I know. But living well is really the best revenge. Getting past the fight and getting on with a productive life, free and clear of conflict, is far more valuable in almost every instance.

I have worked with clients who had more money than God and who thought that the world worked better for them if everyone knew of them as companies that could and would spend vast fortunes to get their way. I know that mentality. I have also worked with folks who were spending their own money and wanted and needed a more sensible approach. Sometimes it is simply not possible to avoid a fight to the death. But usually that is not so. Superior options may seem at first somewhat distasteful, but, when thought out properly may be seen for their superiority. Just keep saying to yourself “Living well is the best revenge”.