Appellate Mediation: Embracing a Pragmatic Approach

by Mark Ritchie, Law Office of Mark Ritchie, P.C.

Ah, the docketing statement. The series of simple requests for discrete information seems less like work, and more like the professional equivalent of a crossword puzzle, stimulating and providing a sense of accomplishment without being too taxing. Filling in the requested names, dates, and other specifics is an agreeably simple exercise, at least for a while, and then the imponderable question rears its ugly head:

“Should this appeal be referred to mediation?”

The transition from easy recitation to deep strategic consideration is jarring, to say the least. Gone are the questions that have simple, objectively correct answers, and in their place is a vastly more difficult question, one that demands we carefully weigh the relative bargaining positions of the parties against an endless succession of subjective considerations and provide . . . an educated guess. Yuck.

Still, there’s little use in complaining about it, as mediation on appeal is met with increasing favor, especially here in the Houston area. Rather than cringing with uncertainty, each of us needs to make ourselves comfortable with how to evaluate the likelihood that mediation will be successful for any given appeal. To that end, I have worked to provide in this article a broad stroke sketch of the most common issues, together with a few pointers and rules of thumb I find particularly useful. Little has been written on this subject so far, and my hope is that this article will prompt serious consideration and discussion.

Is the Appeal Appropriate for Mediation?

The principle objection to mediation on appeal is that, in the vast majority of cases, one party has overweening bargaining power because of the judgment in their favor. The party who prevailed at the trial court level may be seen as holding all the cards, with little motivation to change position or grant any concessions whatsoever. How can mediation or, for that matter, any meaningful negotiation take place when that party has no motivation to come to the table in the first place?

The reality, though, is that a measure of insecurity accompanies even a seemingly airtight trial court judgment. Assuming for the sake of argument that there are legitimate grounds for taking an appeal in the first place, then there is significant risk of the judgment being altered in some way. Without getting into case-specific analysis, the statistics for the 2015 fiscal year are that 37.4% of all appeals filed in the courts of appeals were disposed by reversal, modification, or “Other” disposition. Obviously, each case must be evaluated on its own merits, and merely filing an appeal doesn’t mean its ultimate decision boils down to a statistical roll of the dice. The statistics quoted here merely illustrate the broader principle, that a party who prevails at the trial court level shouldn’t be so quick to rest on its laurels, discounting the possibility that this would mean snatching defeat from the jaws of victory.

Furthermore, the prevailing party does not have the luxury of only considering the risk that the judgment may be overturned; it also has to consider real world risks having no direct relation to the merits of the case. Financial resources have already been depleted in obtaining the judgment, and most parties will want to consider how much in the way of additional resources they are willing to commit to defending the judgment on appeal. Even parties who have a more or less inexhaustible ability to finance litigation may prefer immediate resolution at a modest discount. Fatigue and frustration may have already taken a significant toll, and the party’s desire to continue the fight has to be weighed against reaching final resolution of the matter through litigation at a distant future date.

Turning to the appellant’s perspective, mediation is almost certainly going to be an attractive option from the outset, especially when the appeal will be decided under a deferential standard of review. Even so, due consideration must be given to the likelihood of modification or reversal, and how the odds of reaching a desirable settlement may be served by mediating before or after briefing is complete. For example, if error is particularly evident and egregious, the appellant may want to wait until after briefing is finished and explore the possibility of settlement, provided that the cost of posting a supersedeas bond or alternate security is not an overweening concern.

For both sides, it may also be important to consider the long-term implications of pressing forward instead of working toward a negotiated settlement. If the parties anticipate future business dealings, for example, there may be additional pressure to smooth things over sooner rather than later and avoid the risk of long-term damage to their ability to work together. Similarly, the parties may be well advised to consider whether this appeal is the right vehicle for establishing favorable precedent for novel or unsettled legal issues likely to be important to pending or anticipated lawsuits affecting their respective interests. Both appellant and appellee should also make a point of looking for similar cases winding their way through the appellate process ahead of them that may cause significant shifts in the legal landscape.

Cooler Heads Must Prevail

While cool, logical consideration of the parties’ available options seems most sensible for all concerned in the period between judgment and appeal, in practice it seems much more common for emotion to play a significant role. Those on the prevailing side at the trial court level are understandably exuberant and proud of their accomplishment, and are often reluctant to consider the possibility that their victory may be a fleeting one. Likewise, those on the other side typically may be deflated or angered by the loss, and the losing party may also be overwhelmed by a sense of desperation if the judgment carries a risk of economic ruin. Both sides are heavily vested in the outcome, and are likely preoccupied to some greater or lesser extent with their sunk costs in the litigation to date.

In sharp contrast, our job when we are brought in to handle an appeal is to look at the case with objectivity and precision, which is facilitated by our status as newcomers lacking a personal investment in its outcome. Unfortunately, this may foster hostility on the part of trial counsel, who may resent our questioning of their objectivity, both as to the merits of the case and the quality of their own work. Left unchecked, this may prompt a breakdown in communication, or worse still an openly antagonistic relationship with trial counsel that interferes with our ability to confidently assess the strengths and weaknesses of the case.

Regrettably, no one strategy can manage every possible complication, meaning appellate counsel may spend a significant amount of time providing reassurance, answering questions, and reigning in conflict, depending on the particular mix of personalities involved and the immediate needs of the client and the case. While this may be taxing, it also serves to educate you on the specific contours of your client’s ability to understand the legal issues and willingness to tolerate uncertainty, while at the same time learning what you can from trial counsel about the tenor of any settlement negotiations that previously occurred. Tact, diplomacy, and inquisitiveness will serve you well in this, giving you an opportunity to develop a clearer understanding of whether mediation is likely to succeed.

We’re Going to Mediation? Great! With Whom?

Once the decision is made to go to mediation, the parties still have to agree on the mediator. Fortunately, there is legitimate consensus on who constitutes the best choice. In most situations, the parties’ first choice should be either an experienced appellate practitioner or former appellate judge, so that the mediator has a solid understanding of the procedural and substantive issues most likely drive the decisionmaking process of the court of appeals. See, e.g., Hon. Jeff Kaplan (Ret.), Practical Considerations for Post-Trial and Appellate Mediations, 64 THE ADVOC. (TEX.) 71, 72 (Fall 2013) (noting that “at a minimum, the mediator should understand the applicable standards of review and the substantive law”). This quality is considered indispensable, as he or she will have to push the parties toward resolution by commenting directly on the merits of the case and openly challenging the legal arguments advanced by the parties in support of their respective positions. See id. (encouraging the selection of former appellate judges and experienced practitioners who have “the credibility needed to encourage both sides to realistically assess the risks . . . and negotiate in a meaningful way”); see also D. Todd Smith, Using the Evaluative Approach in Appellate Mediation, TEXAS APPELLATE BLOG (July 31, 2016), http://www.texasappellatelawblog.com/2016/07/articles/mediationadr/evaluative-approach-in-appellate-mediation (discussing the evaluative approach as potentially superior to the facilitative approach for appellate mediations).

While the choice of an experienced appellate lawyer or former appellate judge is preferable for most appeals, though, care should be taken not to let this result in the alienation of parties or their counsel. The more direct and confrontational approach may make one side feel it is at a disadvantage and is being bullied, especially when the party on that side is not represented by seasoned appellate counsel. If there is a substantial disparity in the sophistication and experience of counsel on each side, then this should be taken into account at the time a mediator is selected, and care should be taken to choose someone who can diplomatically and respectfully speed the parties toward an agreement that suitably reflects the merits of the case.