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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
wrong and must immediately cease and desist - - or else!
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”.
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