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Over the last few decades, most courts have begun requiring parties to attempt mediation, or other forms of alternative dispute resolution (ADR), at various stages in the litigation process. The mediation process is very effective at resolving disputes as it forces the parties to realistically evaluate their positions, then, weigh that against the risk of success.
So if mediation talks break down or one party wants out, what happens next? Below you'll find some important information on what to do after a mediation session fails.
When mediation fails, a party to a lawsuit may be left thinking: "Well, that was a waste of time, what's next?" After a court-ordered mediation, the parties must report back to the court that ordered them to attempt mediation. Then, usually, the court will ask if the parties want to try again. The court will also review the case's schedule and confirm with the parties that they are on track to go trial as planned. Depending on when the mediation occurs, a case will resume being litigated.However, just because mediation fails, that does not mean a case will never settle. Many times, cases must go through more than one or two rounds of mediation, and the issues and suggested resolutions that get raised during a mediation can form the basis of a later settlement.
Reevaluate Your Position
When preparing for mediation, the parties usually will exchange evidence and statements supporting their respective positions. This exchange, as well as the discussion that occurs at a mediation session, can help inform each party's view of the case. After a mediation session, it is important to reevaluate your position based upon what you have learned. If the other side presents a piece of "smoking gun" evidence at mediation, that may require rethinking the entire trial strategy.
Try Again, and Again, and Again
Although mediation can be costly, trials are almost guaranteed to cost more. After a mediation session fails, a settlement can still be reached. It is not uncommon for parties to attempt mediation more than once, or attempt to use more than one form of alternative dispute resolution. As such, a failed mediation can be very helpful in preparing for future mediation sessions, judicial settlement conferences, and even just informal settlement negotiations.
Get Ready to Litigate
When mediation fails, parties can often view the failure as a catalyst to turn up the heat on the litigation and trial preparation. Parties should be ready to do more discovery (fact-finding), and to file or defend motions. Some cases may even end up going to trial.
Caution: Beware Mediation Confidentiality
Parties should be cautious about information learned from the other side during mediation. Most mediation sessions are conducted confidentially, and federal and state laws prohibit the use of any information learned in mediation from being used in court. However, this confidentiality does not mean the information can never be used, it just means that the source of the information must come from somewhere else besides the mediation.