Scorched-Earth Scenarios

The Great Toilet Paper Apocalypse of 2020 is now firmly in our rearview mirror, but that doesn’t mean the trucking industry can sleep easy. From driver shortages to supply chain issues, those in the transportation industry face unique and difficult challenges every day. The same is true in claims and litigation management. Here’s an example.

If a safety department for a motor carrier labels a wreck “preventable” under the Federal Motor Carrier Safety Regulations, it is possible that a truck driver could be terminated by his employer, even if that driver feels he otherwise was not responsible for causing the accident. It is one thing to have a defendant who is difficult, uncooperative, or even borderline hostile, but have you ever had a client who was downright combative? Who not only was obstructive, but also was actively trying to sabotage a case?

A real-life situation like this occurred for us involving a terminated truck driver who voiced feelings of hatred for his former employer, all lawyers, and his former employer’s insurance company. The driver said that all of them deserved to have a judgment against them, so he was not going to tell us if he was served with process in the personal-injury case that was just filed by the plaintiff’s attorney. Scary, right?

What do you do in a situation like that? You immediately set the case for mediation.

From a mediator’s perspective, a circumstance like this could play out in any number of ways, although it’s important to note that every case is different, and the course of action may vary depending on the specific, unique circumstances. But in the scenario presented, consider re-thinking the typical approach to mediation using the following strategies.

A “mediation within a mediation” is a helpful approach. If there is concern that a former employee may taint a lawsuit or mediation with his testimony and participation, then it may be important to address the issues generated by the former employee before tackling the larger third-party case. Consider rehabilitating or isolating them to the extent possible.

In terms of rehabilitating, one may consider a “mediation within a mediation.” Rather than contacting the former employee directly, consider asking a mediator or other liaison to reach out to the individual in an effort to initiate a discussion. Parties will often respond much more favorably to a neutral than they would if contacted directly by the person or company with whom they are aggrieved.

It is also important to address the underlying relationship and look at the situation from the varied perspectives of all the players. For example, is it understandable that a driver is upset for what he sees as being subjected to an unjust termination? Of course. Perceptions of how we are being treated frame our emotions, and emotions drive actions. Seeing things through someone else’s eyes may not, in and of itself, improve the employer’s situation with the underlying litigation, but the recognition may serve as a good foundation for improving the situation. Even though an individual may no longer be receiving a paycheck, there is still a relationship with the employer, and managing relationships requires effective communication. If you want someone to change his position or behavior, you have to create favorable circumstances and emotions for him. People won’t consider doing what you want until they feel they have been heard and understood. Until you verbally acknowledge someone’s position, he won’t hear you. So, to mitigate the impact an angry former—or current—employee may have on a liability case, address the underlying relationship to the best extent possible.

Best practice is to vary the mediators, but if this isn’t possible, consider using different mediators to facilitate the conversation with the former employee and on the third-party case (i.e., isolate the “problem”). From a mediator’s perspective, more information is better than less. However, strategically, parties sometimes choose to limit information provided to a mediator. Effective mediators should be able to deal with confidential information in ways that further, rather than hinder, the negotiations, but parties still sometimes elect to withhold information, which is their prerogative.

If, as the attorney, you decide to withhold this information from the mediator, you still have to have a gameplan for what the specific strategy will be in mediation, and you will have one less “teammate” on your side, since the mediator lacks some of the information to play a pivotal role. Depending on how you have valued the worst-case exposure, this may be a situation where you simply get the claimant to their lowest dollar and settle the case. Obviously, the other side should never be told the leverage they have, so what is the strategy? More so than normally, it is important to make sure the other side thinks their case is less valuable than it might have otherwise appeared.

It is also important to stay agile. In most instances, it is rarely advisable to show all of your cards at mediation until you truly expect the case to settle. Instead, hold one or two close to the vest for use later or at trial. But if your back is against the wall and you need to get the claimant to their lowest possible dollar, play every card you have in your hand. If there is any potential weakness in the claimant’s case, now is the time to disclose it. What is the point of saving something for trial if your intent is to settle as soon as possible?

Are there character issues in the claimant’s past that would be admissible at trial? Do you have a favorable venue or judge for the defense? Are you aware of a prior inconsistent statement for impeachment? Consider laying it all out now. The “confidential” memorandum you send to the mediator prior to the mediation? Consider making it not so confidential and share it with the other side so they can see the weaknesses in their case that they might not have known about.

There’s no guarantee that this process gets the claimant or their attorney to their bottom dollar, but it’s likely the best chance you have. There is no requirement that the confidential mediation memorandum must stay confidential. Use this as the final, and possibly most effective, arrow in your quiver.

It’s also important to counsel for future mitigation. On a client-relations note, the company should consider using such a situation as an opportunity for learning and growth. Could things have been done differently? Could policies be clarified? Are there things that might be done to support the former employee? Every negative situation provides an opportunity for learning, change, and growth. You may have to deal with this situation now, but hopefully you and your client can help ensure things go better in the future.