Inside the Caucus: An Empirical Analysis of Mediation from Within

• Published date: 01 December 2015
• Date: 01 December 2015
• DOI: http://doi.org/10.1111/jels.12089

Inside the Caucus: An Empirical Analysis

of Mediation from Within

Daniel Klerman and Lisa Klerman*

This article provides a glimpse into the worlds of mediation and settlement negotiation. Because

they are almost always private, there has been relatively little empirical analysis of the dynamics of

settlement or mediation. This article analyzes a unique data set derived from a mediator’s

contemporaneous notes of mediations involving employment disputes, such as claims of

discrimination or wrongful termination. Although the data set includes more than 400 cases,

since they were all mediated by a single mediator, this article can be viewed as a case study.

Among the most interesting facts uncovered by this analysis are the following. Mediation can be

extremely effective in facilitating settlement. The mediator studied here achieved a settlement

rate of over 94 percent. There are very few gender differences, whether one looks at the gender

of the plaintiff or the gender of the lawyers. For example, settlement rates are the same for male

and female plaintiffs and lawyers. On average, cases settle much closer to the defendant’s first

offer than the plaintiff’s, irrespective of case type, size of law firm, or other factors. A mediator’s

proposal appears to be the most effective mediation technique. A mediator’s proposal was used

in almost 90 percent of cases and, when it was used, the settlement rate was over 99 percent.

I. INTRODUCTION

This article provides a glimpse into the worlds of mediation and settlement negotiation.

Because negotiations are almost always private, there has been relatively little empirical

analysis of the dynamics of settlement bargaining. In addition, although there is a large

literature on the effectiveness of court-ordered mediation and the mediation of union

grievances, there is little published research on consensual private mediation.

1

*Address correspondence to Daniel Klerman, Professor of Law & History, USC Law School; email: dklerman@

law.usc.edu. Lisa Klerman is a private mediator as well as Clinical Associate Professor and Director of the Judith

O. Hollinger Program in Alternative Dispute Resolution, USC Law School.

The authors thank Scott Altman, Ian Ayres, Bernard Black, Alex Capron, Sam Erman, Kuo-Chang Huang, Gil-

lian Hadfield, Michael Heise, Eric Helland, Louis Kaplow, Greg Keating, Jacob Klerman, Russell Korobkin, Mar-

tin Krieger, Robert Mnookin, Emily Ryo, Max Schanzenbach, Steven Shavell, Kathryn Spier, Matthew Spitzer,

Abby Wood, and participants at the Fifth Law & Economic Analysis Conference (Academica Sinica, Taiwan), Con-

ference on Empirical Legal Studies, Harvard Law & Economics Seminar, UCLA Negotiation & Dispute Resolu-

tion Colloquium, USC Law School Faculty Workshop, and Yale-Quinnipiac Dispute Resolution Seminar for their

comments and suggestions. The authors also thank the USC law librarians for outstanding assistance.

1

Ralph Peeples, Catherine Harris & Thomas Metzloff, Following the Script: An Empirical Analysis of Court-

Ordered Mediation of Medical Malpractice Cases, 2007 J. Disp. Resol. 101, 102 n8 (2007). See also sources cited

in footnotes 10 and 11.

686

Journal of Empirical Legal Studies

Volume 12, Issue 4, 686–715, December 2015

The presentation here is largely descriptive, but it is hoped that it will spark both theoreti-

cal elaboration and further empirical investigation.

This article is based on contemporaneous notes of more than 400 mediations con-

ducted by one of the authors.

2

Although the large number of mediations allows multi-

variate regression and other forms of quantitative analysis, since the study involves a

single mediator, it can also be thought of as a case study. All the cases involved employ-

ment disputes, such as claims of discrimination or wrongful termination. The mediator’s

notes include the amount that each side offered in each round of negotiation, whether

the case settled, the amount and terms of the settlement, information about the parties

and their lawyers, and whether particular techniques—such as a mediator’s proposal or

bracketed offers—were used. Although the use of a single mediator’s notes allows exam-

ination of topics not previously studied—such as the pattern of offers and counteroffers,

and the use of bracketed offers—there are also drawbacks to such a study. Findings may

not generalize to other mediators, and the fact that the mediator is also one of the

authors introduces possible biases.

Empirical work on mediation is particularly important because mediation is wide-

spread and its usage is growing. A 2011 survey of Fortune 1000 corporate counsel found

that mediation is now the most common form of alternative dispute resolution (ADR).

It is used “frequently” or “always” by 48 percent of surveyed companies, and its use has

increased since 1997. In contrast, arbitration is used “frequently” or “always” by only 19

percent of companies, and its use has been decreasing.

3

While there is a considerable body of research on the effectiveness of mediation,

because mediations are usually confidential, there has been a smaller amount of

research into what happens inside mediation. Deborah Kolb observed 16 union-

employer contract mediations conducted by federal and state agencies. Her study

focused on the roles and strategies the mediators employed. For example, she found

that state mediators were more likely to play a “dealmaker” role, keeping the sides in

separate rooms, pressuring one or both sides to make concessions, and communicating

proposals from one side to the other. In contrast, federal mediators tended to play an

“orchestrator” role, encouraging the parties to meet in a single room and to negotiate

directly with each other.

4

Lisa Bingham and collaborators conducted a number of stud-

ies of the U.S. Postal Service’s grievance mediation program. USPS forbade her and fel-

low researchers to observe mediations or collect demographic data, but through surveys

and interviews she was able to investigate a number of issues, such as party satisfaction

2

For a somewhat similar study, see Ralph Peeples, Catherine Harris & Thomas Metzloff, Following the Script: An

Empirical Analysis of Court-Ordered Mediation of Medical Malpractice Cases, 2007 J. Disp. Resol. 101--18 (2007)

(analysis based on observation of 46 mediations).

3

Thomas J. Stipanowich & J. Ryan Lamare, Living with ADR: Evolving Perceptions and Use of Mediation, Arbitra-

tion and Conflict Management in Fortune 1000 Corporations, 19 Harv. Negot. L. Rev. 1, 44--46 (2014).

4

Deborah M. Kolb, The Mediators (1983).

687Inside the Caucus: An Empirical Analysis of Mediation from Within