Judicial Settlement Roles

The major finding of this report is entirely consistent with that of Professor Provine in her seminal study of the settlement roles of federal judges:188 Judges engage in a wide variety of settlement

  1. For a case that concludes that a court has the inherent power to impose a
    sanction on an attorney for late settlement of a case, see Eash v. Riggins Trucking,
    Inc., 757 F.2d 557 (3d Cir. 1985).
  2. In re Key Highway, Fairfield and Sparrows Point Shipyard—Asbestos Cases,
    January 1986—Groups I & II, Memorandum and Order (D. Md. Nov. 1, 1985).
  3. Id. at 5-9. The mechanism for determining the party responsible is similar to
    the cost-shifting features of Fed. R. Civ. P. 68. Each party (or group, if negotiations
    are conducted in group fashion) must submit a sealed envelope containing its last
    settlement offer to the clerk of court, on the day after the deadline for announce­
    ment of the settlement. If no offer was made, that fact should be indicated or the
    party can simply decline to file a sealed envelope. The fine will be imposed on the
    party whose final offer differs most from the final settlement figure or who failed to
    participate in negotiations at the earlier time. Id,

    1. See generally D. M. Provine, supra note 130.

roles and use a wide range of alternative dispute resolution sys­tems, including summary jury trial, mediation, and arbitration. Her chronicling of the variety of settlement practices previewed my conclusion that in the context of asbestos litigation all judicial actions “work” to produce settlements. A disturbing feature of find­ings in the current report, however, is that the traditional schedul­ing of a Firm trial date, coupled with benign neglect until the day of trial, also works.

The District of Maryland’s dispersion of cases among judges re­sults in a microcosm of the universe of settlement practices—an in­teresting natural “experiment.” The distribution of cases is not to be confused with a controlled scientific experiment, but some sug­gestive comparisons emerge. Similar clusters of cases are assigned randomly to different judges. The only consistent difference among the cases is the assigned judge. In this district, cases are grouped by disease, jobsite and occupation, and plaintiffs’ counsel. Gener­ally, two clusters of four to seven cases each are assigned on a ro­tating basis to one of seven judges for trial each month.169

Lawyers reported four contrasting settlement styles used by the seven judges. Judge A becomes actively involved in the details of the negotiations, bringing all lawyers into chambers for what may turn into marathon sessions. In a case scheduled for a jury trial he will engage in “shuttle diplomacy” if the parties consent on the record, which they invariably do. Lawyers talk to him off the record about their offers. He is knowledgeable about prior settle­ments and not reluctant to press the lawyers to bring offers into line with previous outcomes. When it appears to be useful, he will express tentative rulings on disputed issues (lawyers report that this tends to rigidify the posture of the party anticipating a favor­able ruling, thereby reducing bargaining flexibility). Judge A has had well-known successes in settlement of complex litigation.

Judge B simply sets the cases for trial and expects that he will be informed of settlement before the trial date arrives. He issued a standing order imposing fines for delayed settlements. While gener­ally favoring settlement, he does not become involved directly. If the parties inform him that they could use some help in settling a case, which happens occasionally, he will refer the matter to a magistrate.

Judges C and D exercise what one lawyer characterized as “cool control” over the settlement process. They monitor the progress of negotiations and are seen as willing to become involved if neces-

169. In re All Asbestos Cases, Memorandum Opinion (D, Md. Dec. 16, 1983) and attachment A (Asbestos Claims Trial Schedule).

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sary. Judge C does not provide explicit evaluation of cases, but is likely to point out the weaknesses of a case. He does not try to hold parties to prior settlement levels. Judge D attempts to determine whether there is a critical mass of agreement just short of settle­ment. In those circumstances he will become involved; otherwise, he will listen to the views of the lawyers as to whether judicial in­volvement will help.

Judges E and F are somewhat more detached from the process. They will ask whether negotiations are taking place, but rarely, if ever, intervene directly in those discussions. While they indicate that they are available to stimulate settlement if necessary, law­yers perceive them as relatively aloof from settlement.

Judge G’s approach is less clearly developed. He is seen as friendly and accommodating, with an interest in settlement, but mostly in the role of a referee. He has not been directly involved in the negotiations, nor has he suggested specific values for cases.

In this single district then, there is one judge who is very active in settlement discussions, three judges who are moderately active, and three judges who are relatively inactive. Yet, virtually all of the cases settle. In 1985 and 1986, only one case was disposed of by jury trial (see table 6). Judge B’s cases settle a week before trial; all the others on the eve of trial or during the early stages of trial. None settles without a trial date.

At this stage of asbestos litigation, each of the settlement inter­ventions in the District of Maryland appears to have the same effect, assuming that there is no difference in the quality of the set­tlements. At a minimum, this indicates that the settlement activity of the trial judge is not the primary reason for settlements. Law­yers in the district confirm this conclusion. They report that settle­ments have become easier after an initial flurry of trial activity and settlements established values for the cases. Unless future trials change those values, they serve to set a range for settlements and render them more routine.

There were similar effects in other districts in which judicial in­volvement in settlement is rare. InEastern Tennessee, for exam­ple, the disposition rate exceeds that of other districts (see table 9), and no jury verdicts have been recorded after 1983 (see table 6), yet judicial expression of opinions about the value of a case reportedly would contravene accepted norms in the local legal community.

Harking back to Judge Keeton’s formula for assessing the utility of a case management technique,170 does judicial involvement in

170. R. Keeton, supra note 133. 72

settlement discussions save judicial resources? The normal settle­ment rate for asbestos cases being greater than 97 percent of the cases called for trial, there is a ceiling effect, allowing little room for improvement. Marginal efforts to induce settlements may consume more judicial time than they save. Using an estimate, generated from interviews, that an asbestos trial would last forty hours and that judicial intervention can raise the probability of settlement from 97 to 99 percent, less than one hour (.80 hours)171 of judicial involvement in settlement would be justified on effi­ciency grounds.

Efforts to produce earlier settlements appear justifiable only on grounds of improving the quality of settlements; efficiency grounds will support little more than a system of imposing fines for delayed settlements or a brief judge-hosted conference.

Given the above finding about the marginal utility of settlement intervention, what types of activity do attorneys see as productive or counterproductive? In general, parties seem most responsive to judicial efforts at settlement that meet their information needs. For the most part, these lawyers are repeat players in the settle­ment game and have established communication patterns that are likely to be altered only by dramatic judicial intervention, such as the imposition of fines for delayed settlements or massive restruc­turing, as in the OAL.

On the other hand, as U.S. Magistrate Wayne Brazil observed in his study,172 lawyers welcome the informed opinion of a judge on the merits of the case or on some aspect of the procedure. Presum­ably, lawyers treat these opinions as new information that may aid them in forecasting the probable outcomes and assigning a value to the case. Lawyers did not, however, welcome a cursory or superfi­cial opinion. However steeped a judge may be in the prior values of cases, expressions of opinions based on a brief discussion or review of a file were not credible. At a minimum, lawyers saw it as essen­tial that a judge review the medical reports and get information about compensatory damages in a specific case. Application of a simple formula, such as splitting the difference in the settlement

  1. For the formula and further discussion, see note 133 and accompanying dis­
    cussion.
  2. W. Brazil, supra note 136, at 39-56. Based on his survey of lawyers, Brazil
    concluded that lawyers involved in litigation “believe that a judicial officer’s opin­
    ions will contribute most to settlement negotiations when it is clear that the judge
    is approaching the case with an open mind and an impartial disposition, learns the
    facts, contentions, and the relevant law, then analyzes the matter with a visible log­
    ical   rigor   and   with   penetrating   questions,   questions   that   cut   through   the
    irrelevancies and the smoke to focus the litigants’ attention on the pivotal issues
    and the key evidence.” Id. at 48,

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range for prior cases with similar diseases, may interfere with ne­gotiations based on more refined assessments. Lawyers look to the court for new information that will aid their own evaluations. They do not seek casual judicial usurpation of their role. One lawyer stated the ideal as a “solid intuitive judgment without arm-twist­ing.” Another would like a “good listener who expresses an opin­ion.” Judicial familiarity with the record in the case seemed to pro­mote respect for the opinion of the court and candor from the law­yers when they present their negotiating positions to a judge.

Again, the OAL procedure provides a useful reference point. Lawyers in all the districts in this study appear to be quite inter­ested in learning about systematically collected settlement infor­mation, whether computerized or not. Trial verdict reports are no­toriously weak and information about settlement is often not made public.173 Without the expense or outside expertise required by the OAL, Judge Stanley Brotman of the District of New Jersey aided the settlement process by keeping a chart listing all previous offers and the final amount of settlements. He found this information useful in mediating the settlement of all cases in his division. In his court, a single jury trial informed the parties of his procedural and evidentiary rulings and the jury verdict gave a sense of the value of cases.174 Judicial collection of information about prior set­tlements, whether by chart or computer, directly serves the needs and interests of lawyers.

Another settlement-related activity concerns the clarification of the rules of the road. Trial judges have exclusive control of infor­mation about trial procedures and evidentiary rulings. At this stage of asbestos litigation, most rulings have become standard,175 To the extent that they have not, rulings and forecasts of rulings serve to allow a more precise analysis of the probabilities of success in each case.176 In the same vein, lawyers object to some courts’ perceived practice of postponing rulings on motions for summary judgment so that more defendants are available to contribute to a settlement. On the other hand, in one district defense liaison coun­sel requested such deferrals. Deferral of rulings for the sole pur-

  1. Daniels, supra note 153, at 5-9.
  2. A single trial may produce an extreme result, an outlier. In that event, how­
    ever, the side that felt dieadvantaged by the result would likely press for further
    trials. See generally Priest & Klein, The Selection of Disputes for Litigation, 13 J.
    Legal Stud. 1 (1984).

    1. See the discussion supra at notes 101 to 111.
    2. Constraints related to the judicial role may inhibit the informal rendering of
      what could amount to advisory opinions issued without benefit of briefing or argu­
      ment. See, e.g,, Resnik, Managerial Judges, 96 Harv. L. Rev. 374 (1982); Elliott, Man­
      agerial Judging and the Evolution of Procedure,
      53 U. Chi. L. Rev. 306 (1986).

pose of obtaining a settlement contribution from a party who is not liable seems difficult to justify.177

Mediation by judges178 received mixed reviews from the attor­neys interviewed. In one situation, the judge ordered the parties to exchange offers and submit their “bottom line” authority to him in a sealed envelope so that he could see whether there was room for settlement. When the offers showed no overlap, he announced that fact and aborted the process. Lawyers in that district felt that a more intense form of mediation would be helpful, and that it is un­realistic to expect that lawyers will reveal their true authority, even under seal to a federal judge.179 Instead, they felt that a solid review of each case by a judge-mediator (taking perhaps one half-hour per case) would provide a starting point for persuading par­ties to alter their stated positions.

An attorney in another district criticized judicial mediation as tending to put pressure on the plaintiff, who is more likely to be present at a settlement conference, than on the absent defend­ant.180 Equal application of pressure seems to be a general stand­ard by which lawyers evaluate fairness in mediation efforts; how­ever, in some circumstances, selective pressure on one party may be justified.181

177.  In many instances, the perceived practice may be a product of the existence
of a material issue of fact sufficient to survive a motion for summary judgment. The
recent decision in Celotex Corp. v. Catrett, 106 S. Ct. 2548 (1986), may reduce the
frequency of denials of motions for summary judgment.

In several of the districts studied, this problem rarely arose because the plaintiffs voluntarily (albeit sometimes under threat of sanctions) dismiss cases in which prod­uct identification is clearly insufficient. At least one judge has a general policy of not granting motions for summary judgment, but granting a motion for directed verdict and perhaps imposing sanctions for including a defendant without sufficient product identification to present the case to the jury. See, e.g., In re Asbestos Litig., Memorandum Order, Misc. No. 8482 (W.D. Pa. Dec. 13, 1983). See also T. Willging, supra note 4, at 20-21 (discussing standardized sanctions).

  1. We use the term mediation in the sense of direct efforts by a third party
    (here, a judge) to influence both parties to alter their positions and reach a compro­
    mise.
  2. Other judges have encountered this same problem. See, e.g., D. M. Provine,
    supra note 130, at 26.
  3. In  the OAL,  defendants sought a  writ of mandamus to restrain Judge
    Lambros from requiring corporate and insurance executives to attend all pretrial
    and trial proceedings until the termination of their cases. In re Ohio Asbestos Litig.,
    OAL Order Nos. 49-51 (N.D. Ohio Aug. 29-Sept. 4, 1986). The Sixth Circuit granted
    a stay of the order pending a hearing on the writ of mandamus. See In re AC & S,
    Inc., Case No. 86-3821 (6th Cir. Sept. 5, 1986).
  4. The equal pressure position assumes that each party begins from a point
    equidistant from a final settlement amount or range. It may also presume that each
    party has equal bargaining power. Unequal pressure may be warranted when one
    party is unreasonable in its demands and the other party is reasonable. Judicial ef­
    forts to prevent an unconscionable result may also justify intervention on the part
    of the party with little bargaining power. See D. M. Provine, supra note 130, at 32-34.

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In general, the success of mediation depends on deep involve­ment in the facts and dynamics of the litigation so that the judge as mediator can contribute information that will invigorate the set­tlement dialogue.