Attorney James Naugler is a partner at Moen Sheehan Meyer, Ltd. in La Crosse. He obtained his bachelor’s degree from the University of Wisconsin - Stevens Point, magna cum laude, and his law degree from the University of Wisconsin in 1979. Prior to joining Moen Sheehan Meyer, Ltd. in 1981, Attorney Naugler was an Assistant District Attorney in La Crosse. His areas of practice include business law, general litigation, insurance defense, products liability litigation, and personal injury cases.

Attorney Naugler has been mediating cases for roughly ten years. We recently sat down with him to discuss his experiences as a mediator and suggestions for a successful mediation.

Why did you decide to become a mediator?

Two things, but mostly people would call and ask, and I realized that I had a pretty good handle on bad mediators since I had run into a few and know what good mediation looked like, and that is what I aspired to do. 

What is a “good mediation?”

Generally, good mediation would be listening, knowing the facts, not being judgmental, and dealing with the parties in a respectful manner. 

Is your goal always to settle the case? 

No. I want to settle the case, but sometimes these cases will settle after mediation and mediation may fail for a host of reasons. First, lack of discovery. People want to mediate too quickly. Secondly, there are certain facts which have to be established in order to arrive at the true value of the case.

Are certain types of cases more difficult to settle than others?

The most difficult cases to settle are the small ones. They are the most time consuming for some reason, and they frequently can be emotional. If you are trying to settle, say, a real estate matter or some commercial matter, emotions can be quite high. But they are difficult to settle because there is just not enough money there. And those are tougher than the big ones. 

How does the plaintiff’s room differ from the defense room?

In the defense room, of course, you are dealing with insurance people who negotiate and settle cases all the time. They have a good handle, generally, on what the verdicts are in the local area because they keep track and may use a system. 

In the plaintiff’s room, this is usually the person’s first time. They haven’t been exposed to this procedure. It is foreign to them. They are nervous, and they have different goals. As a mediator you have to spend ten to fifteen minutes to gain the trust of the plaintiff and if you can’t, your mediation is less likely to be successful. I work very hard immediately to put the parties at ease because you have to get the parties to relax a little bit, be at ease, in order to communicate with them. You spend a little bit of time explaining the procedure and that includes the negotiations, the offers, and the counter-offers. That’s why there’s more time in the plaintiff’s room because you are explaining to them the process and the negotiation process. You usually explain to the plaintiff that the attorneys are all experienced and we are all trying to figure out what the value of the case is –but the ultimate people that will determine the value of the case is the jury. The other thing to bear in mind is the end goal here. What most plaintiffs want is just to know that they have the insurance company’s best offer short of trial. And, then they can make their own decision. 

Most people are terrified of going to trial, or certainly nervous about it, because it involves public speaking. The three greatest fears of Americans are heights, snakes, and public speaking. With that in mind, it kind of makes it easier to progress to some type of a settlement. Incidentally, most lawyers, unless they’ve been in court, and very few have these days, because fewer than 1% of all civil cases go to a jury trial – are also nervous or scared of trying the case. 

How do Zoom mediations compare to live and telephone mediations?

Zoom came in to being because of COVID-19. The advantage is obviously safety. It is also convenient. You have less travel time, both by attorneys on both sides. And, the other thing that is important—and you can’t lose sight of this—is the plaintiffs or parties may well be more comfortable and relaxed if they are Zooming from their home than in some lawyer’s office. 

A disadvantage of Zoom is technological glitches, and I think anybody that’s been mediating has been through those. Zoom is also cold medium, just like television. It’s not personal. It’s harder to read the room. It’s tougher on the mediator, but right now Zoom mediations are extremely popular. 

The big advantage of a live mediation is you can feel the atmosphere in the room. The mediator can read the room, can evaluate the moods, can know what to say and what to avoid, and can see if there’s a problem or objections. Also, many large companies pretty much insist that mediations be live because there is a huge advantage in negotiating between people in a live setting than in a Zoom or a phone setting. For me personally, live is preferable because I enjoy people.

The disadvantages of live are safety during COVID-19. Travel is another one. Sometimes people have to travel long distances. Maybe a plaintiff is out-of-state, they can appear by Zoom which is much more financially beneficial to them, and also probably makes settlement easier. 

Mediating in a live setting such as a lawyer’s office, which is a formal setting, can be intimidating and uncomfortable for a lot of plaintiffs. And then you have the difference between the rural and the city setting because once again most mediations take place in an urban environment and if somebody is coming from rural Wisconsin, they’re coming in and they have to find parking, they are in an unfamiliar area, so they are uncomfortable from the start. 

Phone mediations are the least popular. Insurance claims people often prefer to appear by phone. They live on the phone. They are comfortable on the phone. But, really, it’s terrible if you are asking plaintiffs’ attorneys or the plaintiffs to negotiate on the phone because basically, they are negotiating blind. Ninety percent of all information that is translated to the brain is visual.

Do you have more success with live mediations versus Zoom?

Not necessarily. I’ve settled six, seven, eight figure cases on Zoom. Zoom can certainly be very effective.

Do you prefer half-day or full-day mediations?

The majority of cases should settle within three hours or less. Now, there are some that won’t. If there are multiple parties, it’s a complicated case, there’s a lot of money involved, we’re negotiating with subros or whatever, we just book a day and it takes a day. But, for the average case, three hours or less. If I can settle a case in an hour, I’ll settle the case in an hour. If it takes three hours, I’ll settle it in three. I made a mistake once, and I’ll never repeat it, when I felt the parties were too far apart and ended the mediation too quickly. They eventually settled the case themselves. So, I will generally stay with a mediation until I know that everybody has said no, and they are at their limits, and then they go home. Because, most of the time you can get it resolved.

What is the worst thing a plaintiff can do going into mediation? 

I think the worst thing a plaintiff can do is what I call a “specials dump,” which is to come to the mediation with an extra $10,000, $20,000, $50,000 additional medical bills that weren’t shared with opposing counsel before the mediation. It immediately induces frustration and anger on the other side. It makes it very difficult sometimes; you may even have to suspend the mediation. And, by the way, these dumps can come from very good law firms as well as just average submissions. But, generally, that’s pretty much the worst thing you can do pre-mediation.

What is the worst thing a defendant can do going into mediation? 

They can go in with no authority. And, I can count on my hands when that has happened, but that is the worst. Also, if you’re coming in, or your position is we’re not paying anything, but we’re showing up, that’s not productive. It’s not useful and the assumption in the law is that the parties will negotiate in good faith. It seems to me that if you’ve got nothing to offer, you have an obligation to pick up the phone and call opposing counsel as a professional courtesy and then the parties can decide if they want to go forward with mediation. 

In those situations, what if the judge requires mediation? 

You talk to counsel. If they agree mediation would be a waste of time, it’s better if the two of you make the request than just you. Now, if the judge still orders mediation, at least everybody’s going in prepared. But, my experience has been that most judges will give you a trial date. The other thing that some judges don’t realize is that mediation is voluntary under the statute. They can’t really compel it.

What is the best thing a plaintiff can do going into mediation? 

Job one is to provide an accurate summary of the specials well in advance of mediation. Share those with opposing counsel. Specials are so basic to any insurance company’s evaluation of the claim and to miss that is just really tough. Second thing is to bring the decision maker. In other words, if the plaintiff is really not the one making decisions, but someone else, you need that other person in the room. I remember having an exceptionally difficult case and was warned by plaintiff’s counsel that the person who was making the decisions was the husband, not the wife, but the wife was the one who was injured. Third thing is pick up the phone and call the mediator if there are issues you don’t want to discuss in front of your client. Ex parte conversations are not prohibited in mediation. I have had counsel call me and say, look, my client is extremely difficult, I am having trouble with control, here are the issues. That’s huge because I can go in and be prepared.

What is the best thing a defendant can do going into mediation? 

One of the problems—and this is an industry problem—is that insurance companies are very reluctant to share their authority with their own attorneys. Some do, some don’t, depends on the claims adjuster, depends on the carrier. That can make negotiations difficult, especially if you get close. Sometimes they’ll say to the attorney, look you’ve got X, and that’s fine. But frequently, they’ll leave the defense counsel out in the cold, and that’s not particularly helpful in a mediation. Especially if the claims adjuster doesn’t even want to talk to the mediator.

Do you prefer to speak directly to the adjuster? 

I think plaintiff’s counsel has a preference. I think when I can go in plaintiff’s room and say, “Just so you know, the claims adjuster is in the other room,” that gives everybody a sense that the insurance company is taking their negotiations seriously. As a practical matter, it doesn’t make any difference. The claims people have evaluated the case, it’s been reviewed, they have a certain amount of authority. I don’t think the claims adjuster being present is necessarily important. The defense attorney is absolutely critical. I mean, you’ve got to have the defense attorney either on the Zoom or live.

How often do adjusters show up in person to mediation? 

Oh, not much. Ten percent, maybe? It’s really low. The claims adjuster being there is important if it is a substantial case. For the average case, no, you just need defense counsel there.

When do you expect the insured to participate in mediation? 

The insured needs to participate if they are at risk for personal liability. If there is personal exposure to the insured, then there needs to be a conversation about whether they need to be there. Also, if there are two defendants and one is insured and one isn’t insured, you want the uninsured defendant present because they may have to write a check or do something to get the case resolved. But it’s rare that the insured is there. 

The other problem you have is when plaintiff insists on making an initial demand greater than the policy limits. It presents a problem because that demand means they are saying the insured is personally liable. Some carriers will say, look, we will not negotiate until you make a demand at or below the limits. You can always go to mediation and find out, but it puts the defense counsel in a very difficult position and it puts the insured in a difficult position. 

What do you do if the plaintiff insists on making an opening demand above the limits? 

You work on the plaintiff and you explain why. I say, you know, we’re not going to have a productive mediation if you continue to demand more than the policy limits. That’s just not going to happen because most carrier will not settle a case unless their insured is protected. And if their insured is not protected, then the mediation ends. And, that’s usually a motivator to get plaintiff to be reasonable.

What mistakes do attorneys make at mediation?

Confusion over authority. Saying, “I will only accept X,” when in fact they are only willing to accept Y. Or, “I have authority to do this,” and it turns out they don’t have authority to do that. As a lawyer, that undermines your credibility and also undermines the trust of the mediator. It’s really important that if you say you have authority to do something, you can deliver on it. 

Does that happen a lot?

It doesn’t happen a lot. Thank goodness. But it happens more frequently than you think and it’s frustrating. 

The other thing is negotiating in bad faith. Where you agree on a number, you settle on it, and then suddenly the other side starts adding conditions that weren’t originally discussed. It’s anything that wasn’t discussed or contemplated by the parties in reaching the settlement number. For example, you’ve got to pay the mediators fees, or you gotta pay this, or you gotta pay that. A confidentiality agreement is an excellent example. Some large companies insist on release language that I would call quasi-draconian. At that juncture, plaintiffs have a choice to take it or leave it. You don’t see it too often, but when it does, it makes it very difficult and leave a pretty bitter taste in everybody’s mouth.

What causes a mediation to break down?

I think where mediations are most likely to break down is where the plaintiff is not the decision maker. Where the woman comes in and she’s got to consult with her boyfriend who has already picked out the new car. 

How do you deal with subrogated parties at mediation?

I usually prefer that the plaintiff’s counsel negotiate with the subro. As a practicing attorney, I would be upset sometimes that plaintiff’s counsel had not dealt with the subro before mediation. What I’ve learned as a mediator is that, frequently, plaintiff’s counsel can’t settle the case with the subro until they figure out what the final numbers are at the mediation. So, I think it is the rule, not the exception, that plaintiff’s counsel will negotiate with the subro after they have reached a final number. And usually, frequently, the good lawyers will call the subro and sort of keep them apprised during the negotiations, which also is very helpful. 

I also make sure to ask, “What portion of the medical bills are unpaid?” If the person is obligated to pay a certain amount of money that is significant, say four figures or up, that means they are probably being hounded by credit agencies and that definitely influences the process. 

What do you like to see in written mediation statements?

It’s pretty simple. Just a little summary of the facts, liability, why there is, why there isn’t. Settlement negotiations are always important. You need to know what the last offer is and what the last demand is. For damages, you want to make sure there is not a big difference in what the defense thinks the specials are and what the plaintiffs are claiming. If there is, then you need to make a phone call and put them together. So, those are basically what you are looking for, which are just the key facts, or the key areas you need to know to evaluate the claims.

The only other thing I would add—and I don’t see enough of this—but it is probably useful to deal with the weaknesses of your case. You don’t have to dwell on them, but at least touch on them, acknowledge them, and how you’re going to handle them, because those are going to come up during mediation. Weaknesses will come up during mediation. Now, sometimes issues will come up during mediation that neither side contemplated, which is fine, because that’s what makes negotiations constructive and you may or may not get the case settled as a result of that, but at least those issues are on the table.

Do you want the submissions to be confidential or shared with counsel?

I think that judgment has to be left to counsel. I am very, very careful about what I share. So, if there is something you have that you don’t want shared, then you say we don’t want this disclosed, the other side will never hear it from me. It is absolutely critical that the mediator keep confidences. And that’s another thing I tell both parties. If they want to tell me something that they don’t want to share in the other room, it won’t be shared. It won’t come up.

What do you like to see attached to the submissions?

I think most mediators see depositions and medical record summaries, which some mediators will use extensively and some won’t. I’ve had more than one mediator say to me, “I hate deposition transcripts; I won’t read them.” Mediators are sensitive to time. Mediation is expensive and you want to give as thorough an analysis as you possibly can, but at the same time you want to do it economically and efficiently. This is why the mediation letters are so critical because they save so much time and they get to the points necessary to settle the case. 

In terms of attachments, if liability is at all at issue, then the basics, police report, statements, and photos. If there is a legal issue and briefs have been filed and the briefs are fairly reasonable, and the legal issue is important, then send the brief. You don’t have to send the motions. And then, any expert reports, permanency reports, IMEs, anything like that. In terms of deposition transcripts, if there are admissions that you think are helpful, then Xerox that page, yellow highlight it, send it off, or just take that portion of the transcript and put it in your letter. And then, if you want, when you come to the mediation, you can just bring the deposition transcript with you, or if you want, send it along. Obviously, if you have complex litigation, it’s going to require more depth, send it, and as a mediator you have an obligation to go through it. 

Will you read everything that is sent to you? 

No. Because frequently I get huge volumes. People will send a stack of medical records, or six depositions, and you look at the case and you know the size of the case doesn’t merit it. But, even if you have a seven or eight figure case, the facts can be often simple, and the damages are fairly straight-forward. I think most mediators, if you ask them, will tell you that the mediation letters are very, very valuable. It is the first thing the mediator reads. 

What happens if you receive a poor mediation letter?

Well, that’s not uncommon, and I think it puts the party’s case to a disadvantage. If you are given something that is clean and well written, it is human nature to tend to rely on that. But if the submissions are somehow inadequate, you realize it, and then you’ll refer to other things. And I find that the better the lawyers are, the better those submissions are. Sometimes, plaintiff’s lawyers will just send the demand letter. And, the demand letter is pretty good, but the lawyer should go back and review the demand letter and update is as necessary. 

Now, once you’re in the mediation, then there’s what I call an informal discovery process. So, the mediator is learning from the parties, filling in the blanks that weren’t provided by the submissions. 

What advice do you have for young lawyers?

Actually the same rules that apply to a young lawyer apply to someone who is experienced and been doing this a long time. Take the time. Do a careful mediation analysis. Make sure your specials are lined up and that you have given them to opposing counsel. If you have client control problems, let the mediator know either by email or picking up the phone. 

For young lawyers, they have to remember that with fewer than 1% of all cases going to jury trial, modern cases are trial by mediation. They should prepare for mediation in a way that they are putting their best case forward with all the issues. A young lawyer should think of a mediation submission as their trial outline. 

Our thanks to Attorney Naugler for taking the time to sit down with us to discuss his experiences as a mediator. To schedule a mediation with Attorney Naugler, contact him directly at [email protected], or his assistant Erica Pedrazoli at [email protected] or call 608-784-8310.

This interview has been edited for length and clarity.