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Encouraging Parties to Settle

Wednesday, February 11, 2026 4:34 PM | Anonymous

Why Settling Out of Court Might Be ...

Do you believe that an arbitrator should regularly encourage the parties to think about settlement (or mediation) at various times throughout the course of an arbitration proceeding, or should they stay away from any discussion of settlement, after the preliminary hearing, and simply recognize that the parties are looking for a final determination from the arbitrator? If an institution is involved, should they be the one encouraging settlement (or mediation) rather than the arbitrator?

What are your thoughts?

Comments

  • Thursday, February 12, 2026 1:11 PM | Jim Burgess
    The Arbitrator may need to discuss mediation in the context of scheduling. But, the Arbitrator should refrain from encouraging settlement because it might send an improper and unintended message that the Arbitrator has made up his or her mind or is leaning one way.
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  • Thursday, February 12, 2026 1:14 PM | Dustin Hecker
    I am always happy to leave time in the case schedule for a mediation if the parties want that or to allow a suspension of activities so the parties can try mediation or settlement. But I don't see that actively encouraging or discouraging mediation/settlement is part of my role as arbitrator.
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  • Thursday, February 12, 2026 1:19 PM | Robert L. Arrington
    I agree with the two previous posts. I discuss mediation incident to scheduling but don't tell them they ought to settle. At times my preliminary rulings on motions may send a message that the case should be settled, but the parties need to figure that out for themselves. I never say so directly.
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  • Thursday, February 12, 2026 1:27 PM | Michael S. Jordan
    I usually encourage the parties to discuss and hopefully resolve briefing schedules, length of motions or briefs, etc and as suggested by others above to allow a time period in scheduling orders for the opportunity for mediation. I also urge them to consider reducing issues in the case and to let me know of any stipulations. We have a responsibility to minimize costs and aid in efficiency so comments in that direction are usually useful.
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  • Thursday, February 12, 2026 1:28 PM | Andy Tramont
    This is a great question! As an arbitrator (who is not a mediator), I would not at any point encourage the parties to think about settlement or mediation, other than letting them know that they have the option to talk settlement at any point in the case, either informally or with the help of an AAA mediator. My reason primarily is that my only role is to give the parties a final determination, and I would be concerned that suggesting settlement or mediation would prompt questions from non-lawyers (e.g., a consumer or the consumer's non-lawyer representative) about how I viewed the case.
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  • Thursday, February 12, 2026 1:28 PM | Murry Cohen
    Make a decision. That's what they pay you for. Except that AAA has a space on its scheduling form for mediation, I wouldn't even mention it in the scheduling order or the initial conference. These people know their rights and can mediate anytime, including during the final hearing. They don't need my encouragement or my "deadline," which is not a deadline at all.
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    • Thursday, February 12, 2026 7:43 PM | Peter Liloia
      I agree with Murry Cohen 100%.
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  • Thursday, February 12, 2026 1:35 PM | Lisa Renee Pomerantz
    At the preliminary hearing, I ask if the parties want to consider mediation but generally do not bring it up again. The arbitration process can often lead to settlement by fostering cooperation between the parties and focusing their attention on the real issues in dispute. Often, I have thought by achieving rapport and credibility with counsel and a good understanding of the case, I would be in an ideal position to mediate it, but I never bring it up because of the AAA policy against arbitrators switching roles. It might be useful for the AAA to reconsider that policy or for case managers to be given discretion to suggest that possibility where it might make sense.
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    • Thursday, February 12, 2026 1:52 PM | Jason Brown
      I don't see a compelling reason why an Arbitrator should have more restrictions than a trial judge as far as inquiring about or even suggesting mediation--so long as it's in a completely even-handed manner, given the costs, time and uncertainty of proceeding. I agree that any such suggestions should not be repeated excessively, or in any manner which could give the impression that the arbitrator is reluctant to see the case through to a final hearing.
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  • Thursday, February 12, 2026 2:07 PM | Jerry Diekemper
    In 34 years as an advocate, I tried 250 arbitrations. There were some, but not many, arbitrators urged counsel during the hearing or at the end to settle. This never bothered, and sometimes settlement was a good idea.
    In 1800+ cases as a mediator that don't settle, my last question in each caucus before I conclude there is a true impasse is: "How are you better off? Is a settlement today, no matter any shortcomings it may have, better than going though spinning the wheel of justice and seeing how things come out at trial or in a future appeal that could result in loss or a retrial?"
    Sometimes I will make a mediator's proposal when I sense that one or both parties may not really be "done."
    Since 2007 and arbitrating over 200 cases, I have rarely urged settlement. As a recent example, in a public employee discharge case where the CBA had a provision for due process and just cause, the fire chief testified he did not even try to go though the due process procedure. After the completion of the chief's testimony, I called the lawyers out in the hall and suggested the denial of the contractual provision might require me to reinstate the grievant. The lawyers caucused with their clients and then each other and settled the case. I thought that approach was better than anything I might have come up with as a remedy.
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  • Thursday, February 12, 2026 2:15 PM | Barbara Lichtman
    As a labor arbitrator I begin each hearing, before I hear anything about the case, asking the parties if they have spoken with each other or want the opportunity to do so, before we begin. I note that I ask this now before I hear the case so it is not construed that I am asking because of something I heard. I also tell them that if any time during or after the hearing they would like to pause to discuss privately they should do so. It is always best for parties to find resolution than being told how it is to be resolved. This has been quite successful and I know parties choose me at times for this reason. I dont push mediation once stated. That is up to the parties. In a rare instance, based on a very recently heard case, I am tempted to contact the parties to attempt mediation but thus far have refrained from doing so. This approach may be more "acceptable" in labor cases than commercial or employment. My practice is limited to labor.
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  • Thursday, February 12, 2026 2:40 PM | Anonymous
    Arbitrators should recommend that parties explore mediation. Sometimes counsel needs the “cover” of the Arbitrator’s suggestion. It can be included in the IPHO as a suggestion, obligation and/or a deadline to complete. Obviously, we encourage participants to use AAA panel mediators.
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  • Thursday, February 12, 2026 2:40 PM | Stuart Riback
    I generally don't explicitly encourage settlement because I'm concerned that one side or the other may infer that I think their case has a problem. As others have mentioned, I do take mediation into account when setting schedules. I do usually mention at the preliminary hearing that if the parties are interested in pursuing settlement with assistance, the AAA can make a mediator available. But my job as an arbitrator is to shepherd the process along to a hearing and decision in accordance with the parties' agreement and as the facts and law dictate. I will accommodate parties' desires to see if the case can settle but not much beyond that. As a practical matter, the reality is that in commercial cases, both sides are well aware that mediation is available and that settlement is always an option - I don't think having the arbitrator say that adds much.
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  • Thursday, February 12, 2026 2:42 PM | Jack Levin
    First, I think that an arbitrator should only broach the topic of mediation if they have confidence in their ability to so effectively, meaning that the arbitrator should be in control of the message and have some confidence that counsel and the parties will receive it correctly. Some arbitrators are not good at this. Some counsel and parties are tone deaf when they hear the word "mediation." Second, what is the occasion? There are standard times to mention mediation. One is at the beginning of a matter when nothing substantive has happened. When setting a schedule, it may be well received to have mediation or a "mediation window" established at the end of discovery or after decision of dispositive motion. To guard against the misinterpretation of my words, I am always careful to say, whenever I have a question about the merits, that I am seeking to understand an issue and that I not reached any conclusions. The test in all of this is whether mentioning mediation may help the parties and counsel.
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  • Thursday, February 12, 2026 3:11 PM | Joseph A McManus
    I usually bring up mediation in the Preliminary Conference but after that I don't feel it is appropriate to suggest mediation again. It can send the wrong message including the thought that my decision would be a compromise award rather than an award on merit.
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  • Thursday, February 12, 2026 3:24 PM | Mark Bunim
    After the completion of the evidentiary hearing, I frequently tell counsel that now that they have heard all the evidence and before they begin spending the time to write post-hearing briefs, and before the Tribunal spends the time writing a reasoned award, which can be very costly, it may be best if they take the time to talk to each other and see if settlement is possible. I give them a 2-week hiatus where there will be no further time spent, except for them to see if they can resolve the dispute. If at the end of 2 weeks they do not tell the Tribunal that a settlement has been reached, then the clock starts running again and they should begin working on post hearing submissions. This is the only time I mention settlement. If the parties come back and say they have had discussions and they want more time to try to come to an agreement, we extend the hiatus.
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  • Thursday, February 12, 2026 4:14 PM | Laura Bottaro
    As the arbitrator I always encourage mediation during the preliminary conference, and I will have a longer conversation about it if preserving relationships is important. It is my job to help the parties reach a fair, just and efficient resolution. I will not hesitate to make a decision in arbitration if that is what they want. But often both sides have not even thought about mediating before I raise the topic.
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  • Thursday, February 12, 2026 5:33 PM | Alex Vesselinovitch
    I handle many consumer arbitrations where the amount in dispute can easily be exceeded by attorneys fees and arbitrations fees/costs. I think in consumer disputes, it may be more appropriate to encourage mediation or settlement discussions than in larger stakes commercial cases. This can be done tactfully without sending any message on the merits of the claims.
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  • Thursday, February 12, 2026 8:59 PM | Stephen G. Yusem
    No principle is more fundamental to the arbitration process than the utter neutrality of the arbitrator. An arbitrator, whether personal or institutional, puporting to encourage settlement violates that principle or may be perceived as violating it. The parties have retained counsel to either contest or settle the dispute. That duty lies with counsel or with the parties themselves and not with the arbitrator. And If the arbtrator communicates with any party alone, that, ipso facto, disqualifies the arbitrator.
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