Alternative Dispute Resolution

Prof. Anolik

11/5/20

Gasoline and Antifreeze

Planning:

I was lucky to work with Danielle Maffei, a law student from PACE University who

served as my counsel. I played inside general counsel for Foster Fuels, a company founded and

owned by my father. My company has had Waltham as a gasoline customer for several years.

Recently, we started selling Waltham antifreeze which they now allege is contaminated a large

number of their trucks. My father is indignant and denies liability entirely. In spite of this a

settlement is objectively the lowest cost path forward. The damage from a public fight, combined

with litigation costs will be excessive. I don’t have a realistic alternative to that reality. I entered

the mediation conscious of the inconsistent nature of my assertion of blanket innocence from

liability and a willingness to settle.

Foster Fuels prioritizes moving past this misstep seamlessly with our reputation

untarnished. To accomplish that we needed an agreement to supply fuel to Waltham going

forward and a non-disclosure agreement. We would pay up to $200,000 to get this done. Our

reputation was more important that winning this particular fight. I knew ultimately that a carrot

not a stick would get this deal done. My approach embodied the flexibility to adapt a “win-win”

approach over a “win-lose” approach to reconciliation.1 This course’s text tells us that step one

of the mediation process involves envisioning a successful outcome, Foster Fuel’s amicable

ongoing relationship with Waltham was paramount, not the value on check I know we would

have write.
1
Dispute Resolution: Beyond the Adversarial Model Second Edition. P. 299
 Danielle provided thorough, on point notes on the tangible factual points tied to

Waltham’s claim. She presented me an effective strategy for arguing that even if our antifreeze

was at fault, our liability should not extend beyond 21 trucks which were directly affected. Her

ability to do this dirty work would allow for me to wear two hats simultaneously and eased my

qualms about being inconsistent. I could deny liability and negotiate a settlement without having

to myself entertain the veracity of the liability.

Step two in the casebook’s list decides where a party wants to go, i.e. determining what is

an acceptable outcome. 2 As outlined above the only flexibility in outcomes for me was

monetary. A non-disclosure agreement and continued gasoline selling relationship we

paramount. If a cash settlement produced effective reconciliation it would be worth even a steep

price. When we reached this stage of planning, I reiterated the paramount important of harm

reduction over monetary gain in this mediation. Danielle hinted at pushing for $100,000 even as

a settlement. I pushed back that up to $200,000 would be amicable if other conditions were met.

I explained that no deal would cost us more than a bad deal here even if our antifreeze was not

actually at fault and we won in court down the line.

Having defined our goals, we moved to a tangible discussion of strategy in the Zoom. I

told her I wanted to be opiniated, loud and drop in out. I hoped to use her as a voice that listened

to the other side when they inventoried damages. We agreed that she would allow me to

complain about the allegations on their face while also later broaching settlement. Indicating to

the other side that you are amicable to settlement without showing weakness is a complicated

game she would let me to play seamlessly. She would allow for my inconsistency by being the

one to delve into specifics with me framing the discussion with my all-encompassing objection. I

2
Id.
she could pull on the rope with small battles while I held the anchor of the larger push and pull.

She executed this plan to a T. I should have leaned on her more.

Our course’s text talks about preparing settlement options other than money. It talks

about “converting business disputes into business opportunities. ” 3 While Danielle and I

overlooked this we ultimately benefitted from our adversary’s creativity along these lines.

Thomas, my classmate representing Waltham in the simulation, commendably envisioned a

future discount as an alternative to a monetary settlement bringing the textbook’s dispute to

opportunity to life. The flexibility such settlement gave both sides made coming to a deal

possible. Perhaps even easy. Ultimately his solution allowed a majority of the settlement to flow

from Foster Fuels to Waltham in the form of a business opportunity.

3
Id. at 301
Simulation:

As planned, when the mediators first called on me I spoke briefly. I expressed my blanket

opposition to the allegations set forth against my company and passed the mic to Danielle. While

it was important for our side to entertain the liability, specifics set forth by our opposition having

Danielle handle that allowed me to keep my hands clean of such compromising discussions. It

was important to me that when I re-enter discussions it was an amorphous payment, not an

inventory set by my opponent.

Thomas did a very good job of framing our liability as expansive and multifaceted by

going through an inventory of damages and putting forth monetary representations of each

element. The way Thomas broke the monetary liability up was an effective tool. It allowed him

to throw numbers out without them being tied to a bottom-line. He could give ground then move

the goal posts by moving to a different of his defined sections of liability.

I ultimately reentered the discussion somewhat hostilely to push against this framing. She

allowed me this luxury by eroding their minor bifurcated claims and focusing the discussion on

making them whole completely. I was able to both maintain that my product had no corrosive

chemical in it while engaging in settlement talks with a straight face because of the gap she

filled. This was because Danielle had effectively entertained Waltham’s claims respectfully

without giving ground. For example, she brought up how Waltham’s trucks were already

rundown, and the damaged trucks would have needed an overhaul sooner or later, and so

$10,000 per truck was excessive. She created the wiggle room in what made Waltham whole that

I needed at closing.
 When it came time for our side to speak with the Mediators alone my side went second.

This was a weird experience. I was moved out of the Zoom. The reality that I was in my

bedroom, that there was laundry on the floor. Then I was bored. What was taking so long? What

was the other side saying? When I was summoned back to meet with mediators alone, I was shell

shocked. Thankfully I had Danielle. She spoke well to our specific opposition not just to the

theory of liability itself, but to Waltham’s sweeping interpretation of our liability. After I had

time to orient myself, I made a point of shifting tones from that employed in my indignant

denials and established my willingness to settle if a deal with a non-compete clause and a

continued business relationship was on the table.

After the breakout sessions with mediators our mediation gained positive momentum.

The discussion turned to a single payment from multiple facets of liability. At this point it was a

numbers game. An agreement might have been tough to reach if it were not for Thomas, made

this negotiation easy with a creative solution. A payment through future discount made this an

easy deal. As my central focus was mitigation of loss not just financially but in terms of

reputation and retaining business. We settled on a $100,000 payment and future discount of 1%

on gasoline until $170,000 was recouped and a non-disclosure agreement. I see the future

discount on gasoline as a net benefit for my side. Such sales are likely still profitable for our

company and it, together with the non-disclosure agreement, assures maximum reputational

damage control.

Thanks to Thomas a business dispute became a business opportunity for both sides. That

said opportunity was directly tied my goal of reputation management through a continued

business relationship made this solution truly bespoke. I was able to push Thomas down from a

5% discount to a 1% discount. This made ok with giving up $170,000 discount dollars. Waltham
being made whole slowly by doing business with us in the future was a huge win-win. While I

might have viewed a 5% discount as a cost, but a 1% discount paid for itself in the assurance of a

future relationship and dissipated my fear that the business relationship I was agreeing to would

be costly even temporarily. The $100,000 check we would write Waltham was less than our legal

fees would have been. Even if we had won in litigation, we would have additionally incurred

exponential reputation damage. This deal was a win for Foster Fuels.

Participating in a negotiation simulation on Zoom was a daunting experience. Our

casebook talks about the choice of both location duration and timing4. The lack of a shared

physical environment was an obstacle to them empathy necessary to achieve reconciliation. In a

normal setting the physical space I occupy can inform my tone and behavior. In my previous

negotiation experiences an unconscious reaction to stress is so triggered. I have become

comfortable with and ultimately dependent upon this mental state in approaching negotiations. I

was weird negotiating without butterflies in my stomach. My previous experiences with

negotiation have occurred in a Brooklyn Law School classroom or in an employer’s office.

These are places I am inherently uncomfortable, and it serves me. On Zoom I had to summon a

tone and approach exclusively internally from my bedroom. Watching myself speak added an

additional layer of artificial performance. I felt a lot more like an actor than my live in person

experiences. In part this effect was freeing and positive. However, I feel I may have been a bit

cavalier in my resulting unrestrained approach.

Timing also played a large part in these negotiations. Ultimately the deadline served to

bring the two parties together. Once a deadline was mentioned by the mediators both Thomas

and I started making realistic offers. It was at that point that I realized that there was

insurmountable mutual interest in getting a deal done. Prior to the kick in the butt provided by
4
Id.
the deadline our discussion had become somewhat circular. The casebook talks about a happy

medium between timing which allows for adequate presentation and a mediation which becomes

an unproductive marathon5. I think the deadline here served to create a goldilocks zone. Both

sides had been heard enough to find common ground, the deadline provided needed impetus.

Ultimately, I feel positive about the deal I struck. In the real world I might have some

qualms about how my approach might have left other’s view of me both professionally and

personally. I frankly was brash and spoke too much.

5
Id. at 300
Roll of the mediators:

The mediators exhibited control over our simulation without dominating it. Above all

else they did a good job of listening and making specific references to parties stated positions.

The were able to make such references in a constructive manner which pushed our discussions

forward to settlement. While Thomas and I both ran hot at times at no point was progress

inhibited by emotion thanks the neutral anchor they created. This anchor found its weight from

their compassion, not their strength. Our casebook describes a process of building an information

base by asking “tell me more about…” questions. 6 This was a go to strategy successfully

employed by our mediators, especially when in response to impassioned outbursts. This strategy

serves to force parties to push forward on tangible terms rather than veering apart from each

other abstractly. For example, they employed this strategy with me by responding to my pushing

back on inventoried damages with indignance over the root cause by referencing my previously

stated willingness to reach settlement. Such respectful reminders prevented backslide and

ensured positive momentum.

It has been said by fans of the sport that a great referee in Basketball is simultaneously

invisible and in control. I submit that this dichotomy also applies to mediators. They pushed

Thomas and my dialogue forward without having to speak over us to forcefully control the

discussion. Rather, they used attention to detail and content laden follow ups to move things

along. By using the party’s words rather than their own they were able to direct without

controlling. This strategy was successful in channeling emotional outbursts by me and Thomas

productively. Conversely as we got towards closing the mediators did a good job stepping back

and letting Thomas and I rally back and forth in a productive manner.

6
Id. at 288