negotiating case value: decision trees in mediation

Copyright © 2013 John DeGroote Services, LLC

Negotiating Case Value:Decision Trees in Mediation

Jun 20, 2013

State Bar of Texas • Litigation and ADR Sections • Dallas, Texas

Copyright © 2013 John DeGroote Services, LLC 2

Today’s Roadmap

• Who

• What

• Why

• How

• …and More


If you and the other side value your case

differently, at least one of

you is wrong.

Make sureit isn’t you.


Who Makes Settlement Errors?

• One Study Concluded

• 61% of Plaintiffs Failed to Beat Last Offer

• Defendants Failed 24% of the Time

• Plaintiffs’ Mean Error Was $43,000

• Defendants’ Was $1,140,000

Journal of Empirical Legal Studies 09/2008

-

The New York Times 08/2008

-

http://www.blakemcshane.com/Papers/jels_settlement.pdf


http://www.nytimes.com/2008/08/08/business/08law.html?_r=0





What Is a Decision Tree?

5

An illustration that shows the various possible outcomes

in a lawsuit and helps the parties

evaluate the costs, risks and benefits of each outcome.

““

- Daniel Klein

http://www.settlementperspectives.com/2009/01/decision-tree-analysis-in-litigation-the-basics/


Why Do a Decision Tree?

•“Probable”?

•Another Perspective• Events

• Contingencies

• Probabilities

• Timelines

• Costs

• Investment Analysis

http://www.settlementperspectives.com/2009/01/why-should-you-try-a-decision-tree-in-your-next-dispute/


http://www.settlementperspectives.com/2010/03/what-will-she-tell-her-husband/


How Do You Create a Decision Tree?

9

1 2 3 4

ListLitigation

Events

ConsiderCosts or

Gains of Each

Discount Eachby ProbabilityIt Will Occur

Do theMath

Image from ResolutionTree.com

http://www.ResolutionTree.com/

https://www.resolutiontree.com/

http://www.settlementperspectives.com/2011/11/decision_tree_step_by_step/


Another Example

10


…and Just One More

Image © Litigation Risk Analysis, Inc.

http://www.settlementperspectives.com/2009/07/advanced-decision-tree-analysis-in-litigation-an-interview-with-marc-victor-part-i/

http://www.litigationrisk.com/


Responding to the Naysayers

12

• They Objectify Litigation

• Not Everyone Is Rational

• The Parties Won’t Agree on a Number

• The Results Are Unreliable

• They Are Only for Commercial Cases

• Nobody Else Does Them

http://www.settlementperspectives.com/2010/04/avoiding-the-limitations-of-decision-trees-a-few-tips-from-mediators-who-use-them/


But Before You Go . . ..

13


http://www.resolutiontree.com/

http://www.settlementperspectives.com/


http://www.johndegroote.com/

mailto:[email protected]

http://www.slideshare.com/johndegroote

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