This page contains a Flash digital edition of a book.
Alternative Dispute Resolution


and sanctions may be appropriate. Te standard order scheduling a settlement conference


also cites the American Bar Association Standing Committee on Ethics and Professional Responsibility Formal Opinion (No. 93-370) which precludes a lawyer, absent informed consent, from revealing to a judge the limits of the lawyer’s settlement authority or the lawyer’s advice to the client regarding settlement. Te opinion does not, however, preclude a judge, in seeking to facilitate a settlement, from inquiring into those matters. In order to facilitate the settlement conference, counsel should discuss such issues with their clients prior to arriving. As the settlement conference may take the entire day,


all those in attendance should plan accordingly. Upon arrival and the commencement of the conference, the judge typically makes introductory remarks in the presence of both parties. While each party often is provided with the opportunity to present its side of the case in the presence of the judge as well as the opposing party, the presiding settlement judge retains the flexibility to take a different approach if it would be more productive. One recurring ethical issue that arises during settlement


conferences is the degree of candor required by counsel for the parties during the negotiations. In Ausherman v. Bank of Am. Corp., 212 F. Supp. 2d 435, 444-50 (D. Md. 2002), the Court distinguished between puffery, which is acceptable in settlement negotiations, and lying, which is not. Tere, during settlement proceedings, the plaintiff ’s counsel offered to disclose certain information to the defendant in return for a monetary payment. Id. at 439. However, the attorney later admitted that he did not actually have access to the information he promised to provide and that he simply made that statement, “for the purposes of settlement bluster.” Id. at 440. Te Court recognized that “certain aspects” of settlement negotiations (including, but not limited to settlement conferences) necessarily “involve statements that are less than completely accurate, such as posturing or puffery, intentional vagueness regarding a negotiating party’s ‘bottom line,’ estimates of price or value, and the party’s ultimate intentions regarding what an acceptable settlement would be—all of which are thought to encompass representations that are not “material.’” Id. at 446 (citing ABA/BNA Manual at § 71:211 (1997); 2 Geoffrey C. Hazard, Jr. & W. William Hodes, Te Law of Lawyering § 37.3). Te Court cautioned, however, that ‘“although lawyers are supposed to be zealous partisans of their clients, they must draw the line at lying,’” id. at 446 (quoting Te Law of Lawyering § 37.2), because “[i]t is just as damaging to the integrity of our adversary system for an attorney knowingly to make a false statement of material fact to an opposing counsel during settlement negotiations,


as it is to lie to a lawyer or the judge in court,” id. at 443- 44. Noting that Md. R. Prof ’l Conduct 4.1(a)(1), adopted by the U.S. District Court for the District of Maryland, see D. Md. Loc. R. 704, “prohibits an attorney from knowingly deceiving a third person, including an opposing counsel, during negotiations,” the Court elaborated:


Te misrepresentation may be either express or by a failure to disclose. It also must involve a fact or the law that is material to the negotiation, which necessarily must be evaluated on a case-by-case basis... A fact is material to a negotiation if it reasonably may be viewed as important to a fair understanding of what is being given up and, in return, gained by the settlement.


Ausherman, 212 F. Supp. 2d at 448-49. To know whether a statement is acceptable as part of settlement negotiations, an attorney should consider:


(1) what is the statement or omission in dispute? (2) is it untrue or deceptively incomplete in any significant respect? (3) reasonably viewed, is it important to the subject that is being negotiated? and (4) at the time it was made, did the attorney know or should have known under the circumstances that the statement was untrue?


Id. at 450. Trial Reporter / Fall 2010 15


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60