Thursday, December 15, 2016

Mediation Effects and Thoughts

The process of litigation can be counterintuitive. It is not a scientific process. Decisions are driven by a vast assortment of factors, that are factual, legal, emotional, and economic. It is therefore important to be careful with statistical anaylsis. 

It is relatively simple to calculate the volume of disputes in the Florida workers' compensation system. This is demonstrated by petition volumes and "new case" volumes. Though these demonstrate and measure the volume of disputes, neither has proven a reliable predictor of the volume of cases that eventually proceed to trial. 

The Florida Office of Judges of Compensation Claims (OJCC) measures these volumes and they are published annually in the Office of Judges of Compensation Claims Annual Report. These volumes have demonstrated some interesting trends over the last 15 years, but overall the trend has been to decrease, evidencing less disputes in the system. The Reports are all available on the "publications" tab of the website,, under the "reports" category. 

A particular petition may make a claim for a single substantive benefit, or many. Generally speaking, there will usually also be a claim for resulting attorney's fees and costs included in each petition, as well as interest and penalties in any claim for non-medical benefits. Thus, regardless of how many substantive benefits are claimed, it is likely that every petition will claim more than one issue. 

Statutorily, most petitions in Florida must be mediated. There is an exception for petitions that seek benefits worth less than $5,000. Those petitions are presumptively appropriate instead for an expedited final hearing, Section 440.25(4)(h), Fla. Stat. The legislature has decided that since these are perhaps less financially significant, that they could be and should be resolved with a rapid adjudication instead of mediation being engaged. The frequency with which expedited hearings are used varies significantly around the various districts in Florida. 

Mediation, as a concept is growing. It's expansion is discussed in Mediation is Growing it can Work in Comp. There are a finite number of mediation appointments on each state mediator's calendar. Recent evidence supports that petition filings are increasing. As availability of mediation appointments with Florida's OJCC State Mediators becomes more challenging for practitioners, they will face choices. 

One alternative will be for parties to shift disputes to the Section 440.25(4)(h) expedited process. Another will be private mediation, which can be expensive. And some will likely instead find that they benefit from speaking with each other outside of the mediation process, reaching informal resolution and obviating the need for mediation, as suggested in The Power of a Phone Call

An anomaly has been documented over a period of years in various reports of the Office of Judge of Compensation Claims. One might expect that the highest volume of trials would occur in the districts with the highest volume of petitions filed. But this has not been demonstrated. The failure of any consistent relationship between petition volume and trial volume suggests that determining relevance of statistical measures may in fact present valid challenges worthy of examination and consideration beyond the raw numerical analysis. 

The statistical analysis of "petition" and "new case" volumes, tend to indicate that despite raw filing volumes, some areas of the state are more litigious than others. A particular volume of trials appears more likely for a given volume of petitions in some regions. 

What effect does the mediation process have on trial volumes? That is difficult to answer. Florida workers' compensation is a litigation system that is in near constant change. Petition and "new case" volumes change, outside factors such as appellate decisions in other cases may influence the incident of trial, including individual perceptions of case value and trial success. And, there are interrelations between case value, settlement potential, and the state of the overall Florida economy. 

In one instance, however, there is the potential to attempt to discern some of the cause and effect of in-person mediation. In August 2014 mediator Wallace Hardy retired from the Pensacola district office. In an attempt to reserve resources, he was not immediately replaced. For a period of about one year, mediations for the Pensacola district office were conducted via telephone by mediator Eddie Oramas in Panama City.

It is worth noting, that many attorneys in the panhandle handle cases in two or three of what used to be the District "A" offices: Panama City, Pensacola, and Tallahassee. Therefore, there is a good likelihood of any particular Pensacola attorney being familiar with Mr. Oramas in Panama City. This familiarity with the voice on the end of the phone may have influenced the results of the telephonic process during that period. But, with the change described, the volume of petitions for mediation by Mr. Oramas in Panama City increased dramatically, virtually overnight. 

One might therefore anticipate that Mr. Oramas' volume of mediations would likewise double. That did not occur. 

In fiscal year 2013-14, Mr. Hardy and Mr. Oramas mediated a combined total of 1,302 petitions in 1,023 mediations. In 2014-15, a fiscal year during which Mr. Hardy worked about one month, the combined totals were 835 petitions in 658 mediations. 

After Mr. Hardy departed, petitions mediated and mediations held, overall, decreased. As discussed above, this system is regularly changing. Some of this decrease resulted from the decision to relieve Mr. Oramas and Pensacola of mediation coverage in district West Palm Beach. Prior to Mr. Hardy's departure, both mediators were performing mediations telephonically in District WPB, and with Mr. Hardy's departure that burden on Mr. Oramas was appropriate ended to allow focus on the Pensacola and Panama City combined volumes. 

Despite the combination of responsibility for two district's mediations, the volumes of both mediations and petitions mediated in the Pensacola and Panama City districts decreased markedly in 2014-15. With the West Palm Beach assistance cessation in mind, the marked decrease seems counterintuitive. 

If similar volumes of cases were not being mediated, then one would next intuitively expect the volume of trials in Pensacola to increase. The natural result of less mediations would seem to be less agreements, and thus more disputes requiring judicial intervention. Without the effort of a live mediator in Pensacola, and that market thus dependent upon telephonic mediation, the frequency of resolution might be expected to decrease, thus necessitating more trials. 

That also did not happen. In fact the volume of trials in fiscal year 2014-15 (the year during which Pensacola had no mediator) actually decreased compared to the year before. Less mediations and thus less agreements led to less trials. The decrease was significant, about 1/3, from 64 trials to 42 trials. 

Because trials follow mediation chronologically (perhaps months later), there is not necessarily a direct correlation between these figures. It is likely that unresolved cases in the latter part of 2014-15 might have been later tried in 2015-16. 

The Office of Judges of Compensation Claims changed its definition of Trial in 2015-16. See, "Trial Orders," Definitions and Rules. But, even applying the prior definition to Pensacola's 2015-16 hearings (for consistency in comparison), the volume of trial orders in 2015-16 would have been 37, a further decrease. Thus, the statistics do not support that the absence of a live mediator in Pensacola led to any increase in trials. 

What does this data tell us about the efficacy of mediation? The alternatives to state mediation are limited. A party noticed for telephonic state mediation in 2014-15 possessed two viable alternatives: private mediation and negotiation. 

Private mediation can be expensive. And, anecdotally, there have been perceptions that there are fewer private workers' compensation mediators in Pensacola than in some more populous areas of Florida. Thus, there are at least two possible reasons one might not select the private alternative. In more populous areas, perhaps only one. 

The second alternative is inexpensive and potentially efficient. For those who practiced before the 1993 statutory amendments, negotiation was a common practice. Petitions were received, issues were analyzed, phone calls were made and agreements were reached. There was also benefit back then of many in-person proceedings at the workers' compensation office, and a relatively small workers' compensation legal community. One would often run into opposing counsel at the "comp office" and have the opportunity to discuss some new case or issue informally, thus saving the phone call (and potential "phone tag"). 

Of course, there is the third alternative discussed above. Parties and attorneys should always consider the expedited final hearing in cases for which it is appropriate. This may be less expensive and it may resolve medical treatment and authorization issues that illuminate and perhaps help later resolve larger issues of disability, impairment, or indemnity.

The data resulting from the year of limited mediation options in Pensacola is not scientific. It may also reflect various factors that have not been isolated or considered. But, it does support that the absence of a state mediator may not be cataclysmic. It appears that one mediator's absence does not necessarily overburden either other mediation processes or trial calendars. This experience bears consideration. 

As Florida petition volumes increase, should that trend continue, there will be greater demand for state mediator services. In the short term, the OJCC is studying how to more efficiently deliver mediation services with existing resources. But as calendars fill, parties will be faced with alternatives. One will be the statutory requirement for judges to refer cases to private mediation. The other, picking up the phone and negotiating without mediator assistance, will also persist. Counsel will need to consider which alternative best fits their perceptions of the particular case, and which best utilizes resources such as time and money.

A final consideration is always timing. If a state mediation has been scheduled, and the parties elect any of these alternatives, their decision will clear a mediation appointment on a the state mediator's calendar. It is imperative that these decisions are made and communicated to the state mediator as early in the process as possible. It is not practical for a state mediator to re-use an appointment time with a day's notice, or even ten. If parties will not use a scheduled appointment, they should advise the state mediator thirty days or more in advance. That will facilitate others in the community using that appointment. 

There will likely be challenges as petition volumes increase. If the current trend continues, there will be increased congestion of state mediator calendars. The evidence supports that counsel are able to adapt and utilize alternatives. If the filing volumes continue to increase, it is hoped that counsel and parties will consider the alternatives early, and plan their litigation accordingly.

No comments:

Post a Comment