Last month, in Safety in Numbers, I addressed the concern that Baseball Mediation™ is “too risky,” using statistical data to quantify how narrow the risk has been — $70,000 or less, to date — for cases in which the impasse-breaking mechanism is triggered.
Since then, two closely related questions have surfaced — how close, on average, is X to the parties’ final numbers when the impasse-breaking mechanism is triggered, and what role does X play when the parties instead reach a negotiated resolution.
As a reminder, and for those still not familiar with Baseball Mediation™, X is the mathematical midpoint between what I refer to as the “Projected Minimum” and “Projected Maximum” of an objectively reasonable and realistic settlement range — based on my pre-mediation conferences, review of the briefs and interactions with the parties and counsel at the outset of the mediation.
The projections are recorded on the Baseball Mediation Worksheet (the “Worksheet”), with X as the central component of the impasse-breaking mechanism. The Worksheet is emailed to counsel in a password-protected format, and X remains hidden unless the parties reach a final impasse.
If the parties do reach a final impasse, the password is shared and X is revealed. The party whosefinal number is closer to X prevails, and their number becomes the amount of the settlement.
Statistically, the average percentage difference between X and the prevailing party’s final number is 6.5% and the largest dollar differential to date — occurring in a seven-figure case — is $51,000.
In contrast, X plays no formal role — and remains hidden — if the parties reach a negotiated resolution. Nevertheless, its reliability is still relevant because of the psychological role it plays.
To confirm the reliability of X in matters resolved through negotiation, I’ve prepared Worksheets in hundreds of “non-Baseball” mediations — without knowing whether, when, or for how much the matter might ultimately resolve — and compiled the results.
To date, across 272 cases in the six- and seven-figure range in which a Worksheet was prepared and the parties thereafter reached a negotiated resolution, the median percentage difference between X and the final settlement amount has been less than 10%, further support for the conclusion that Baseball Mediation™ is an entirely safe, predictable, and reliable process.
While the proximity of X to the settlement amount engenders greater confidence, it remains the inherent uncertainty surrounding X that ultimately shapes the parties’ negotiating behavior once they stipulate to the process.
In Baseball Mediation™, the true X factor is its invisibility.
As always, it would be my pleasure to assist you and your clients in the dispute-resolution process. I’d welcome the opportunity to be of service.
Best regards . . .
Floyd J. Siegal
Postscript
For those who haven’t previously tried Baseball Mediation™ and are curious to experience the process firsthand, I invite you to do so — at no cost — for any matter in which neither counsel has tried it before. You’re welcome to contact me directly for details and/or to schedule the session on a mutually convenient Wednesday.