Young Lawyers, Be Wary of Adversaries’ Bad Faith Negotiation Tactics

Young lawyers need to be cognizant of opponents using unreasonable or bad faith negotiation tactics.

No matter which side of the “v.” you’re on, it’s important to know how to identify and handle these situations. If you do not, you are doing a disservice to both your current clients and your future clients. Once you allow bad faith negotiations to proceed, you will open the floodgates for your opponent to use the same tactics in the future.

Here are some instances of bad faith negotiations and how to deftly handle them. If you can do so, you and your clients will reap both short- and long-term benefits.

Forcing you to bid against yourself

When negotiating settlements or mediating a case, the most prevalent bad faith negotiation tactic I encounter is being forced to bid against myself.

Let’s say you are engaged in back-and-forth negotiations during settlement discussions. You make a counterdemand. Rather than presenting a new offer in response, opposing counsel requests you unilaterally lower your demand further. This is what I consider a request to bid against yourself.

Do not tolerate these requests. When asked to do so, end negotiations if you must. Trust the way you originally valued the case. If your valuation is correct, then do not hesitate to walk away from a request to bid against yourself. Not only will it likely help your negotiations on the present matter, but it will send a message to your opponent that in the future, such a request is futile and a quick way to derail discussions.

It’s standard operating procedure at my firm, Pond Lehocky Giordano, to decline requests to bid against ourselves. All young lawyers should adopt this position. Unilaterally reducing your demand without an offer is a sure-fire way to become cannon fodder on future negotiations with opposing counsel.

Compelling you to reveal your true bottom-line figure

Young lawyers also need to be wary of providing their true bottom-line figure at a mediation, especially to an opposing counsel whom they have not dealt with in the past.

If you are at a mediation and the opposing counsel runs out of authority, sometimes they will request your bottom-line demand so they can take it back to their client for consideration. The large majority of the time, many opposing lawyers will never come up to your good faith number or even the recommendation of the mediator. Rather, they will undercut your bottom-line number by a significant percentage and ask you to negotiate off of that number.

If you are not familiar with your opponent’s tactics, then never give them your good faith bottom-line number. There are many defense attorneys with whom I have pleasant and trustworthy working relationships and to whom I am comfortable providing my bottom-line number. I know they will work to secure that authority (or close to it) from their client.

However, there are many opponents who have no intention of trying to meet that bottom-line number and would use it as a tactic to box me in and negotiate below my client’s comfort level.

If you do not trust your opponent or have never worked with them on other cases, be cautious and decline to provide your good faith bottom-line number. Rather, just tell your opponent to let you know if they receive additional authority and you will communicate any new offer to your client and report back their response.

There is no need to take the risk of boxing yourself in with negotiations by providing your true bottom-line number. If you feel as though providing such a number is in your client’s best interest in a certain situation, try to have the mediator endorse the number as their official recommendation for a resolution or leave some breathing room by giving a number somewhat close to your bottom-line number so you have negotiating room to move if the defense counsel attempts this bad faith tactic.

Playing fast and loose with settlement terms

Another sign of bad faith negotiations is an opponent’s attempt to alter the terms of a settlement agreement following a mediation or settlement discussions.

On occasion, I have agreed with opposing counsel at a mediation on specific settlement terms only to receive settlement documents that have altered those terms or that include clauses that are unfavorable to my client. These terms or clauses were never discussed during negotiations, and have come in the form of general releases, resignations, confidentiality clauses, waiver of benefits such as unpaid sick time or vacation time accruals, or even refusal to pay certain unpaid medical bills.

My advice to my fellow young lawyers is to carefully read settlement documents provided by opposing counsel to ensure they contain language that was mutually agreed upon. If a draft settlement agreement contains terms that were not agreed upon during negotiations, then go back to a follow-up mediation with the mediator you used. If your opponent is unwilling to abide by the terms previously reached, then walk away from the deal if doing so is in the best interest of your client. Diligent and good work for your client comes first; the money will follow.

Damages valuations that are lacking

Be careful of valuations presented by your opponent that are so lacking that they do not reflect reality.

I commonly see medical cost projections, life care plans, surgical cost estimates, and non-Medicare covered allocation reports that exclude important future medical costs that a client will need. The easiest way to combat such tactics is to get your own medical cost projections by a certified life care planner or medical cost projectionist. It’s worth the cost of getting your own report in order to compare it to your opponent’s report.

I’m often shocked to see reports prepared by my opponents that exclude big-ticket items like future surgeries, spinal cord stimulator replacements and reprogramming, and durable medical equipment—to name a few.

Don’t be tempted by opposing counsel’s bad faith tactics

As a young lawyer, it’s important to understand that if you yourself practice bad faith negotiations, not only will your opponents become unwilling to engage in settlement discussions with you (and likely your colleagues), but mediators and judges will take note of your tactics.

In many practice areas, including workers’ compensation (which is the area I practice in), the judges that mediate cases also have their own caseload. If you have a reputation for being unreasonable in negotiations and at mediations, the mediators you have engaged with in the past will probably remember such tactics when deciding future cases of yours that are before them. If a judge that has mediated your cases in the past is now deciding a borderline case where each side has a 50% chance of winning, the judge might just give your opponent the benefit of the doubt since they are aware of your unwillingness to resolve a matter amicably without smoke and mirrors.

Be careful how you engage with your opponent and any third parties, like mediators, so you do not tarnish your reputation in the legal community. Once you do so, your reputation may never be able to recover.

Be vigilant against bad faith negotiations

Bad faith negotiations come in many forms. Young lawyers need to be cognizant of negotiation tactics their opponents are using and be vigilant against the ones that appear to be in bad faith.

If you are unfamiliar with your opponent, proceed with caution. Don’t bid against yourself or divulge your bottom-line figure when you don’t have an amicable relationship with opposing counsel. Pore over settlement agreements prior to execution to ensure the terms are exactly what you agreed to. And, ensure you have done due diligence on your case valuation and stick to it for the betterment of your client.

Finally, if you have been on the receiving end of bad faith negotiation tactics, don’t do unto others as they have done unto you. Your reputation will always precede you. A tarnished one will cause damage to your practice and your ability to secure the best results possible for your clients.

Christopher D. Armstrong is an associate at Pond Lehocky Giordano LLP, the largest workers’ compensation and disability law firm in Pennsylvania, and one of the largest in the U.S. He can be reached at carmstrong@pondlehocky.com.

Reprinted with permission from the June 29, 2023 edition of The Legal Intelligencer © 2023 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-257-3382 or reprints@alm.com.