Bar Bulletin

June, 2004

 BAR BULLETIN FOCUS
 June 15, 2004

Environmental Law  

MEDIATING MESSES: A BLUEPRINT FOR MEDIATING ENVIRONMENTAL DISPUTES
By Randall M. Lutz, Patricia McHugh Lambert and Susan M. Euteneuer

By Randall M. Lutz, Patricia McHugh Lambert and Susan M. Euteneuer
Sludge. Hazardous waste. Chemicals with names too long too pronounce, much less to spell. Add the high costs of litigation due to vigorous attorneys with a “take no prisoners” attitude and zealous regulators. Couple this with a dash of publicity and a helping of uncertainty and one has the makings of a toxic goulash nightmare for a client.

Too often, environmental cases are seen as cases that are unique, overwrought with technicalities and within the exclusive purview of super-brainiac trial lawyers. Consequently, the perceived “specialness” of environmental cases often leads the client, regulators, attorneys and the courts to overlook opportunities to resolve cases early by mediation.

While using “mediation” and environmental case in the same sentence may sound like heresy to some, mediation, even early in a case, often makes sense. Mediation can stop the clock running on the inevitable paper chase on formulaic and supercilious legal arguments, avoid having experts duplicate work and allow for more focus on the important matter of remediation.

This is not to say that mediation of an environmental case is easy. Sometimes environmental lawyers with visions of billables dancing in their heads are reluctant to suggest mediation at an early stage. Sometimes courts are reluctant to push parties too hard on technical and scientific issues until the very end of discovery or delegate to special masters because of the complexity of the issues. Sometimes clients fear mediating with someone who does not know the difference between Percocet and perchloroethylene. Mediation can, however, be particularly effective in resolving environmental cases earlier in the process, provided a few points are considered.

Getting the buy-in. To clients (and their in-house counsel), there are many very appealing aspects of mediation in an environmental case (and very few downsides). They want to control fees, costs and uncertainty. The prospective investment of time by clients and their employees in litigation can be enormous. However, many clients do not know that early mediation is an option. Lawyers do not like to appear weak by suggesting mediation at an early stage of a potentially complex matter. Nevertheless, courts, administrative agencies, insurers and even clients should consider requiring the parties to sit down and attempt to resolve issues early on in a dispute. Repeated sit-down meetings should be encouraged throughout the process.

Getting to the appropriate mediator. No one wants to negotiate a multimillion dollar environmental case before a mediator who has only tried soft-tissue accident cases. Environmental cases require a mediator who by training, experience and temperament can handle difficult scientific and legal issues, as well as difficult personalities. The Environmental Protection Agency (EPA) offers “in-house neutrals” as mediators, though even the EPA recognizes the limitations of that program. There is also a growing group of private mediators who specialize in helping parties resolve environmental disputes. It is imperative to select an active and assertive mediator, rather than a passive participant.

Getting everyone to the table. Getting everyone to the table is often a Herculean task in an environmental case. Once the parties and their attorneys have bought into the process and selected a mediator, the technical experts, insurers and regulators will play critical roles in the mediation. In order for mediation to be effective, the battling experts must be involved both before and during the mediation. Unlike attorneys, practicing environmental scientists tend to narrow the technical issues in dispute among themselves, rather than employing an all-or-nothing approach. This is because such scientists often use the same methods and rely on the same universally-accepted group of authorities. Insurers who are paying the litigation bills and may have exposure for a judgment must also participate in the process. Some courts even mandate a representative with authority to be present in order to keep the process moving. Regulators may also be involved, e.g. to work out remediation standards (“How clean is clean?”).

Getting to the issues. Notice that the heading states “issues.” Environmental cases are often too big and indigestible to swallow whole in an early mediation, or in mediation at all. Nevertheless, there may be smaller, more dissectible issues that could be resolved. A segmented approach can be very effective in CERCLA (Comprehensive Environmental Response, Compensation and Liability Act) cases, which lend themselves to mediating issues of liability, categories of potentially liable parties and shares of remediation costs in stages. Getting to the issues takes work, preparation, an agenda and a good-faith commitment to the mediation process.

Getting creative. Unlike litigation, mediation provides everyone with the opportunity to promote a creative settlement. Unique remedies such as alternative forms of remediation, structured settlements, indemnities, insurance buyouts and confidentiality agreements can be part of mediated environmental resolution. Such solutions are most easily achieved before parties become overly entrenched in their positions and expend substantial funds in the litigation.

With these points in mind, mediation in an environmental case can create a win-win scenario – the cleanup occurs quickly and at a substantially reduced cost.

The authors are attorneys with Hodes, Ulman, Pessin & Katz, P.A. Randall M. Lutz, Co-Chair of the firm’s Real Estate and Environmental Practice Group, is a trained mediator for the Maryland courts and has been practicing environmental law for 30 years. Patricia McHugh Lambert, Chair of the firm’s Insurance and Financial Services Practice Group, has 20 years of experience in business litigation, environmental and insurance matters. Susan M. Euteneuer is a former insurance claims professional in environmental and coverage matters whose legal practice focuses on environmental and insurance law.

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