[Federal Register: July 15, 1996 (Volume 61, Number 136)]
[Notices]
[Page 36895-36913]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15jy96-86]
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DEPARTMENT OF JUSTICE
Office of the Senior Counsel for Alternative Dispute Resolution
Policy on the Use of Alternative Dispute Resolution, and Case
Identification Criteria for Alternative Dispute Resolution
AGENCY: Office of the Senior Counsel for Alternative Dispute
Resolution, Justice.
ACTION: Notice.
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SUMMARY: This notice publishes the Alternative Dispute Resolution
Policy Statements prepared by each of the civil litigating components
in the Department of Justice as well as their criteria for identifying
cases as potentially suitable for dispute resolution. As indicated in
the introduction by the Attorney General, these documents were prepared
by teams of staff attorneys within each of the components. Each
document reflects the nature of the practice of that component. These
documents have been provided to all staff attorneys in the Department
of Justice who handle civil litigation, in Washington and in United
States Attorneys' Offices, and are being published in the Federal
Register to make clear the Department's commitment to greater use of
alternative dispute resolution. Nothing in these documents, however,
creates any right or benefit by a party against the United States.
FOR FURTHER INFORMATION CONTACT:
Peter R. Steenland, Jr., Senior Counsel for Alternative Dispute
Resolution, United States Department of Justice, Room 5708, Washington,
DC 20530. (202) 616-9471.
Dated: June 17, 1996.
Peter R. Steenland, Jr.,
Senior Counsel, Alternative Dispute Resolution.
ADR Federal Register Introduction
On April 6, 1995, I issued an Order directing greater use of
Alternative Dispute Resolution by the Department of Justice. In
part, that Order required our civil litigating components to provide
their attorneys with policy guidance on the use of Alternative
Dispute Resolution techniques and directed them to develop case
selection criteria for using ADR in appropriate cases. Our
commitment to make greater use of ADR is long overdue. Clearly, our
federal court system is in overload. Delays are all too common,
depriving the public of swift, efficient, and just resolution of
disputes. The Department of Justice is the biggest user of the
federal courts and the nation's most prolific litigator. Therefore,
it is incumbent upon those Department attorneys who handle civil
litigation from Washington and throughout the country to consider
alternatives to litigation.
The Guidance documents for using Alternative Dispute Resolution
were prepared by teams of attorneys in each of the components. Each
policy statement and set of case selection criteria reflect the many
varied types of litigation in which we represent the United States,
federal agencies and federal officials. Each component head has
approved the policy statement and case selection criteria, and has
expressed a commitment to making greater use of Alternative Dispute
Resolution. Working with our Senior Counsel
[[Page 36896]]
for Alternative Dispute Resolution, I expect our attorneys to
implement our commitment to use ADR in appropriate cases. It is also
my expectation that their ability to use ADR will be given as much
recognition within the Department and elsewhere as their present
contributions as dedicated and resourceful litigators.
If we are successful, the outcome will benefit litigants by
producing better and quicker results, and will benefit the entire
justice system by preserving the scarce resources of the courts for
the disputes that only courts can decide. I urge everyone to work
with us in this important civil justice reform effort.
Today, I am making available all of the Department's ADR case
selection criteria developed pursuant to the Order. These criteria
relate to the government's voluntary participation in ADR. Nothing
in these Guidance documents shall be construed to create any right
or benefit, substantive or procedural, enforceable at law or in
equity, by a party against the United States, its agencies, its
officers or any other person. For further information contact: Peter
R. Steenland, Jr., Senior Counsel for ADR, U.S. Department of
Justice, Room 5708, Washington, DC 20530. Phone: (202) 616-9471.
Janet Reno,
Attorney General.
To: All Section and Field Office Chiefs, Antitrust Division.
From: Anne K. Bingaman, Assistant Attorney General, Antitrust Division.
Re: Use of Alternative Dispute Resolution Techniques.
On April 6, 1995, the Attorney General issued the attached order
directing Department-wide initiatives to promote greater use of
Alternative Dispute Resolution (``ADR'') techniques in civil
litigation. Under the AG Order, ADR techniques are defined to include
arbitration, mediation, early neutral evaluation, neutral expert
evaluation, mini-trials, and summary jury trials--essentially those
techniques that employ the services of a third-party neutral to assist
in the conciliatory resolution of a dispute. The ADR techniques
addressed in the AG Order have the potential to eliminate unnecessary
civil litigation, shorten the time that it takes to resolve civil
disputes, and achieve better case resolutions with the expenditure of
fewer resources.
General Policy
Although the Antitrust Division has an excellent record of settling
its civil cases through the use of unassisted negotiations, the
application of ADR techniques in appropriate circumstances to the
negotiation process has the potential to provide even better results.
Just as it is important for our attorneys to develop good advocacy and
litigation skills, and to be accomplished negotiators during settlement
discussions, it is also important that they become knowledgeable
concerning ADR techniques so that the Division can take advantage of
the benefits that ADR provides.
It is, therefore, the policy of the Antitrust Division to encourage
the use of ADR techniques in those civil cases where time permits and
there is a reasonable likelihood that ADR would shorten the time
necessary to resolve a dispute or otherwise improve the outcome for the
United States. Because of the time constraints imposed by the H-S-R Act
and the exigencies of the merger review process in general, ADR
techniques will likely be difficult to apply during the course of
merger investigations. On the other hand, non-merger investigations
often have more timing flexibility. In order better to assess the
potential for ADR to shorten the resolution time for such
investigations or otherwise to improve their outcome, I am directing
the chiefs of sections and offices conducting civil, non-merger
investigations to work closely with Becky Dick to identify cases where
ADR can be tried at different stages of the investigative process
(e.g., prior to the issuance of CIDs; during settlement negotiations)
as test cases, to provide a basis for comparison and to help serve as a
guide to future use of ADR by the Division.
Please be assured that in implementing this ADR policy, the
Antitrust Division will recognize the contributions made by staff
attorneys who handle matters in ADR by providing the same opportunities
for promotion, awards, and other professional recognition as those
engaged in more traditional litigation. Often, ADR will accelerate
settlements, avoid trials, and provide enhanced resolution of disputes
that litigation cannot provide. Those who use ADR to these ends will be
evaluated on their skills in these endeavors, and they will be
recognized for the contributions they have made to the Department and
the public.
Case Selection Criteria
In order for this policy to work, it is necessary that our
attorneys become knowledgeable about the types of ADR techniques that
are available and sensitive to the possibilities that they offer for
improving antitrust civil enforcement. To assist this effort, I am
today issuing case selection criteria to aid in selecting the types of
cases and the types of ADR techniques that are appropriate for
resolving various issues and impasses that can arise during the course
of civil investigations. For example, at the beginning of an
investigation, prior to the issuance of a CID to the subject, it might
be appropriate to engage in discussions with the subject about the
nature of the Division's concerns, the type of information that we will
be seeking, etc., in order to better formulate our CIDs, reduce
compliance disputes, and speed the resolution of the investigation. A
third-party neutral could be used to facilitate these discussions. This
will not always be useful or lead to a better result, and there will be
circumstances where various factors militate against employing ADR. But
I believe that the best way initially to asses the value of ADR for the
Division is actually to use it in some cases and evaluate the results.
Training Requirement
Acknowledging that ADR is a new concept for many Department
attorneys, the AG Order requires attorneys who have substantial civil
litigation responsibilities to receive regular training in negotiation
and ADR techniques. We will be working with the Department's Senior
Counsel for ADR to identify the training needs for Antitrust Division
attorneys in this area in light of the results of our experience in the
use of ADR as it develops.
In sum, ADR is another litigation tool that we have at our
disposal. In appropriate circumstances it can help to enhance our
investigation and negotiation efforts, conserve resources, and achieve
better civil antitrust enforcement results.
Attachments
To: All Section and Field Office Chiefs, Antitrust Division.
From: Anne K. Bingaman, Assistant Attorney General, Antitrust Division.
Re: Case Selection Criteria for the Use of Alternative Dispute
Resolution (``ADR'') in Antitrust Division Civil Litigation.
The Administrative Dispute Resolution Act of 1990 (``ADR Act''),
Pub. L. No. 101-552, 104 Stat. 2736-48, and Attorney General Order OBD
1160.1, ``Promoting the Broader Appropriate Use of Alternative Dispute
Resolution Techniques,'' (April 6, 1995) require careful consideration
of the use of alternative means of dispute resolution by Antitrust
Division personnel during the course of investigating, settling, and
litigating civil disputes. ADR can be defined as any technique that
results in the conciliatory resolution of a dispute, including
facilitation, mediation, fact
[[Page 36897]]
finding, minitrials, early neutral evaluation, and arbitration. While
unassisted negotiation is a well understood dispute resolution
technique that is frequently successfully employed within the Antitrust
Division, other ADR techniques--techniques that require the use of a
third-party neutral--have received much less attention. These
``formal''ADR techniques are the focus of the AG Order and this policy
memorandum, which is intended to provide guidance to Antitrust Division
attorneys in identifying civil cases that are possible candidates to be
resolved through the use of formal ADR techniques.
As you are aware, federal courts are increasingly likely to require
parties to disputes to consider the use of ADR in cases that do not
settle rapidly following the filing of a complaint as part of a court-
annexed ADR program. However, the use of ADR may also be of real value
prior to the filing of a complaint as an aid to the settlement
negotiation process.\1\ ADR is not intended to replace traditional one-
on-one negotiations, but rather to provide attorneys with additional
tools that may facilitate negotiation where traditional two-party
negotiation has not produced an acceptable resolution. In appropriate
circumstances, ADR techniques can be used in conjunction with
unassisted negotiation to resolve particular issues if, in the
estimation of the parties, such ADR techniques would likely result in a
speedier resolution of the overall dispute, increase the likelihood
that the dispute will be resolved short of litigation, or result in a
better resolution of the dispute than would otherwise be obtained.
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\1\ In light of the congressional directive contained in the
Antitrust Procedures and Penalties Act of 1974 (``Tunney Act'') that
consent judgments in civil antitrust cases entered into by the
Antitrust Division be publicly aired and approved by a federal judge
as being in the public interest, see 15 U.S.C. 16 (b)-(h), civil
investigations that result in a determination by the Division that
an antitrust violation has occurred should ordinarily not be
resolved without the filing of a complaint. (Merger investigations
where the proposed transaction has been abandoned and there is no
reasonable likelihood of that transaction being renewed within the
time period for which the existing H-S-R filing remains valid are an
exception.) When the Division and opposing parties are able to agree
on the appropriate resolution of a dispute prior to the institution
of litigation, the disposition of that dispute through the filing of
a complaint and simultaneous consent decree is consistent with the
goals of the ADR Act, the AG Order, and the Tunney Act.
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Available ADR Techniques
A variety of ADR techniques exist that make use of the presence of
a third-party neutral to assist in the negotiation or litigation
process. The following are the most common:
<bullet> Mediation
<bullet> Non-binding settlement process facilitated by a neutral
who does not impose a resolution.
<bullet> Neutral has no authority to impose decision.
<bullet> Neutral meets with parties in joint session and in
separate sessions to facilitate resolution that is acceptable to all
parties.
<bullet> Can be used to narrow issues for trial.
<bullet> Early Neutral Evaluation (ENE)
<bullet> Gives non-binding prediction of outcome.
<bullet> Most useful in disputes involving specific legal issues.
<bullet> Most useful if neutral is a recognized expert in the
particular subject area or area of law.
<bullet> Neutral Expert Factfinder
<bullet> Makes findings of fact on specific issues.
<bullet> Most useful in factual disputes.
<bullet> May be binding or non-binding depending upon agreement of
the parties.
<bullet> Can be used to narrow factual issues for trial.
<bullet> Mini-trial
<bullet> Non-binding presentation of highlights of case by
attorneys for each party to their decision makers in mock trial
setting.
<bullet> May include some witnesses and testimony.
<bullet> Facilitated by a neutral who presides over presentation,
engages parties in litigation risk analysis, and facilitates settlement
discussions.
<bullet> After presentation of the case, neutral meets with parties
to facilitate settlement.
<bullet> Allows decision makers to focus on and analyze their
cases.
<bullet> Arbitration
<bullet> Can be binding or non-binding depending upon agreement and
nature of the parties.
<bullet> Neutral or panel of neutrals who impose a decision or
resolution.
<bullet> Is most adjudication-like of ADR processes.
<bullet> May be more costly than other forms of ADR if it involves
discovery, witnesses, and the presentation of the case.
It is important to appreciate the diversity and flexibility of
available ADR techniques. Some ADR techniques, such as ENE or
arbitration, involve the neutral in making evaluations of the
respective parties claims or the strengths and weaknesses of their
legal theories or evidence. Other techniques, such as mediation, use
the neutral simply to facilitate the parties' negotiations without
being in any way judgmental.
Neutrals only perform those functions agreed upon by the parties,
and only for so long as both parties believe that the presence of the
neutral is of value. Neutrals can be brought in at the beginning of a
negotiation to get the ball rolling smoothly or after a particular
problem has arisen to help resolve that problem amicably, and they can
be dismissed if they are not proving useful or after a predetermined
period of time. Parties do not lose control by employing a third-party
neutral; if anything they gain control, especially if the application
of ADR techniques enable the parties to avoid the litigation process.
Factors To Consider in Selecting an Appropriate ADR Technique
In those instances where a case is a good candidate for ADR, each
of the available ADR techniques can be used effectively to break a
litigation or negotiation deadlock, depending on the nature of the
dispute that needs to be resolved. In reaching a decision concerning
the selection of a particular ADR technique in any given case, there
are a number of factors to consider.
<bullet> What is the nature of the problem that is preventing a
consensual resolution of the dispute?
<bullet> Hostility/lack of communication between the parties.
<bullet> Technical or complex factual issues.
<bullet> Legal issues.
<bullet> Settlement issues.
<bullet> What would it take to break the negotiation stalemate?
<bullet> Intervention by a neutral party to diffuse hostility.
<bullet> Neutral evaluation of dispositive factual issues.
<bullet> Neutral evaluation of dispositive legal issues.
<bullet> Neutral evaluation of dispositive settlement issues.
<bullet> Presentation by each side of its case to party decision
makers.
<bullet> What resource constraints do the parties face?
<bullet> Is there sufficient time available to employ a given ADR
technique? Can the parties agree to an extension of time in order to
attempt ADR?
<bullet> Do the parties have the financial resources to employ a
given ADR technique?
<bullet> What practical constraints do the parties face?
[[Page 36898]]
<bullet> Have either of the parties expressed a willingness or a
hostility to engaging in ADR?
<bullet> Do either of the parties have any history of using ADR?
<bullet> Are the attorneys handling the investigation/litigation
experienced with one or more ADR techniques?
Of course, not every case or situation is appropriate for the use
of ADR. There are a variety of factors that can be considered as either
supporting the use of ADR or making the use of ADR less likely in a
particular case.
Factors Favoring ADR
The Parties
<bullet> Continuing Relationships
The United States, aggrieved persons, or other litigants are likely
to have continued contact with the defendants in implementation of the
remedy or in other contexts.
<bullet> Barriers to Communication
The United States or other litigants foresee impasses developing
because of conflicts within interest groups, political visibility, or
poor or non-existent communication among the participants (including
attorneys) due to personality difficulties or past history.
<bullet> Absent Stakeholder(s)
Participation of persons or groups who are not directly involved in
the legal action may be beneficial or necessary to a optimal
resolution.
<bullet> Divergence of Interests
There are gains and losses to be apportioned constructively, and in
which varying priorities among the parties will allow trading off of
those gains and losses to permit all involved to benefit from the
outcome.
<bullet> Numerous Parties
The number of parties or interested persons or groups is so
numerous that a structured/facilitated negotiation process would be
helpful.
Nature of the Case
<bullet> Need for Problem Solving or Development of Creative
Alternatives
A thorough exchange of information and generation of alternatives
and options will improve the outcome.
<bullet> Factural or Technical Complexity or Uncertainty
The parties would benefit from reliance on the expertise of a
third-party expert for technical assistance and/or fact-finding.
<bullet> Need for Facilitated Private Discussions
The settlement desired may be improved by the neutral's ability to
conduct frank, private discussions among the parties.
<bullet> Flexibility Desired in Shaping Relief
The United States is seeking relief with detailed implementation
and/or monitoring on multiple issues or subjects that may be difficult
to obtain from the Court, or is amenable to resolution through
cooperation between the parties.
<bullet> Ultimate Outcome Uncertain
Litigants face uncertain outcome at the time of trial based on the
law, the facts, or the decisionmaker. Also important is the likelihood
of prevailing on appeal should the United States lose at trial.
<bullet> Hostile Decisionmaker
Case will be tried in front of an unsympathetic judge, or jury
venire is likely to be unsympathetic or even hostile.
<bullet> Conservation of Enforcement Resources
Preparing the case for trial would require a burdensome commitment
of significant resources without achieving a proportionate impact.
<bullet> Numberous Issues
Discussion of multiple issues will be assisted by a structured/
facilitated negotiation process.
<bullet> Direct Settlement Negotiations Unsuccessful
The United States has attempted traditional settlement negotiations
without success or an impasse has been reached and the United States
believes involvement of a third-party neutral will facilitate further
progress and/or final resolution.
Representation
<bullet> Need to Speak Directly to Client
The parties (or aggrieved persons) need to hear an evaluation of
the case from someone other than their lawyers.
<bullet> Lawyers Are Willing To Consider ADR
The lawyers involved are knowledgeable about ADR processes and
intend to participate in the chosen ADR process in a good-faith attempt
to resolve the dispute.
Timing
<bullet> Facts Are Sufficiently Developed
The parties have sufficient information to permit them to make
informed decisions concerning the ultimate disposition of the dispute.
<bullet> Parties Are Prepared to Discuss Settlement
The parties are willing to resolve the case short of trial.
Factors Disfavoring ADR
<bullet> Public Sanction Necessary
There is a need for public sanctioning of conduct.
<bullet> Imbalance of Power or Ability
A party or parties are not able to negotiate effectively themselves
or with assistance of counsel.
<bullet> Judicial Decision Required
Development of the law is important or the imprimatur of a court
decision is necessary to secure vindication of rights, enforcement, or
compliance.
<bullet> Biased Selection Process of ADR Neutral
Political sensitivity of case coupled with questionable neutral
selection process would likely result in selection of ``neutral'' with
ties to interests contrary to the United States.
<bullet> Successful Summary Judgment Certain
<bullet> Case Likely To Settle Through Unassisted Negotiation in Near
Future * * *
Using these selection criteria as a guide, it should be possible to
identify Antitrust Division cases that would benefit from the
application of ADR, and to identify the most appropriate ADR technique
to assist the investigation/litigation process. Although many civil
cases brought by the Antitrust Division will not be good candidates for
ADR--for example, most merger investigations will face time constraints
that make the use of ADR impossible, and many of our non-merger cases
move swiftly and smoothly to resolution--there will be instances where
one-on-one settlement negotiations may benefit from the presence of a
neutral, either from the start or once they have reached an impasse,
time is available, and a third-party neutral would advance the case
more effectively than simply involving higher-level Division officials
or permitting a cooling-off period. There may also be instances where
involving a neutral expert could resolve a factual
[[Page 36899]]
or legal dispute at the negotiation stage in a manner that would either
speed the resolution of the case or result in a more favorable outcome
for the United States than would unassisted negotiations or litigation.
Such cases should be considered for the use of ADR.
The issuance by the Antitrust Division of case selection criteria
for the use of alternative dispute resolution relates solely to the
government's voluntary participation in ADR. Nothing herein shall be
construed to limit the government's duty to participate in ADR
according to court order or applicable local rules, except that
Antitrust Division attorneys shall resist participation in ADR, by
appropriate motion, whenever said participation would violate the
United States Constitution or other governing law.
This memorandum shall not be construed as creating any right or
benefit, substantive or procedural, enforceable at law or in equity, by
a party against the United States, its agencies, its officers, or any
other person. This memorandum shall not be construed to create any
right to judicial review involving the compliance or noncompliance of
any Antitrust Division attorney with its terms.
CIVIL DIVISION--STATEMENT ON ALTERNATIVE DISPUTE RESOLUTION
Introduction
On April 6, 1995, the Attorney General issued an order promoting
the broader use of alternative dispute resolution techniques for the
Department of Justice's litigating divisions in appropriate matters.
The order requires each litigating division handling civil matters to
issue: a policy statement on ADR; case selection criteria identifying
appropriate cases for ADR; criteria for the selection of ADR providers;
training requirements in negotiation and ADR; a statement on internal
procedures for authorization and funding of ADR; and finally a
reporting system for statistics on each division's use of ADR.
I. POLICY
The Civil Division is fully committed to encouraging consideration
of alternative dispute resolution (``ADR'') in appropriate cases and
implementing all aspects of the Attorney General's April 6th Order on
ADR. ADR is any consensual dispute resolution process facilitated by
third-party neutrals which can be utilized prior to or during
litigation. ADR is not meant to replace traditional litigation or
unassisted negotiation, but rather is meant to supplement them. In
other words, ADR is another tool to resolve disputes and can provide
unique advantages. ADR can be used when traditional negotiation is
likely to be unsuccessful, has already been unsuccessful, or when it
can expedite negotiations and/or allow them to proceed more
efficiently. ADR can be used to resolve discrete parts of a particular
case or, a series of cases; it can help narrow and/or eliminate issues;
it can expedite critical discovery; and can help the parties gain a
better understanding of the strengths and weaknesses of the case. ADR
provides flexibility by allowing the parties to fashion their own
resolutions to disputes--creative resolutions beyond what courts can
offer.
In a similar vein, ADR allows the parties to fashion their
procedures for resolving disputes. There are as many ADR processes as
the parties can create. The most widely used ADR techniques are
mediation, early neutral case evaluation, arbitration, mini-trial and
summary jury trial (see attached appendix for descriptions).
Consideration of whether ADR can be beneficial to a particular matter
should begin as soon as a Civil Division attorney is assigned to a
case, should be ongoing, and should be revisited at the watershed
points in the litigation. Different forms of ADR may be useful at
particular points in the case.
In analyzing a case for ADR and considering the particular
component's case selection criteria, some general considerations should
be kept in mind. the factors listed below for each Civil Division
component will not all be relevant in any given case. Factors not
listed may also be present that weigh in favor of or against the use of
ADR. A threshold inquiry should be whether ADR will be beneficial to a
case; that is, whether it will be more cost efficient, faster or will
enhance the opportunities for a better result than would be the case
with traditional litigation or unassisted negotiation. Even if the
threshold inquiry is negative, consideration should still be given to
whether ADR can be of benefit to a case even if it does not settle or
entirely resolve the matter. For instance, if ADR can narrow the issues
or expedite critical discovery, then ADR should be considered. In
selecting a particular ADR process, each Civil Division component has
listed a series of factors to evaluate for this selection, and there
may be more than one ADR process appropriate for an individual case.
Attorneys should also consider the different ADR processes that the
relevant district or circuit court programs provide or require. Even
where a particular district has an ADR program, Civil Division
attorneys should employ the analysis in this statement.
In determining whether a case can benefit from ADR, there are no
hard and fast rules. It bears emphasizing that the use of ADR is not
mandated, and the determination to use ADR and the selection of the
particular ADR process should be done on a case-by-case basis. Because
an understanding of the nature of the particular litigation is critical
to an ADR assessment, and because the Civil Division handles such a
wide variety of litigation, included below is a description of each
Civil Division component's caseload.
Finally, it is the policy of the Civil Division to recognize the
work made by staff attorneys who handle matters in ADR by providing the
same opportunities for promotion, awards and other professional
recognition as those engaged in more traditional litigation. Often, ADR
will accelerate settlements, avoid trials, and provide enhanced
resolution of disputes that litigation cannot provide. Those who use
ADR to these ends will be evaluated on their skills in these endeavors,
and they will be recognized for the contributions they have made to the
Department and the public.
Commercial Litigation Branch: The Commercial Litigation Branch is
the largest of the litigating components, accounting for 39% of the
Division's caseload. Its cases consists of both affirmative and
defensive work regarding financial disputes between the government and
private parties. It has four principal litigating units:
The Fraud unit files affirmative litigation, usually under the
False claims Act. Last year it recovered over 1 billion dollars. Almost
90% of its cases settle and approximately half of those are completed
prior to filing a complaint. The nature of the cases indicates that
they are good candidates for ADR mechanisms.
The Court of Federal Claims unit defends suits brought by
contractors, (usually as the result of an adverse decision by an agency
contracting officer,) and defends appeals filed by government employees
from decisions of the Merit Systems Protection Board. They settle
approximately 30% of their cases and win the majority of the balance on
motions. Both types of cases follow administrative reviews which have
afforded the parties settlement opportunities. Although personnel cases
can often benefit from third party neutral participation, these cases
are small and are almost always disposed of in favor of the government
on routine motions. In addition OPM, the client in most cases, would
like to see their
[[Page 36900]]
decisions, which have been the result of a rather lengthy
administrative process, upheld. (Cases that have merit are usually
disposed of in that administrative process.) Likewise, many contract
cases are weeded out by dispositive motions on the basis of the Court's
limited jurisdiction. However, the remaining complex contract actions
can make use of not only mediation but informal fact finding and
neutral evaluation procedures. The Court of Federal Claims has a
standing order that provides for two modes of ADR. Other forms of
consensual ADR are encouraged by the court.
The Corporate/Financial Litigation unit litigates both affirmative
and defensive cases, including complex contractual and financial
matters, bankruptcies and large foreclosure proceedings. These cases
can often benefit from ADR mechanisms.
The Intellectual Property unit litigates matters involving patents
and copyright issues. These are highly technical. They are often
complex, especially regarding damage calculations.
The Torts Branch: The Torts Branch is responsible for defending
government agencies and employees in tort suits and administrative
claims. It is subdivided into four litigating sections, General Torts,
Constitutional and Specialized Torts, Environmental Torts and Aviation
and Admiralty.
The General Torts Staff's workload includes a broad array of
traditional tort litigation (automobile cases, premise liability and
medical malpractice). In addition, the FTCA Staff is responsible for
conducting major litigation involving claims arising from financial
institution failures and AIDS related tort suits. This Staff also
handles highly visible suits that are likely to set significant
precedents, involve large sums or are especially sensitive because of
the factual context in which they arise.
Constitutional and Specialized Torts (CST) is responsible for
representing present and former high ranking officials and other
employees who are personally sued for monetary damages as a result of
actions taken in the course of their duties. CST handles cases filed
under the National Vaccine Injury Compensation Program, which involve
allegations of injuries and death which are claimed to have been caused
by the administration of certain childhood vaccines. This section also
reviews and adjudicates claims brought by individuals under the
Radiation Exposure Compensation Program. These claims involve injuries
which are alleged to have been caused by radiation exposure from
atmospheric nuclear testing and from employment related to the mining
of Uranium.
The Environmental Torts Section defends the United States in
environmental contamination suits alleging personal injury and property
damage as a result of alleged exposure to chemicals, asbestos,
radiation and other environmental toxins. Typical suits allege
negligence on behalf of the United States and/or its contractors in
operating installations and industrial facilities throughout the
nation. The cases are complex and rely heavily on expert scientific and
medical evidence to protect out interests.
The Aviation and Admiralty section handles defensive and
affirmative claims. Aviation litigation results from private, military
and air carrier operations and accidents and from the Government's
responsibility for air traffic control, airport and aircraft
certification and weather information distribution. In Admiralty, on
the defensive side, the cases involve collisions at sea, groundings,
seaman's injury, search and rescue and other actions relating to the
Government's regulation of the nation's waterways. On the affirmative
side, the cases include mortgage foreclosure, oil pollution and damage
to Government property. The admiralty section also handles cases filed
in district courts involving maritime contracts, both defensive and
affirmative.
The Federal Programs Branch: The Federal Programs Branch of the
Civil Division is a large law office with a diverse civil practice
representing over 100 federal agencies. The Branch defends against
major suits challenging the constitutionality of statues and the
constitutionality and validity under the Administrative Procedure Act
of government policies and programs; major Administration initiatives;
and agency decisions, orders, and regulations. The Branch also handles
significant government personnel litigation, including employment
discrimination claims in federal district court and adverse action
challenges before the Merit Systems Protection Board (when the
Department of Justice is sued) and before federal district courts.
Certain APA and personnel actions are amenable to ADR, especially those
involving ongoing working relationships. The Branch also personally
handles significant government information lawsuits, such as those
brought under the Freedom of Information Act and the Privacy Act. About
ten percent of the Branch's workload involves affirmative litigation to
prevent interference with government operations and enforce various
statutes and regulations such as banking laws, the National Highway
Traffic Safety Act, and the Ethics in Government Act.
Office of Consumer Litigation: The Office of Consumer Litigation
(OCL) is responsible for enforcement of Federal consumer protection
statutes, most of which provide for both civil and criminal remedies.
OCL principally handles affirmative litigation. OCL receives most of
its case referrals from the Food and Drug Administration, the Federal
Trade Commission, the Consumer Product Safety Commission, and the
National Highway Transportation Safety Administration. Approximately
73% of OCL attorney hours are spent on FDA cases (the approximately 409
pending FDA cases include both civil and criminal enforcement actions
and defensive matters).\1\ The Office also handles approximately 25
appellate cases per year.
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\1\ All statistics are for fiscal year 1994.
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Referrals from the FDA involve the illegal production,
distribution, and sale of misbranded and adulterated drugs, medical
devices, and foods. In pursuing these affirmative enforcement actions,
OCL seeks a variety of remedies under the Food Drug and Cosmetic Act
(FDCA), including seizures, injunctions, and criminal prosecutions.
While OCL does not seek monetary relief in FDA affirmative cases, ADR
techniques may nonetheless prove effective in obtaining expeditious
civil settlements. OCL also handles a number of cases defending FDA.
The majority of FDA defensive cases are administrative and
constitutional challenges to FDA statutes and regulations. These cases
rarely settle as both parties need a judicial resolution.
Referrals from the FTC typically involve allegations of FTC Rule
violations (e.g. FTC's Franchise Rule, Used Car Rule, and Funeral Rule)
or charges of false advertising. In pursuing these affirmative
enforcement actions, OCL seeks a variety of remedies under the FTC Act,
including civil penalties, consumer redress, and injunctions (which
often require the defendants to modify and reform their consumer
disclosure practices). Approximately 11% of OCL attorney hours are
spent on FTC cases (the approximately 72 pending FTC cases include both
FTC Rule and false advertising cases). Those cases are quite suitable
for most ADR techniques.
CPSC referrals constitute a small fraction of OCL's case load.
Approximately 3% of OCL attorney hours are spent on CPSC cases (the
approximately 11 pending CPSC cases
[[Page 36901]]
includes civil actions seeking civil penalties, consumer redress, and
injunctions; OCL handles few CPSC criminal enforcement actions). NTSHA
referrals involve criminal matters.
The Office of Immigration Litigation: The Office of Immigration
Litigation (OIL) is responsible for civil trial and appellate
litigation concerning immigration and nationality matters, ranging from
high seas interdiction and alien detention, deportation and exclusion,
visa and naturalization suits, to document fraud and litigation arising
under the employer sanction provisions that affect citizens as well as
aliens. OIL has both affirmative and defensive litigation
responsibilities, and represents the Immigration and Naturalization
Service, Department of State, Executive Office of Immigration Review,
and other agencies that regulate the movement of aliens across and
within U.S. borders. A number of factors and statutory obligations make
this type of litigation unique and generally unsuited to most ADR
programs. OIL defends government policies relating to immigration that
have broad implications for the nation. They also defend against
challenges to the constitutionality of statutes, regulations, and
government programs, as well as agency decisions and orders. ADR
techniques may be appropriate in settling suits challenging certain
operational decisions in the INS districts, where the agency may have
some flexibility and the outcome may be guided by existing legal
precedent, or in resolving attorney fee disputes. The majority of OIL's
cases, however, are: (1) statutory, constitutional, and regulatory
challenges to the enforcement of immigration laws and policy which
rarely settle; and (2) petitions for review challenging orders of
deportation and exclusion, which are preceded by lengthy administrative
proceedings during which the record is established, and where there is
little to no flexibility for either outcome or relief (especially as
most meritorious cases and applications for relief are resolved prior
to this stage by agency adjudication), and where any opportunity for an
additional procedure is more likely to result in an unwarranted delay
of deportation than to speed resolution of the case.
The Appellate Staff: The Appellate Staff handles appeals in cases
litigated by the individual Civil Division components, as well as by
United States Attorneys' Offices. Most of the work emanates from the
Torts, Federal Programs, and Commercial Litigation Branches, with a
much smaller number of appeals from the Office of Consumer Litigation
and the Office of Immigration Litigation. The Appellate Staff also
handles petitions for direct review in the courts of appeals
challenging agency actions. While most of the appeals involve defensive
litigation (defending statutes, regulations, agency decisions, civil
rights/personnel actions), some of the Office's appeals are based on
affirmative litigation (e.g., FDA enforcement, enforcement of the
federal trade laws, civil penalty actions). Many of the cases that are
good candidates for ADR at the district court level are also good
candidates for ADR in the Court of Appeals.
II. Case Selection Criteria
A. Criteria for the Commercial Litigation Branch
In applying the below criteria, it is important to consider the
development of the facts and whether any particular ADR mechanism is
appropriate at the particular time to assist in a resolution of the
case, or assist in the development of the facts toward a faster and
more efficient resolution. Consideration should be given throughout the
litigation to appropriate ADR assistance.
1. Factors Counseling in Favor of ADR
(a) The Parties
(1) There is a continuous relationship
(2) There may be benefits to either client hearing directly from
the opposing side
(3) Either party would be influenced by opinion of neutral third
party
(4) The opposition does not have a realistic view of the case
(5) The parties have indicated that they want to settle
(6) Either party needs a swift resolution
(b) Nature Of The Case
(1) Complex Facts
(2) Technical complexity
(3) Hostile forum or decisionmaker
(4) Flexibility in desired in relief
(5) Trial preparation will be difficult, costly or lengthy
(6) Need to avoid adverse precedent
2. Factors Counseling Against ADR
(a) Need for precedent
(b) Need for public determination or sanction
(c) Case likely to settle soon without assistance
(d) Case likely to be resolved efficiently by motion
(e) Opposing counsel are not trustworthy
B. Criteria for ADR Use in Torts Branch
In applying the below criteria, it is important to consider the
development of the facts and whether any particular ADR mechanism is
appropriate at the particular time to assist in a resolution of the
case, or assist in the development of the facts toward a faster and
more efficient resolution. Consideration should be given throughout the
litigation to appropriate ADR assistance.
1. Factors Counseling for ADR
(a) Seeking monetary relief is sole purpose of lawsuit
(1) Any unfavorable precedent may be established
(2) There are multiple defendants, with the United States having
the greatest exposure
(3) There are no dispositive legal precedents established or
desired
(4) Reasonable probability of unfavorable resolution of factual
issues
(5) Where at various stages of the litigation, an evaluation shows
that the future costs of discovery and litigation would be greater than
the amount of the settlement
(6) In affirmative cases, there will be an unacceptable delay from
the time suit is filed until payment
(7) Multiple party litigation desiring intermediate mediation to
reduce the number of parties and/or issues
(8) In affirmative cases, the defendant is uninsured or under
insured
(b) Non-monetary relief sought
(1) Injunctive relief is not necessary even though desired
(2) A declaratory judgment is not necessary even though desired
2. Factors Counseling Against ADR
(1) Need to obtain/maintain legal precedent
(2) No liability on part of United States based on facts and/or
well-established precedent
(3) Case is anticipated to be one of many
(4) Subject to a motion to dismiss in lieu of answer
(5) Subject to a motion for summary judgment once facts are
developed, where costs of proceeding are less than plaintiff would take
in settlement
(6) Individual is sued in his personal capacity as a Government
employee
(7) A case involving the seizure of property to pay a debt where
the property is the only source of revenue
(8) Injunctive relief sought where no compromise or relief
available
(9) Case is likely to settle soon without ADR
C. Criteria for the Office of Consumer Litigation
In applying the below criteria, it is important to consider the
development of the facts and whether any particular ADR mechanism is
appropriate at the
[[Page 36902]]
particular time to assist in a resolution of the case, or assist in the
development of the facts toward a faster and more efficient resolution.
Consideration should be given throughout the litigation to appropriate
ADR assistance.
1. FDA Referrals
a. FDA Civil Affirmative Litigation. In civil affirmative actions
under the Food Drug and Cosmetic Act (FDCA), the Government may pursue
seizure remedies (e.g. in in rem actions against adulterated or
misbranded food, drugs, or medical devices) and/or injunctive remedies
(e.g. in actions against manufacturers or distributors of misbranded or
adulterated food, drugs, or medical devices). Civil penalties and
consumer redress are unavailable under the FDCA. While OCL does not
seek monetary relief in FDA affirmative cases, ADR techniques may
nonetheless prove effective in obtaining expeditious settlements.
Because FDA seizure and injunction cases almost always involve
serious public health concerns, the client agency may be more receptive
to ADR techniques in which the Government takes an active role in
fashioning the settlement and retains the ability to accept or reject a
third party neutral's recommendations. Accordingly mediation (rather
than arbitration) is likely to be the ADR technique of choice. In
addition, the Government is likely to favor the utilization of third
party neutrals (whether U.S. Magistrates, retired Federal Judges, or
private mediators) who have an expertise in food and drug or public
health law.
Mediation may be particularly effective in the following
situations:
(1) Mediating claimants' manner of reconditioning or destruction of
adulterated or misbranded products in seizure actions.
(2) Mediating claimants' reimbursement of the Government's storage
and destruction costs in seizure actions.
(3) Mediating claimants' agreement to injunctive language in
consent decrees in actions initially filed as civil seizures. In
contested seizures, the Government may wish to expand its scope of
relief upon discovery of new facts or upon expenditure of considerable
resources. ADR is of particular use in these situations as the relief
sought extends beyond that prayed for in the Complaint. ADR should also
be considered in settling appeals of seizure actions (a settlement
which includes an injunction may prove more effective than an appellate
court's affirmance of a seizure that includes no prospective relief.)
(4) Mediating terms of injunctions, including reconditioning plans,
consumer notification obligations; and defendants; reimbursement of the
costs of FDA inspections conducted to ensure compliance with consent
decree terms.
b. FDA Civil Defensive Litigation. Most of OCL's defensive
litigation involves administrative and constitutional challenges to FDA
statutes and regulations (e.g. Administrative Procedure Act challenges
to the Nutrition Labeling and Education Act). Typically, both parties
in these cases seek a judicial resolution of the dispute which will
result in legal precedent. Nevertheless, ADR may be effective in
certain cases in which the agency may wish to avoid publicity, a
judicial decision is likely to be unfavorable, or the issue at stake
(e.g. whether the FDA has engaged in unreasonable delay in evaluating
an applicant's new drug application) is not of precedential importance
to the Government.
c. FDA Criminal Litigation. FDA criminal cases are inappropriate
for ADR consideration because a final judicial decision (whether
through a plea agreement or trial) is required.
2. FTC Referrals
OCL's affirmative FTC Rule violation and false advertising actions
include requests for monetary relief and are often most suitable for
ADR techniques. Mediation or early neutral evaluation provided by U.S.
Magistrates and/or Senior Judges is the ADR methodology currently
preferred by the client agency for the following reasons: (1) The FTC
recommends specific parameters to OCL regarding the acceptable range of
monetary relief for which it will settle (settlement ranges are
provided by the FTC's Bureau of Economics and are voted on by the FTC
Commissioners). Any type of binding arbitration may therefore be
inappropriate, as OCL must maintain an ability to reject a settlement
proposal suggested by a third party neutral that is out of the range
considered acceptable by the client agency. (2) Individual FTC Rule
violation cases are often part of larger enforcement initiatives. OCL
must therefore retain the ability to ensure that like cases are settled
for like amounts. (3) The FTC's economic statistics used to guide the
Government's settlement positions are confidential. The agency would be
reluctant to release those statistics to third party neutrals who are
not Judicial officers. However, other non-binding ADR techniques
utilizing third party neutrals should be considered.
Mediation may be particularly effective in the following
situations:
(1) Mediating the terms of a consent decree for FTC Rule violations
including modification of the defendant's consumer disclosure
practices.
(2) Mediating the amount of civil penalties recovered.
(3) Mediating the amount of consumer redress recovered and the
method for dispersing such funds among injured consumers.
3. CPSC Referrals
OCL's cases referred by the Consumer Product Safety Commission
include civil actions seeking civil penalties, consumer redress, and
injunctions. The criteria and concerns relating to civil CPSC matters
mirror those relating to FTC civil enforcement actions discussed above.
OCL also prosecutes a small number of criminal CPSC cases. These
criminal matters are not amendable to ADR techniques as a judicial
resolution is required.
4. NHTSA Referrals
OCL referrals from National Highway Transportation and Safety
Administration (and, to a lesser extent, State Highway Patrols and the
FBI) relate primarily to criminal odometer tampering prosecutions.
These criminal actions require judicial resolution and are not
amendable to ADR techniques.
D. Criteria for the Office of Immigration Litigation
In applying the below criteria, it is important to consider the
development of the facts and whether any particular ADR mechanism is
appropriate at the particular time to assist in a resolution of the
case, or assist in the development of the facts toward a faster and
more efficient resolution. Consideration should be given throughout the
litigation to appropriate ADR assistance.
1. Factors Counseling for ADR
a. Lawsuits challenging INS operations other than enforcement
measures controlled by statute or regulation may be amendable to ADR at
various stages. (The factors regarding other types of OIL litigation
identified in section 2 below, should also be considered in deciding
whether ADR is appropriate for these cases.) Mediation is most likely,
although other ADR methods such as early neutral evaluation may be
appropriate if they are likely to reduce the time and cost of
litigation in a specific case.
[[Page 36903]]
(1) Issue is localized or limited to a specific INS district or
facility.
(2) Agency (or district) has some flexibility in resolving matters.
(3) Need exists to narrow issues, dispute is largely factual, or
discovery needs to be tailored to material issues.
(4) Hostile forum (where more control of case and a fairer or more
effective and favorable outcome may be obtained through mediation).
(5) Court appears to be unwilling to rule
(6) Expectations of party/parties are unreasonable (parties or
aggrieved persons may benefit from an evaluation of their case by
someone other than their lawyers).
(7) Statute or regulation has been rescinded.
b. Attorney Fee Disputes.
(1) Sole issue or remaining issue in the case
(2) ADR will speed anticipated settlement and avoid needless
increase in attorney fees.
2. Factors Counseling Against ADR
a. Petitions for review of deportation orders in the courts of
appeal and petitions for habeas corpus for judicial review of exclusion
orders in the district court under 8 U.S.C. 1105a, or exercise of
enforcement authority and discretion delegated to INS district
directors or other officials:
(1) Statute provides the ``exclusive'' procedures for judicial
review.
(2) Prescribed outcomes or statutory remedies are inflexible.
--Grounds for exclusion and deportation are determined by statute
--Requirements for relief are determined by statute
(3) There has been prior extensive administrative process
--Review is limited to the administrative record, and facts of these
cases are rarely in dispute by the time case reaches federal court
--Actual challenge is to the agency's evaluation of facts, exercise of
discretion, or other elements entitled to deference by the courts
(4) Additional procedure would most benefit the alien who seeks to
delay his inevitable departure or to stall for the time he lacks to
minimally qualify for relief such as suspension of deportation and
212(c) waivers.
(5) Actual error can be corrected by motion to remand to BIA or
reconsideration by agency.
b. Litigation challenging implementation of the immigration laws,
including new legislative initiatives, Executive orders, government
policy, amended regulations, and enforcement actions under existing
authority, statutes and regulations:
(1) Judicial resolution or precedent is needed.
--case involves significant legal, policy, or constitutional issues
where there is little or no likelihood of flexibility in the
government's position
--case involves issue of first impression and is important to
development of a particular area of law
--favorable facts make the case a good vehicle to establish legal
ruling in development of law
--judicial resolution is unavoidable because statutory or regulatory
program is at stake
(2) Injunctive relief is sought and delay would cause prejudice.
(3) Agency is exercising its judicially recognized exclusive
authority over issues of immigration and needs to respond to changed
circumstances.
(4) Executive Branch must be able to fully preserve its ability to
respond to events that may implicate relations with other nations.
(5) Law enforcement function cannot be compromised.
--goal of opponent's suit is to undermine or minimize adverse
consequences prescribed by Congress
--challenge is to principles so fundamental that productive negotiation
is unrealistic
--nongovernmental party has an incentive to stall
(6) Issue needs uniform treatment.
--issue has nationwide impact
--similar suits pending or anticipated
--aliens' advocates are bringing similar actions in different courts in
search of a sympathetic forum
--no legitimate reason to settle with one party or plaintiff group
--need to maintain established policies or consistent results between
individual cases
--need to discourage similar suits
(7) Law is settled.
--no compromise or relief is available
--strong likelihood of success on the legal issues
--case is likely to be disposed of by summary judgment or other
dispositive motion
--case is frivolous, dispute is different from actual grievance (i.e.,
due process claim when alien is ineligible for relief), or only
discernible purpose is delay
(8) Case is likely to settle or settle faster through unassisted
negotiation without ADR
(9) Parties are not willing to negotiate or prepared to settle case
(10) Government official, officer or other individual is sued in
his personal capacity
(11) Parties are not represented by counsel
(12) Opponent is untrustworthy, his credibility is a disputed
issue, or United States has reason to believe that he is engaging in
fraudulent or criminal behavior
E. Criteria for the Federal Programs Branch
Among the Branch cases which appear most amenable to ADR are
personnel actions, particularly those involving factual disputes and
parties which have an ongoing work relationship. Less amenable as a
group are the constitutional and major APA challenges, since the cases
the Branch chooses to personally handle involve the most visible
government policies and programs which impact not just the parties
directly involved in the lawsuits but often have broad implications for
the whole of society. These are often the cases whose policy
determinations are considered the most important by the defendant
agencies and for which flexibility in terms of settlement options is
quite limited. Consideration of ADR may be appropriate, however, for
routine APA challenges where there is more flexibility in the agency,
substantial legal precedent already exists, and the use of a third-
party neutral may be beneficial to expedite the settlement process.
In applying the below criteria, it is important to consider the
development of the facts and whether any particular ADR mechanism is
appropriate at the particular time to assist in a resolution of the
case, or assist in the development of the facts toward a faster and
more efficient resolution. Consideration should be given throughout the
litigation to appropriate ADR assistance.
1. Factors Counseling for ADR
(a) Continuing relationships between plaintiffs and agency.
(b) Case involves largely a factual dispute.
(c) Relief sought is money damages.
(d) Agency is essentially a stakeholder, with plaintiffs or co-
defendants trying to impose on agency diametrically opposed relief or
requirements (this element may appear in some APA and other policy type
cases); similarly, where there are many parties to the lawsuit with
divergent interests which hamper standard negotiation efforts.
(e) Plaintiffs and agency are interested in seeking resolution but
personality conflicts or poor communication
[[Page 36904]]
between opposing counsel adversely affects settlement negotiations.
(f) There are underlying issues which are not formally part of the
complaint and which cannot be resolved by the relief legally available,
but which are the catalyst for the lawsuit.
(g) Apparent unwillingness of court to rule on matters which would
advance the case toward resolution.
(h) Where you expect to settle eventually, most likely on the
``courthouse steps.''
(i) Where plaintiffs' demands, or the agency's view of the case,
are unrealistic, and a realistic appraisal of the situation by a
neutral third party may help unlodge the recalcitrant party.
(j) Where there is a need to avoid adverse precedent but
traditional settlement negotiations have reached an impasse.
2. Factors Counseling Against ADR
(a) Case involves significant legal, policy, or constitutional
issues where there is little or no likelihood of flexibility in the
government's position.
(b) Where judicial resolution is necessary for precedential value.
(c) The case can likely be efficiently disposed of by summary
judgment or other dispositive motion.
(d) The case is likely to settle in near future without need for
neutral assistance.
F. Criteria for the Appellate Staff
The criteria listed below are suggested as a starting point for
analyzing whether a case on appeal could benefit from ADR. While each
attorney should also examine the criteria of the trial component from
which the appeal arose, other criteria come into play or take on a
different degree of importance at the appellate level. For instance,
the role of precedent at the court of appeals level is much greater.
Attorneys should consider what if any ADR efforts were attempted
earlier in the case, and whether and how the case has changed from its
posture at the trial level, both factually and legally. The ADR
techniques that are likely to be used by the Appellate Staff are
mediation and case evaluation, because at the appellate level the
issues are largely legal ones that would not benefit from the more
fact-intensive techniques such as mini-trials.
1. Factors Counseling for ADR
(a) Predominantly factual case where government faces clearly
erroneous standard.
(b) Monetary cases without significant precedential concerns.
(c) Risk of adverse precedent or publicity. E.g., case is poor
vehicle to establish favorable legal precedent, circuit has poor track
record on type of issue, risk of circuit split and Solicitor General
unlikely to authorize certiorari, loss on the issue may create poor
precedent for other government agencies.
(d) Need for swift resolution. E.g., agency has programmatic needs
that cannot await the usual length of the appellate process, the appeal
is only one part of multi-issue litigation with the potential for
future remands and appeals.
(e) Continuing relationships. E.g., ongoing federal/state
relationship, ongoing relationship between agency and regulated entity,
continued contact in implementation of remedy or class action.
(f) Numerous parties and issues.
(g) Need to avoid increased attorneys fees or post-judgment
interest that unsuccessful appeal will incur.
(h) Need for problem solving or development of creative
alternatives or flexibility in shaping relief e.g., suit is only one
facet of a deeper dispute involving other issues court may not be able
to address.
(i) Other parties are willing to consider ADR.
(j) Certain statutory, regulatory, or constitutional cases e.g., no
continuing importance because statutes or regulations have been
amended, constitutional challenge such as due process actually masks
some underlying issue capable of resolution such as plaintiff's desire
for expungement of record or consideration for job opening.
(k) Case is one which should have been settled in district court
but was not.
2. Factors Counseling Against ADR
(a) Need for judicial precedent. E.g., need to establish legal
ruling in development of a particular area of law and favorable facts
make case a good vehicle, judicial resolution unavoidable because
nothing short of validity of statutory/regulatory program is at stake.
(b) Need for uniform treatment. E.g., many similar suits pending
and no legitimate reason to settle with only one party.
(c) Need to discourage similar suits.
(d) Need for continuous monitoring of compliance by court or public
judicial decision in certain enforcement cases.
(e) Likelihood of success is great and relief sought is
significant.
III. Which ADR Techniques Are Appropriate for a Case
A. Mediation
1 There is a continuing relationship among the parties.
2 The disputed facts are not technical, requiring subject-matter
expertise.
3 There are multiple defendants, with the United States having the
greatest exposure.
4 Risk of unfavorable precedent.
5 In affirmative cases, there will be an unacceptable delay from
the time suit is filed until payment.
6 Either side can benefit from hearing directly from the client.
7 Opposition needs a realistic view of the case.
8 Flexibility in desired relief.
B. Early Neutral Case Evaluator/Expert
1 Know at the outset that case can be settled.
2 The parties disagree on the amount of damages.
3 Factual issues requiring expert testimony may be dispositive of
liability or damage issues and use of an expert neutral is cost
effective.
4 A resolution of the factual issue will assist in settlement.
5 Opposition needs a realistic view of the case.
C. Arbitration
1 The parties disagree on the amount of damages.
2 It is a District where the arbitrators are well-respected.
3 There are no complex factual issues involving several areas of
expertise and the parties disagree on the facts.
D. Mini Trials
1 In affirmative cases, there will be an unacceptable delay from
the time suit is filed until payment.
2 There are simple factual issues which do not necessarily require
expert testimony, but would take an excessive amount of time to present
in a traditional forum.
3 There are complex factual issues which are generally explained
with expert testimony.
4 The attorneys can equably summarize the facts to the fact-
finder, without the necessity of lengthy cross-examination.
IV. Criteria for the Selection of ADR Providers
In selecting an ADR provider for a case, Civil Division attorneys
should consider the non-exclusive factors set out below. When assessing
these factors, attorneys may also consider whether an ADR provider
meets the requirements of the relevant state or federal court rules for
neutrals. Attorneys may wish to interview the prospective neutral and
obtain their resumes in ADR experience
[[Page 36905]]
where appropriate. Attorneys may also wish to consult other attorneys
who have used the prospective neutral in other cases. In finding
prospective ADR providers, attorneys may consult the Senior Counsel for
Dispute Resolution, other attorneys in their office, division, or in
the Department for such providers.
1. Neutrality, and Related Ethics Standards--Is the ADR provider
unbiased, acting in good faith, diligent, and not seeking to advance
his or her own interest at the expense of the parties? Will the ADR
provider deal fairly with the parties, be reasonably available to the
parties, show no personal interest in the content of the settlement?
Does the neutral know counsel, and if so, what is the nature and
context of that knowledge? Is the neutral subject to disqualification
on grounds analogous to those found within 28 U.S.C. 455. Check Society
of Professional for Dispute Resolution's Ethical Standards.
2. Training--What kind and extent of training for the particular
ADR process has the neutral received? Has the neutral been trained by a
well-recognized program?
3. Experience--
(a) ADR Experience: number of cases in which the neutral has
employed the particular dispute resolution process or related
processes, dollar amount in controversy, diversity of processes,
complexity of the issues, years of experience in a particular
process(es), breadth of experience in types of disputes, experience in
multi-party and/or multi-issue disputes, affiliation with court-annexed
programs.
(b) Litigation Experience: Is the neutral an attorney? Type of
legal practice, years of experience, complexity of cases and issues,
experience in government litigation.
4. Subject-Matter Expertise In The Type of Dispute and/or Issues--
Factors Favoring Subject-Matter Expertise:
(a) Highly technical areas of law are central for understanding the
dispute and/or issues and the fashioning of the options for resolution
of the dispute (e.g. patent, subspecialities of science or medicine).
(b) Issue is one of damages--when offers are far apart, expertise
in typical damage awards and in standard components of damage
calculation may bring parties; offers closer (e.g. certain attorney
fees, personal injury disputes).
(c) When the parties and attorneys are hesitant to use ADR for a
particular case, and expertise will build credibility for them.
(d) There is an impasse over discrete factual and/or legal issues.
(e) Expertise is central to a particular Kind of ADR process--e.g.
case evaluation on factual issues, mini-trial, arbitration.
V. Training
Each Civil Division attorney will be trained in a basic, but
comprehensive, 6-hour ADR course. The course will be skills-based and
interactive. Classes should be comprised of 30-35 attorneys from a
variety of Civil Division components. The small class size will permit
an interactive focus and discussion format, while the class composition
will facilitate a cross-pollination of experiences and ideas among the
components. As many of the instructors as possible will be Civil
Division litigators with substantial ADR experience. The agenda for the
basic ADR training course is envisioned as follows:
A. ADR TECHNIQUES, CASE SELECTION CRITERIA, SELECTION OF PARTICULAR
ADR PROCESS (lecture/discussion 1\1/2\ hours).
B. CONCRETE EXAMPLES BY GOVERNMENT LITIGATORS OF ADR AND HOW IT
WORKS (lecture/discussion 30 minutes).
C. NEGOTIATION SKILLS (lecture 1 hour).
D. INTERNAL PROCEDURES, AUTHORIZATION & FUNDING OF NEUTRALS,
SELECTION OF NEUTRALS (lecture 30 minutes). This section will include
guidance on how to find an appropriate neutral and how to assess
whether the prospective neutral will be a good fit for the case.
E. ATTORNEY PREPARATION FOR ADR (lecture 30 minutes)--includes
discussion of case and client agency preparation for ADR, and pre-
settlement & settlement authorization.
F. ADR ROLE-PLAYS (2 to 2\1/2\ hours)--class may be divided into
smaller groups. Each member of the small groups will have the
opportunity to participate in the role-play. Instructors and
participants will have the opportunity to critique and give feedback
both during and after the role-plays. The fact patterns for the role-
plays will be chosen to reflect the Civil Division's diverse litigation
responsibilities, for example, torts, contract, EEO, and an APA
challenge. Every effort will be made to match the participant with a
role-play relevant to their litigation caseload.
At the conclusion of the course, participants will be asked to
complete and evaluation form. On the basis of those evaluations,
comments from the instructors and our actual experiences with ADR, the
Civil Division will continue to modify and refine the basic course. All
new Civil Division attorneys will also be required to take the course.
Once experience with the basic ADR training occurs, the Civil Division
will be able to develop supplemental ADR training as needed. This
training will be coordinated with the Office of the Senior Counsel for
ADR.
VI. Procedures for Authorization and Funding of Neutrals
These procedures supplement the instructions issued by the Office
of Senior Counsel for Alternative Dispute Resolution (SCADR) in the
Associate Attorney General's Office. Civil Division attorneys shall
request authorization and funding for neutrals in accordance with these
procedures. Prior to using these procedures you should make
arrangements with the opposing party and third party neutral and
execute a proposed ADR agreement (available from your ADR
representative).
The revised Form OBD-47, Request for Authorization, and Agreement
for Fees and Expenses for Witnesses and Alternative Dispute Resolution
Neutrals will be used. This document will serve as the formal contract
with the third party neutral.
STEP 1--It is impractical to obtain full and open competition for
ADR in most cases. However, before the OBD-47 is completed, the case
attorney must negotiate the best neutral rate possible.
STEP 2--Once the OBD-47 has been completed and approved by the
branch director, forward the OBD-47, the ADR agreement, and any
additional supporting documentation to Raziya Clouser of the Contracts
and Procurement Branch (Room 7110, Todd Building) for processing.
Contracts and Procurement Branch will obtain a commitment of funds from
SCADR for each request; a neutral should not begin work in advance of a
fully approved request.
STEP 3--After the Contracts and Procurement Branch has returned the
approved agreement, the case attorney should sign it, obtain the
neutral's signature, and return a copy of the fully executed agreement
back to the Branch. It is not necessary for the case attorney to
forward a copy of the signed agreement to the SCADR; the Contract and
Procurement Branch will perform this task.
STEP 4--The neutral should forward all invoices to the case
attorney for review and certification. Because of Prompt Payment Act
requirements, it is critical that invoices are date stamped when they
are received by the attorney. It is also vital that the case attorney
review the invoice and (1) reject it, if it is defective, or (2)
certify it for payment,
[[Page 36906]]
if it is proper, within seven days of the invoice's receipt (refer to
the Civil Division directive on expert witnesses, CIV 2110A, Sec. d.
Payment of the Expert Witness for more detailed invoice rejection and
certification instructions).
STEP 5--Once a neutral's invoice has been certified for payment, it
should be forwarded along with a copy of the signed OBD-47 to Frank
Free of the Office of Planning, Budget, and Evaluation (Room 7032, Todd
Building) for payment.
Questions regarding the procurement of third party neutrals should
be directed to Ms. Clouser at 606-0786. Questions regarding payment
should be directed to Mr. Free at 307-0842.
VII. Coordination, Reporting, and Evaluation
The Civil Division ADR committee shall coordinate ADR activities on
behalf of the Division. The committee consists of Stephen Altman
(Chair), Deborah Kant (Vice Chair), Susan Cavanagh, Mary Doyle, Vince
Faggioli, Debra Kossow, Cindy Lebow, Emily Radford, Deborah Smolover,
and Sandy Schraibman and Kim Humphries.
A system of reporting on cases in ADR shall be established. A
reporting form of one page shall be filled out when an ADR process is
considered or used, and the data shall be included in the computerized
data bank maintained by the Civil Division's Management Programs
component.
In addition, a system of evaluation will be instituted that allows
for civil division attorneys using ADR providers to give immediate
feedback to a centralized data base. Attorneys using ADR providers'
services will be asked to rate the provider on the general standards
set out above in the selection of neutrals section. These evaluation
forms should then be made available to any potential future users of an
ADR provider's services. When any providers consistently receive poor
evaluations, this information will be included in the data bank and
made available to civil division attorneys.
VIII. Miscellaneous
The Civil Division's Statement On ADR relates to the government's
voluntary participation in ADR. Nothing herein shall be construed to
limit the government's duty to participate in ADR pursuant to court or
applicable local rules, except that Civil Division attorneys shall
resist participation in ADR, by appropriate motion, whenever said
participation would violate the United States Constitution or other
governing law.
This Statement shall not be construed as creating any right or
benefit, substantive or procedural, enforceable at law or in equity, by
a party against the United States, its agencies, its officers, or any
other person. This Statement shall not be construed to create any right
to judicial review involving the compliance or noncompliance of a Civil
Division attorney with its terms.
Appendix
``Alternative Dispute Resolution'' (``ADR'') means any
procedure, involving a ``neutral,'' that is used in lieu of trial to
resolve one or more issues in controversy, and includes but is not
limited to the following ``ADR techniques'';
1. Mediation means a flexible, nonbinding process in which a
neutral third party, the mediator, facilitates negotiations among
the parties to help them reach a settlement. In doing so, the
mediator may expand traditional settlement discussion and broaden
resolution options, often by going beyond the legal issues in
controversy or incorporating nonparties in discussions.
Theoretically, the mediator does not provide an opinion as to how
the case should be resolved, but merely helps the parties settle the
case among themselves.
2. Early neutral case evaluation, unlike mediation, on liability
and/or damages. The evaluator usually has subject-matter expertise.
The opinion is non-binding and generally occurs early in the
lawsuit. The parties may have the option of asking the evaluator to
continue to mediate the dispute.
3. Neutral expert evaluation is similar to early neutral case
evaluation; however, the evaluation does not necessarily occur early
in the litigation. The expert is chose based on the expertise needed
to resolve some factual dispute in the case. The export provides a
non-binding opinion.
4. Arbitration usually consists of a panel of one or more
arbitrators who listen to the parties present their respective views
of the case in an expedited, adversarial hearing format. The
formality varies and may involve presentation of documents and
witnesses or simply a summary by counsel. A decision is rendered
that addresses liability and damages, if necessary. As of this time,
it is non-binding on the United States and either party may request
a trial de novo.
5. Minitrial means a flexible, nonbinding hearing, generally
reserved for complex cases, in which counsel for each party
informally presents a shortened form of its case to settlement-
authorized representatives of the parties in the presence of a
presiding judge, magistrate judge, or other neutral, at the
conclusion of which the representatives meet, with or without the
judge or neutral, to negotiate a settlement, failing which the case
proceeds to trial.
6. Summary bench trial means, in any case not triable by a jury,
a pretrial procedure intended to facilitate settlement consisting of
a summarized presentation of a case to a Judicial Officer whose
decision and subsequent factual and legal analysis serves as an aid
to settlement negotiations.
7. Summary jury trial means a flexible nonbinding procedure,
usually reserved for trial-ready cases in which protracted jury
trials are anticipated, and involving a short hearing in which
evidence is presented by counsel in summary form, following which a
jury returns an advisory verdict that forms the basis for settlement
negotiations.
Civil Rights Division, Alternative Dispute Resolution, Case Screening
Factors
Alternative Dispute Resolution (``ADR''), as used here, is any
dispute resolution process facilitated by a third-party neutral. The
Civil Rights Division resolves consensually many of its civil cases
through traditional two-party negotiation and will continue to do
so. ADR is not meant to replace traditional negotiation, but rather
to provide attorneys with additional tools that may facilitate
communication and resolution of matters where party-to-party
negotiations have been or are likely to be unsuccessful.
In evaluating whether an ADR process may be useful, there are no
hard and fast rules. Attorneys should consider whether ADR might be
helpful in a particular case at the beginning of the litigation and
revisit the question throughout the progress of the case taking into
account the ADR processes that may be available through or imposed
by the court in a particular district or circuit as well as the
private ADR providers available in the relevant market. The
following is a brief description of the major ADR processes.
1. Mediation. An impartial third party facilitates confidential
discussions or negotiations among the parties to help them reach
settlement. Mediation is a creative, flexible process that may
broaden resolution options, often by going beyond the legal issues
in controversy.
2. Neutral Evaluation. Neutral evaluation is a confidential
conference where the parties and their counsel present the factual
and legal bases of their case and receive a non-binding assessment
by an experienced neutral with subject-matter expertise and/or with
significant trial experience in the jurisdiction. This assessment
can form the basis for settlement discussions facilitated by the
evaluator if the parties so choose.
3. Joint Fact-Finding. This term encompasses various processes
in which facts relevant to a controversy are examined and determined
by a neutral third party. Typically, the parties appoint a neutral
expert to resolve complex factual, technical, scientific, or legal
questions and agree in advance whether the findings will be treated
as advisory or binding.
4. Mini-Trial/Summary Jury Trial. An informal hearing-like
presentation by the parties of their best case in shortened form to
settlement-authorized representatives. Following the hearing, the
parties and representatives meet, with or without a neutral advisor,
to negotiate a settlement. If a jury is used, the jury's non-binding
verdict is used as a basis for subsequent settlement negotiations.
5. Arbitration. One or more arbitrators issue a judgment on the
merits (binding or non-binding) after an expedited adversarial
hearing.
The following is a non-exclusive list of factors to assist
attorneys in determining whether to use ADR in a particular case.
Not
[[Page 36907]]
all factors listed will be relevant to a given case, and factors not
listed below may weigh in favor of or against use of ADR in a
particular instance.
Factors Favoring Use of ADR
The Parties
<bullet> Continuing Relationships. The United States, aggrieved
persons, or other litigants are likely to have continued contact
with the defendants in implementation of remedy or in other
contexts.
<bullet> Barriers to Communication. The United States or other
litigants foresee impasses developing because of conflicts within
interest groups, political visibility, or poor or non-existent
communication among the participants (including attorneys) due to
personality difficulties or past history.
<bullet> Absent Stakeholder(s). Participation of persons or
groups who are not directly involved in the legal action may be
beneficial or necessary to optimal resolution.
<bullet> Divergence of Interests. There are gains and losses to
be apportioned constructively, and in which varying priorities among
the parties will allow trading off of those gains and losses to
permit all involved to benefit from the outcome.
<bullet> Numerous Parties. The number of parties or interested
persons or groups is so numerous that a structured/facilitated
negotiation process would be helpful.
<bullet> Litigation Against Other Government Agencies.
Involvement of a third-party neutral may assist in sorting through
and/or evaluating ``public interest'' claims of various governmental
components (among federal agencies or between federal and state or
local entities), provided non-Departmental litigants are acting in
good faith.
Nature of the Case
<bullet> Need for Problem Solving or Development of Creative
Alternatives. A thorough exchange of information and generation of
alternatives and options will improve the outcome.
<bullet> Factual or Technical Complexity or Uncertainty. The
parties would benefit from reliance on the expertise of a third-
party expert for technical assistance and/or fact-finding.
<bullet> Need for Facilitated Private Discussions. The
settlement desired may be improved by the neutral's ability to
conduct frank, private discussions among the parties.
<bullet> Flexibility Desired in Shaping Relief. The United
States is seeking relief with detailed implementation and/or
monitoring on multiple issues or subjects that may be difficult to
obtain from the Court, or is amenable to resolution through
cooperation between the parties.
<bullet> Ultimate Outcome Uncertain. Litigants face uncertain
outcome at the time of trial based on the law, the facts, or the
decisionmaker. Also important is the likelihood of prevailing on
appeal should the United States lose at trial.
<bullet> Hostile Decisionmaker. Case will be tried in front of
an unsympathetic Judge, or jury venue is likely to be unsympathetic
or even hostile.
<bullet> Conservation of Enforcement Resources. Preparing the
case for trial would require a burdensome commitment of significant
resources without achieving a proportionate impact.
<bullet> Numerous Issues. Discussion of multiple issues will be
assisted by a structured/facilitated negotiation process.
<bullet> Direct Settlement Negotiations Unsuccessful. The United
States has attempted traditional settlement negotiations without
success or an impasse has been reached and the United States
believes involvement of a third-party neutral will facilitate
further progress and/or final resolution.
Representation
<bullet> Need To Speak Directly to Client. The parties (or
aggrieved persons) need to hear an evaluation of the case from
someone other than their lawyers.
(For example, a case that appears to be headed for trial merely
because a defendant does not understand the applicable law.)
<bullet> Lawyers Are Willing To Consider ADR. The lawyers
involved are knowledgeable about ADR processes and intend to
participate in the chosen ADR process in a good-faith attempt to
resolve the dispute.
Timing
<bullet> Facts Are Sufficiently Developed. The parties have
sufficient information to permit them to make informed decisions
concerning the ultimate disposition of the dispute.
<bullet> Parties Are Prepared To Discuss Settlement. The parties
are willing to resolve the case short of trial.
Factors Disfavoring Use of ADR
<bullet> Public Sanction Necessary. There is a need for public
sanctioning of conduct.
<bullet> Imbalance of Power or Ability. A party or parties are
not able to negotiate effectively themselves or with assistance of
counsel.
<bullet> Judicial Decision Required. Development of the law is
important or the imprimatur of a court decision is necessary to
secure vindication of rights, enforcement, or compliance.
<bullet> Biased Selection Process for ADR Neutral. Political
sensitivity of case coupled with questionable neutral selection
process would likely result in selection of ``neutral'' with ties to
local political powers or parochial interests contrary to the United
States. (This situation may be dealt with by insisting that the
United States have power to overturn final selection of neutral.)
<bullet> Successful Summary Judgment Certain To Resolve Case
Conclusively.
<bullet> Case Very Likely To Settle Through Unassisted
Negotiation in Near Future.
Civil Rights Division, Alternative Dispute Resolution, Case Screening
Factors
Alternative Dispute Resolution (``ADR''), as used here, is any
dispute resolution process facilitated by a third-party neutral. The
Civil Rights Division resolves consensually many of its civil cases
through traditional two-party negotiation and will continue to do
so. ADR is not meant to replace traditional negotiation, but rather
to provide attorneys with additional tools that may facilitate
communication and resolution of matters where party-to-party
negotiations have been or are likely to be unsuccessful.
In evaluating whether an ADR process may be useful, there are no
hard and fast rules. Attorneys should consider whether ADR might be
helpful in a particular case at the beginning of the litigation and
revisit the question throughout the progress of the case taking into
account the ADR processes that may be available through or imposed
by the court in a particular district or circuit as well as the
private ADR providers available in the relevant market. The
following is a brief description of the major ADR processes.
1. Mediation. An impartial third party facilitates confidential
discussions or negotiations among the parties to help them reach
settlement. Mediation is a creative, flexible process that may
broaden resolution options, often by going beyond the legal issues
in controversy.
2. Neutral Evaluation. Neutral evaluation is a confidential
conference where the parties and their counsel present the factual
and legal bases of their case and receive a non-binding assessment
by an experienced neutral with subject-matter expertise and/or with
significant trial experience in the jurisdiction. This assessment
can form the basis for settlement discussions facilitated by the
evaluator if the parties so choose.
3. Joint Fact-Finding. This term encompasses various processes
in which facts relevant to a controversy are examined and determined
by a neutral third party. Typically, the parties appoint a neutral
expert to resolve complex factual, technical, scientific, or legal
questions and agree in advance whether the findings will be treated
as advisory or binding.
4. Mini-Trial/Summary Jury Trial. An informal hearing-like
presentation by the parties of their best case in shortened form to
settlement-authorized representatives. Following the hearing, the
parties and representatives meet, with or without a neutral advisor,
to negotiate a settlement. If a jury is used, the jury's non-binding
verdict is used a basis for subsequent settlement negotiations.
5. Arbitration. One or more arbitrators issue a judgment on the
merits (binding or non-binding) after an expedited adversarial
hearing.
The following is a non-exclusive list of factors to assist
attorneys in determining whether to use ADR in a particular case.
Not all factors listed will be relevant to a given case, and factors
not listed below may weigh in favor of or against use of ADR in a
particular instance.
Factors Favoring Use of ADR
The Parties
<bullet> Continuing Relationships. The United States, aggrieved
persons, or other litigants are likely to have continued contact
with the defendants in implementation of remedy or in other
contexts.
<bullet> Barriers to Communication. The United States or other
litigants foresee impasses developing because of conflicts within
interest groups, political visibility, or poor or non-existent
communication among the participants (including attorneys) due to
personality difficulties or past history.
<bullet> Absent Stakeholder(s). Participation of persons or
groups who are not directly
[[Page 36908]]
involved in the legal action may be beneficial or necessary to a
optimal resolution.
<bullet> Divergence of Interests. There are gains and losses to
be apportioned constructively, and in which varying priorities among
the parties will allow trading off of those gains and losses to
permit all involved to benefit from the outcome.
<bullet> Numerous Parties. The number of parties of interested
persons or groups is so numerous that a structured/facilitated
negotiation process would be helpful.
<bullet> Litigation Against Other Government Agencies.
Involvement of third-party neutral may assist in sorting through
and/or evaluating ``public interest'' claims of various governmental
components (among federal agencies or between federal and state or
local entities), provided non-Departmental litigants are acting in
good faith.
Nature of the Case
<bullet> Need for Problem Solving or Development of Creative
Alternatives. A thorough exchange of information and generation of
alternatives and options will improve the outcome.
<bullet> Factual or Technical Complexity or Uncertainty. The
parties would benefit from reliance on the expertise of a third-
party expert for technical assistance and/or fact-finding.
<bullet> Need for Facilitated Private Discussions. The
settlement desired may be improved by the neutral's ability to
conduct frank, private discussions among the parties.
<bullet> Flexibility Desired in Shaping Relief. The United
States is seeking relief with detailed implementation and/or
monitoring on multiple issues or subjects that may be difficult to
obtain from the Court, or is amenable to resolution through
cooperation between the parties.
<bullet> Ultimate Outcome Uncertain. Litigants face uncertain
outcome at the time of trial based on the law, the facts, or the
decisionmaker. Also important is the likelihood of prevailing on
appeal should the United States lose at trial.
<bullet> Hostile Decisionmaker. Case will be tried in front of
an unsympathetic Judge, or jury venire is likely to be unsympathetic
or even hostile.
<bullet> Conservation of Enforcement Resources. Preparing the
case for trial would require a burdensome commitment of significant
resources without achieving a proportionate impact.
<bullet> Numerous Issues. Discussion of multiple issues will be
assisted by a structured/facilitated negotiation process.
<bullet> Direct Settlement Negotiations Unsuccessful. The United
States has attempted traditional settlement negotiations without
success or an impasse has been reached and the United States
believes involvement of a third-party neutral will facilitate
further progress and/or final resolution.
Representation
<bullet> Need To Speak Directly to Client. The parties (or
aggrieved persons) need to hear an evaluation of the case from
someone other than their lawyers.
(For example, a case that appears to be headed for trial merely
because a defendant does not understand the applicable law.)
<bullet> Lawyers Are Willing To Consider ADR. The lawyers
involved are knowledgeable about ADR processes and intend to
participate in the chosen ADR process in a good-faith attempt to
resolve the dispute.
Timing
<bullet> Facts Are Sufficiently Developed. The parties have
sufficient information to permit them to make informed decisions
concerning the ultimate disposition of the dispute.
<bullet> Parties Are Prepared To Discuss Settlement. The parties
are willing to resolve the case short of trial.
Factors Disfavoring Use of ADR
<bullet> Public Sanction Necessary. There is a need for public
sanctioning of conduct.
<bullet> Imbalance of Power or Ability. A party or parties are
not able to negotiate effectively themselves or with assistance of
counsel.
<bullet> Judicial Decision Required. Development of the law is
important or the imprimatur of a court decision is necessary to
secure vindication of rights, enforcement, or compliance.
<bullet> Biased Selection Process for ADR Neutral. Political
sensitivity of case coupled with questionable neutral selection
process would likely result in selection of ``neutral'' with ties to
local political powers or parochial interests contrary to the United
States. (This situation may be dealt with by insisting that the
United States have power to overturn final selection of neutral.)
<bullet> Successful Summary Judgment Certain To Resolve Case
Conclusively.
<bullet> Case Very Likely To Settle Through Unassisted
Negotiation in Near Future.
September 11, 1995.
ADR Criteria--Environment and Natural Resources Division
The Environment and Natural Resources Division (``ENRD'')
proposes the following ADR criteria for use by its attorneys.
ENRD has made substantial progress in developing an ADR docket.
Approximately 18 months ago, we began to require each section
regularly to review its docket for potential ADR cases and to make
reports to the Assistant Attorney General. In this time, the
sections have identified approximately 200 cases as candidates for
resolution through ADR; of those matters, approximately 150 cases
are now in an ADR process or have been resolved through ADR or
otherwise.
We have several ideas for building on these initial successes.
Principally, we seek to encourage the use of ADR in new types of
cases and to increase the number of attorneys who are actively
involved in ADR and who have ADR expertise. For our purposes, the
ADR criteria should be inclusive, rather than exclusive, and should
encourage attorneys to be creative in the use of ADR. The criteria
are not intended to be utilized as a ``checklist'' of factors that
must be present for an ADR process; rather, they are offered as some
reasons among many others to use ADR. Further Division experience
with ADR processes will likely allow refinement of these criteria.
We therefore propose that ENRD attorneys should use a single
criterion and several factors in evaluating the use of ADR:
ADR Criterion: ENRD attorneys should consider and use ADR
techniques in their cases whenever ADR may be an effective way to
reach a consensual result that is beneficial to the United States.
ADR Factors: In its use of ADR thus far, ENRD has found that ADR
can be helpful in achieving a beneficial settlement in various
situations, some of which are identified below. ENRD attorneys
should look to these factors as some reasons why ADR might be useful
in their cases. Even cases that do not exhibit these factors are
often appropriate for ADR.
One of the advantages of ADR is that it gives the parties to a
dispute the flexibility to fashion their own procedures for
resolving the dispute. There are almost as many kinds of ADR as
there are parties and disputes. Thus, in evaluating whether ADR
processes may be useful, there are no hard and fast rules. Attorneys
should begin considering whether ADR might be helpful in a
particular case at the beginning of the litigation and should
continue to revisit the question throughout the progress of the
case. Such analysis must take account of the ADR processes that may
be available through or imposed by the court in a particular
district court or circuit. Attorneys should keep in mind that many
different kinds of ADR are available both through the courts and
independent of the courts.
As ENRD gains more experience with ADR. we intend to amend and
add to these factors:
--Ability of neutral to conduct frank, private discussions may
improve the outcome.
--Range of issues are broad enough, or can be creatively made broad
enough, to allow tradeoffs and creative generation of options
presented, especially when some options cannot be ordered by a
court. For example, in a NEPA dispute, underlying resource
management decisions are likely the crux of concern, but cannot be
reached by a court. Addressing concerns with respect to the
underlying dispute can resolve the issue at hand, and may forestall
future litigation. Money disputes can often be more complex than
they first appear.
--A neutral may be helpful in facilitating negotiations by breaking
through impasses that develop because of :
--Conflicts within interest groups;
--Technical complexity or uncertainty;
--Political visibility;
--Poor communication among the participants due to personalities or
past history.
For example, a neutral can defuse tension with a citizens' group
angry about a particular agency project by presenting negotiating
proposals from all sides in an even-handed manner. If appropriate, a
neutral or other joint expert might offer technical expertise on a
given issue.
--Thorough exchange of information will improve the outcome. For
example, a neutral can help to ensure that all issues are addressed,
and that the heat of negotiating has not caused the parties to
overlook an item that may be crucial to settlement implementation.
[[Page 36909]]
--Participation of parties not directly involved in a legal action
is necessary or beneficial to the settlement. For example, numerous
citizens' groups may be interested in a particular agency project;
addressing the concerns only of the group that sued may be short-
sighted, and invite future litigation from others.
--Number of parties and issues numerous, such that a facilitated,
structured settlement process would be helpful, and no party is
willing or able to take on his role. For example, CERCLA allocation
disputes often involve multiple parties and issues, and a neutral
who provides a structure for allocation can assist the parties in
reaching a global settlement.
* * * * *
This document relates to the United States' voluntary
participation in ADR. Nothing here shall be construed to limit the
United States' duty to participate in ADR pursuant to court order or
applicable local rules, except that Division attorneys shall resist
participation in ADR, by appropriate motion, whenever such
participation would violate the United States Constitution or other
governing law.
This document shall not be construed to create any right or
benefit, substantive or procedural, enforceable at law or in equity,
by a party against the United States, its agencies, its officers, or
any other person. This document shall not be construed to create any
right to judicial review involving the compliance or noncompliance
of a Division attorney with its terms.
Executive Office for United States Attorneys' Policy Statement and
Practice and Procedure Guide on the Use of Alternative Dispute
Resolution
This Policy Statement and Practice and Procedure Guide
(``Guide'') is distributed to all United States Attorneys (USAs)
nationwide pursuant to paragraph 7 of Department of Justice Order
OBD 1160.1, dated April 6, 1995, and entitled, ``Promoting the
Broader Appropriate Use of Alternative Dispute Resolution
Techniques.'' This Guide should be distributed immediately to all
Assistant United States Attorneys (AUSAs) and Special Assistant
United States Attorneys (SAUSAs) handling civil litigation in state
or federal courts.
I. Introduction
The purpose of this Policy Statement and Practice and Procedure
Guide is to encourage the use of Alternative Dispute Resolution
(ADR) and to foster and develop alternatives to the traditional
adversarial techniques used to resolve civil legal disputes
involving the United States. Pursuant to the Department of Justice
Order OBD 1160.1, the civil litigating components of the Department
of Justice (DOJ) are expected to use ADR techniques in appropriate
civil cases in an effort to resolve or avoid litigation. The USAs
have the opportunity to take the lead in formulating and
implementing ADR methods in order to promote less time consuming,
more effective resolution of civil litigation.
The April 6, 1995 Order, requires each component of the
Department of Justice, including the Executive Office for United
States Attorneys (EOUSA) to:
(1) issue a policy statement concerning and promoting the use of
ADR and to cooperate with court-annexed or court-sponsored ADR
programs;
(2) create a set of criteria to be used in identifying specific
cases appropriate for resolution through settlement negotiations or
formal ADR techniques, identifying the most suitable methods of ADR
for specific case categories and developing a criteria for selection
of independent neutrals;
(3) implement a component-wide comprehensive basic training
program in negotiation and ADR that shall be mandatory for all
attorneys handling civil matters with periodic supplemental
training;
(4) issue a complete explanation of the internal procedures
attorneys should follow in obtaining authorization and funding for
the use of formal ADR techniques;
(5) designate person(s) within the component who shall have
primary responsibility for coordinating the component's ADR efforts
so that a network of individuals with ADR expertise is established,
and
(6) collect and maintain statistics regarding component use of
ADR and report these statistics annually to the Associate Attorney
General.
All attorneys within the litigating components of the DOJ,
including AUSAs, who handle civil litigation, are urged to consider
the appropriate use of ADR in each matter handled. Alternative
Dispute Resolution should be used in conjunction and association
with traditional settlement processes found within the litigation
process.
Civil AUSAs will be responsible for reviewing their respective
cases and matters to determine whether ADR is appropriate and what
ADR process is most suitable for each case or matter in accordance
with each district's approval procedures. Assistant United States
Attorneys with primary case responsibility, with approval and
oversight of the district's ADR Officer, will be responsible for
analyzing the matter or case in light of the following guidelines.
It is important to the concept of Access to Justice that the
courts provide for swift resolution of conflict for civil litigants.
As the courts continue to be saturated with criminal matters and
significant civil litigation, appropriate ADR will serve to reserve
judicial time and court expense to the truly intractable issue.
II. General Civil Litigation Policy Statement
A. Settlement Objectives. The goal of USAs as participants in
ADR and during other settlement discussions shall be as follows: In
consultation with the client, to weigh the magnitude and likelihood
of all costs, risks, and benefits associated with nonsettlement
versus participation in ADR and to consider the best interests of
the client and the government, and--through voluntary settlement
and/or ADR, if possible and cost-efficient--to achieve the most
favorable result reasonably obtainable under the circumstances on
behalf of the client, consistent with applicable law and the highest
standards of fairness, justice and equity.
B. Although the interest of the government in participating in
ADR is compelling, this Guide is intended neither to compel ADR nor
any ADR technique in any particular case or category of cases, nor
is it to compel pretrail settlement. Nothing in this Guide shall be
construed to obligate the United States to offer funds to settle any
case, to accept a particular settlement or resolution of a dispute,
to alter its standards for accepting settlements, or to alter any
existing delegation of settlement or litigating authority.
C. This Guide relates to the government's voluntary
participation in ADR. Nothing herein shall be construed to limit the
government's duty to participate in ADR pursuant to court order or
applicable local rules, except that USAs shall resist participation
in ADR, by appropriate motion, whenever said participation would
violate the United States Constitution or other governing law.
D. The USAs are encouraged to recognize contributions made by
AUSAs who handle matters in ADR by providing the same opportunities
for promotion, awards and other professional recognition as those
engaged in more traditional litigation.
E. This Guide shall not be construed as creating any right or
benefit, substantive or procedural, enforceable at law or in equity,
by a party against the United States, its agencies, its officers, or
any other person. This Guide shall not be construed to create any
right to judicial review involving the compliance or noncompliance
of the USAs with its terms.
III. Purposes
The purposes of this Guide include the following:
A. To designate various categories of cases as generally
``appropriate for ADR'' according to cause of action and nature of
disputed issues.
B. To designate various other categories of cases as generally
``inappropriate for ADR.''
C. With respect to those categories of cases designated as
``appropriate for ADR,'' to suggest preferred ADR techniques,
without limiting the discretion of the USA to employ other ADR
techniques.
D. To identify, by way of example but not limitation, various
circumstances under which the USA might wish to participate in ADR,
notwithstanding that the particular case may fall outside a category
designated as ``appropriate for ADR'' or may be designated as
generally ``inappropriate for ADR.''
E. Generally to promote the broader appropriate use of ADR
techniques by United States Attorneys through enhanced awareness,
training, and recordkeeping, among other things.
IV. Definitions
The following definitions shall apply throughout this Guide \1\
---------------------------------------------------------------------------
\1\ Most of the definitions set forth herein have been
excerpted, with minor adaptions, from National ADR Institute for
Federal Judges, Judge's Deskbook on Court ADR (Harvard Law School,
November 12-13, 1993).
---------------------------------------------------------------------------
A. ``Alternative Dispute Resolution'' (``ADR'') means any
procedure, involving a ``neutral,'' that is used in lieu of trail to
[[Page 36910]]
resolve one or more issues in controversy, and includes, but is not
limited to the following ``ADR techniques'':
1. ``Arbitration'' means a flexible adjudicatory dispute
resolution process in which one or more arbitrators issue a
nonbinding judgment on the merits after an expedited, adversarial
hearing. The nonbinding decision of the arbitrator(s) addresses only
the disputed legal issues and applies legal standards. Either party
may reject the nonbinding ruling and request a trial de novo.
2. ``Early neutral evaluation'' means bringing all parties and
their counsel together early in the pretrial phase of litigation to
present summaries of their cases and receive a nonbinding assessment
by an experienced, neutral evaluator with subject-matter expertise,
usually an attorney, who may also provide case planning guidance
and, if requested by the parties, settlement assistance.
3. A ``judicial settlement conference'' means a settlement
conference before a judge or magistrate judge, who, upon hearing
summaries of each party's case and applicable law, may articulate
opinions about the merits of the case or otherwise facilitate the
trading of settlement offers by mediatory or other techniques aimed
at improving communication among the parties and eliminating
barriers to settlement. Because the judicial settlement conference
constitutes a more traditional litigation mechanism, judicial
settlement conferences will not be reported as an ADR mechanism for
statistical purposes.
4. ``Mediation'' means a flexible, nonbinding process in which a
neutral third party, the mediator, facilitates negotiations among
the parties to help them reach a settlement. In doing so, the
mediator may expand traditional settlement discussion and broaden
resolution options, often by going beyond the legal issues in
controversy or incorporating nonparties in discussions.
5. ``Minitrial'' means a flexible, nonbinding hearing, generally
reserved for complex cases, in which counsel for each party
informally presents a shortened form of its case to settlement-
authorized representatives of the parties in the presence of a
presiding judge, magistrate judge, or other neutral, at the
conclusion of which the representatives meet, with or without the
judge or neutral, to negotiate a settlement. If settlement is not
reached, the case then proceeds to trial.
6. ``Neutral expert evaluation'' means bringing all parties and
their counsel together to present summaries of their cases to an
experienced, neutral expert for the purpose of receiving a
nonbinding assessment or otherwise resolving a ``swearing contest''
among competing experts.
7. ``Summary bench trial'' means, in any case not triable by a
jury, a pretrial procedure intended to facilitate settlement
consisting of a summarized presentation of a case to a judicial
officer whose decision and subsequent factual and legal analysis
serves as an aid to settlement negotiations.
8. ``Summary jury trial'' means a flexible nonbinding procedure,
usually reserved for trial-ready cases in which protracted jury
trials are anticipated, and involves a short hearing in which
evidence is presented by counsel in summary form to a jury.
Following the evidentiary presentation, the jury returns an advisory
verdict that forms the basis for settlement negotiations.
B. ``Client'' means the particular client represented by the USA
in the case at issue and, depending on the circumstances, may
include the United States of America or one or more of its agencies,
officers or employees, or other individuals or entities for whom
representation has been authorized.
C. ``Government'' means the United States of America and its
agencies and officers.
D. ``Nonbinding'' means that the parties are not bound by any
resolution unless they agree in advance to be bound. All of the ADR
techniques described in this Guide produce nonbinding outcomes. (In
contrast, the terms ``mandatory'' and ``voluntary'' describe how
cases enter ADR. ``Mandatory'' means that the referral to ADR is
court-ordered; ``voluntary'' means that the referral to ADR is by
consent of the parties.)
E. ``United States Attorney'' includes any duly authorized
designate of the USA.
V. General Case Analysis Criteria
In order to operate successfully, the chosen ADR technique must
be specifically tailored to the particular dispute. Alternative
Dispute Resolution is often appropriate in cases where litigation
will produce an unsatisfactory result regardless of outcome or where
litigation is too slow or cumbersome. Alternative Dispute Resolution
also permits the parties to exercise more direct control over the
dispute resolution remedy. ADR techniques have proven successful in
many categories of cases where the cases are routine (not precedent
setting), such as routine auto torts, slip and fall, and employment
rights cases, or where confidential communication with a neutral
third party will help to clarify issues. Alternative Dispute
Resolution techniques also allow the parties to craft
individualized, nontraditional remedies. The following are some
general suggestions to consider when determining whether to
undertake ADR in a give case.
Use of ADR should be seriously considered in matters involving
contract performance or interpretation disputes, permit or licensing
disputes, discrimination cases or any case in which the parties will
have a continuing relationship regardless of outcome. ADR is also
appropriate in many tort cases.
The use of an ADR technique should be considered, but is often
inappropriate, in cases involving the need to set precedent or to
clarify constitutional issues. In addition, ADR is rarely
appropriate in cases where there are prescribed outcomes or
statutory remedies are inflexible. For example, in Social Security
cases, the agency has no real discretion to depart from the
statutory mandates of the Social Security Act. Finally, in those
cases in which it is clear that the parties are not ready to
negotiate or are opposed to the use of any ADR process, ADR is
inappropriate.
Alternative Dispute Resolution is not meant to replace
traditional negotiation in every case. Rather, it may serve to
provide attorneys with additional tools to facilitate negotiation
where traditional two-party negotiation has not produced an
acceptable resolution or where the presence of a neutral may cause
negotiations to proceed more efficiently.
The following, by way of example but not limitation, are factors
to consider when determining whether to use ADR and when determining
which ADR technique will be most suitable in a given case:
A. General Considerations. The following is a list of factors to
consider and analyze when determining whether and when to use ADR in
a given matter. These factors are neutral in the sense that whether
they militate in favor of or against the use of ADR depends entirely
upon the specific facts and circumstances of the case at issue.
1. The parties' purpose in filing the lawsuit demonstrates an
agenda separate from the specific issues in the case.
2. Case procedural history, i.e., what administrative
proceedings have preceded filing in court.
3. Assessment of likely outcome including likelihood of appeal.
4. Where is the case in the discovery process? Has all of the
information necessary to settle the case been discovered?
5. Where is the United States in terms of procuring settlement
authority? Is more information necessary before authority can be
obtained?
6. Who is in charge of the litigation, parties or counsel?
7. Are factual disputes significant?
8. Are legal disputes significant?
9. Are parties individuals, corporations or other governmental
entities, and how does that affect their ability to participate in
ADR process?
10. Witness credibility and its impact on the litigation.
11. Are there individuals or entities with interests in the
outcome who are not parties to the case?
12. There has been prior extensive administrative process.
13. Position on the court docket.
14. Expenses of litigation versus expenses of ADR.
B. Factors That Generally Favor ADR. 1. If suit is one facet of
a deeper dispute necessitating remedies unavailable to the court,
for example, where the remedy available through the litigation may
be different from the true agenda of the opposing party, ADR may be
helpful to resolve the larger, underlying dispute by permitting the
parties to fashion remedies not available to the court.
2. The relationship between the parties will continue beyond the
resolution of the litigation. For example, in employment dispute
cases where the plaintiff will continue to be employed by the
agency, ADR may help to resolve the issues while minimizing damage
to an employment relationship that will continue beyond the
litigation.
3. There will be detrimental impact on parties, witnesses, and
evidence because of crowded court dockets and projected trial dates.
4. Any of the parties has limited resources.
5. The relative resources of the parties are unequal.
[[Page 36911]]
6. Relative positions of multiple parties (while the entire case
may not be resolved, with multiple parties, disputes may be narrowed
for trial).
7. There is a need for confidentiality.
8. There is a large administrative record in cases involving APA
review.
9. The client or other participants in the litigation may
benefit from the input of an impartial third party.
C. Factors That Generally Disfavor ADR. 1. There is a need for
precedential decision.
2. There is a need for resolution of public policy issues or
constitutional issues.
3. There is a parallel criminal investigation or proceeding
involving the parties or circumstances of the case.
4. There is a strong likelihood of swift resolution on
jurisdictional or other legal issues.
5. The United States has reason to believe that the opponent is
engaging in fraudulent or criminal behavior. For example, in an auto
tort case there is reason to believe that the accident has been
staged.
6. It is believed that settling the case would encourage future
meritless litigation.
VI. Designation of Cases
A. The ADR techniques which may be appropriate for a case depend
upon many specific factors peculiar to that case. The following
categories of cases are generally ``appropriate for ADR.''
The ADR techniques to consider within the context of the given
case include, but are not limited to, arbitration, early neutral
evaluation, judicial settlement conference, mediation, mini-trial,
neutral expert evaluation, summary bench trial, and summary jury
trial.
1. Drivers, Motor Vehicle Accidents (TODR), Property Damage
(TOPD), Personal Injury (TOPI), Medical Malpractice (TOMM) and
Wrongful Death (TOWD).
2. Employment Discrimination (ED) and Civil Rights Fair Housing
(CRTH), Veteran's Reemployment Rights Act (LBVR).
3. Employment Rights of Government Employees (ER), Back Pay
(ERBP), Adverse Action (ERAA) and Grievance (ERGR).
4. Land/Real Property Condemnation (LDCN) (only where United
States is plaintiff).
5. Commercial Litigation Adversarial Proceeding (COAD), other
claims related to federal assistance programs (COOC) and Recovery of
overpayments made by the government (CORO).
6. Recovery of Health Education Assistance Loans (COHE),
Recovery of National Health Services Corps Scholarships (COHS) and
Civil Penalty (CV).
7. Fraud (FR), Anti-Kickback (FRAK), Government Commercial
Programs (FRCM), False Claims (FRFC), Health Care Fraud (FRHC),
Education (FRED), Environmental (FREV), Medicaid/Medicare (FRME),
Medicare Only (FRMO) and Qui Tam suits (FRQT). In Qui Tam suits,
there must be careful analysis of the relator's position on ADR.
B. The following categories of cases are generally
``inappropriate for ADR'':
1. Notwithstanding that a particular category may be enumerated
in Part VI-A above, any case in which there is a dispositive motion
by the United States Attorney, to which opposition would be
frivolous or insubstantial in the considered opinion of the USA.
2. Government agents sued in their individual capacity, e.g.,
Bivens (TOBI) and other non-government individuals (e.g., witnesses
and jurors) sued in their individual capacities (TOOI). (In Bivens
cases, careful consideration should be given to the fact that the
individual defendant is the client rather than the government.)
3. Any case in which the adverse party appears pro se.
4. Preliminary injunctions/TRO's (IJ) (where United States or
its agency is a defendant).
5. Foreclosure/Liens (COMC).
6. Constitutionality of Statute (CN).
7. Social Security cases (SS) and all related causes of action
as presently structured.
8. Any case in which the United States Attorney has determined
that a precedent setting decision is required on a significant issue
in the case.
9. Freedom of Information Act (FO).
10. Privacy Act (PV).
11. Immigration (IM).
12. Prisoner Cases (PC), Post Conviction Sec. 2255 (PCST),
Habeas Proceedings (PCHC).
13. Asset Forfeiture (COFF).
C. With the client's consent and input, the United States
Attorney should consider voluntary participation in ADR in cases
specifically designated as generally ``inappropriate for ADR,''
including those designated in Part VI-B above, under the following
circumstances:
1. The United States Attorney believes that the enhanced
communication available through ADR will increase the likelihood of
settlement or the scope of settlement options under construction.
2. The United States Attorney foresees a substantial probability
that, even in the absence of complete settlement, ADR will result
either in a stipulation narrowing the scope of disputed issues or a
more focused, mutual effort of the parties to tailor further
discovery to material issues that are genuinely disputed.
D. This Guide reflects recommendations formulated within the
context of practice in United States Attorneys' Offices and may vary
from guidance provided by other DOJ litigating components because of
different underlying policy considerations.
VII. Specific Guidance for Cases Designated As Generally ``Appropriate
for ADR''
With respect to those categories of cases designated as
``appropriate for ADR'' in Part VI-A above and not otherwise
excluded by Part VI-B, it is recommended that USAs pursue the
following course:
A. With the client's consent and input, engage in genuine
settlement discussions with opposing counsel at an early practicable
opportunity and at reasonable times thereafter for the purpose of
settling the case even without the necessity of ADR, if possible and
appropriate under the circumstances.
B. Notify the court in writing, either in such case management
reports or pretrial statements as may be filed under Fed. R. Civ. P.
16 or under applicable local rules or otherwise, of:
1. The client's willingness, if any, to participate in ADR;
2. The client's preferred ADR technique, and
3. The preferred timing of ADR under the circumstances of the
case (e.g., before, during or after discovery, before or after
ruling on dispositive motion(s)).
C. Participate in ADR if ordered by the court or, with the
client's consent, voluntarily, with such notice to the court of the
employment of ADR as the circumstances may suggest.
VIII. Specific Guidance for Cases Designated As Generally
``Inappropriate for ADR''
With respect to those categories of cases designated as
``inappropriate for ADR'' in Part VI-B above, it is recommended that
USA's:
A. With the client's consent and input, engage in genuine
settlement discussions with opposing counsel at an early practicable
opportunity and at reasonable times thereafter for the purpose of
settling the case, if possible and appropriate under the
circumstances;
B. Participate in ADR if ordered by the court;
C. Participate in ADR voluntarily with the consent of the client
at the discretion of the USA, if circumstances, including but not
limited to those set forth at Part VI-C above, suggest that ADR may
enhance the opportunity for a cost-efficient resolution of the case.
IX. Training Program
A. Current Training: The Office of Legal Education (OLE), EOUSA,
has played a leading role in ADR and negotiations training. An ADR
Seminar, where ADR is the exclusive subject, is offered twice a year
by the Legal Education Institute (LEI) (whose primary target is
agency counsel) and twice a year in the Attorney General's Advocacy
Institute (AGAI) (whose primary target is AUSAs and Department of
Justice Trial Attorneys). In addition, ADR is taught as part of
several LEI and AGAI courses including: the Negotiations Skills
Course, offered three times a year; the Federal Administrative
Process Course, offered two to three times a year; the Civil Chiefs
Seminar, offered for Supervisory Assistant U.S. Attorneys each year;
the Affirmative Civil Enforcement Course, offered twice each year;
the Advanced Civil Trial Course, offered at least once each year;
and the Civil Practice Seminar, offered three times a year.
The Office of Legal Education also has an extensive video and
audiotape lending library which includes several selections on ADR
issues. The Office of Legal Education continually updates this
library and makes it available to all USAOs offices and DOJ
litigating divisions.
B. Future Training: The Office of Legal Education will develop
future training within existing budgetary constraints in
consultation with the USAOs, the AGAC Working Group on ADR and the
Senior Counsel for ADR.
[[Page 36912]]
X. Internal Procedures for Authorization and Funding
A. ADR Officer: The USA shall designate one AUSA as the ADR
Officer who shall oversee, implement and monitor the ADR activity
within the district's civil litigation. It is suggested that the
Civil Chief of the district be designated the ADR Officer.
The ADR Officer will be responsible for coordinating ADR
activity within the district. Specific responsibilities of ADR
Officers include:
1. Ensuring that each AUSA with civil litigation responsibility
receives comprehensive basic training in negotiation and ADR with
periodic supplemental training.
2. Coordinating the district's collection and reporting of
statistics consistent with the provisions of section XIII of this
Guide.
B. ADR Reporting Responsibilities: Each district will be
responsible for making an annual report to EOUSA showing the
frequency and type of ADR techniques utilized within the year and
whether ADR was instrumental in resolving the litigation prior to
trial.
C. Withdrawal From ADR Activity: The United States retains the
right to object and withdraw from any ADR activity where the USA or
his designate has made a determination that the selected neutral
should be disqualified under conditions analogous to those found
within 28 U.S.C. Sec. 455. It is recommended that the USA or his
designate should promptly communicate this objection and withdrawal
to the Clerk of Court and should strive to identify an alternative
neutral acceptable to the court and all parties prior to objection
and withdrawal.
XI. Selection Criteria for Appointment of Neutrals
A. Selection Criteria for Neutrals: Factors to be considered
when selecting a neutral include, but are not limited to:
1. Whether the neutral is an attorney;
2. What other training or expertise the neutral possesses;
3. Experience in the technical area of the dispute;
4. Experience in ADR processes;
5. Experience in government litigation;
6. Experience in multiparty litigation;
7. Whether the neutral knows counsel and the nature and context
of that knowledge; and,
8. Cost associated with hiring neutral.
B. Selection and Certification: Any person qualified as a
neutral by a federal judicial officer or pursuant to the rules
promulgated by the highest court of a state, its legislative bodies
or other government sanctioned ADR unit and who is not disqualified
or disqualifiable under conditions analogous to those found within
28 U.S.C. Sec. 455 may act as a neutral in a case or matter
involving the United States.
XII. Payment of Fees and Expenses Associated With ADR
A. Neutrals: Neutrals shall be paid for through the neutrals
fund established through JMD and in the manner prescribed by EOUSA.
B. Expert witnesses: Shall be paid in the same manner as expert
witnesses in any civil litigation within the USAO.
C. Fact witnesses: Shall be paid in the same manner as fact
witnesses in any civil litigation in the USAO.
Other fees and expenses: Fees and expenses associated with ADR
proceedings, other than fees for neutrals, shall be paid from the
litigation expense budget of the USAO.
XIII. Designation of ADR Coordinators
The following are designated as ADR coordinators for the USAOs
and EOUSA:
1. William D. Wilmoth, United States Attorney for the Northern
District of West Virginia, 304-234-0100
2. Jeanette Plante, Special Assistant United States Attorney,
Executive Office for U.S. Attorneys, 202-616-6444
XIV. Statistics
The Executive Office will collect statistics on the use of ADR
in the Districts. The statistical collection plan will be developed
in consultation with the USAOs and the Senior Counsel for ADR and
will be as minimally burdensome as possible.
XV. Miscellaneous
USAO Employees Serving As Neutrals: USAO employees, with the
written approval of the United States Attorney, may render services
as a ``neutral'' on a case by case basis when it has been determined
that the United States has no known or future interest in the
litigation and the USAO employee ``neutral'' is not disqualified
under conditions analogous to those found within 28 U.S.C. Sec. 455.
The USAO employees who render services as a ``neutral'' may not
receive reimbursement for said services, except for travel and per
diem.
Tax Division--Policy for Tax Litigation
Introduction
On April 6, 1996, the Attorney General signed an order promoting
broader use of Alternative Dispute Resolution as a toll for
resolving disputes between the government and its citizens in as
prompt, efficient, and inexpensive a manner as possible. Alternative
Dispute Resolution (``ADR'') is any non-binding dispute resolution
process facilitated by a third-party neutral. ADR methods include,
but are not limited to, arbitration, mediation, early neutral
evaluation, neutral expert evaluation, mini-trials, and summary jury
trials. ADR may be conducted pursuant to the agreement of the
litigants, or it may be court-mandated.
Policy
the Tax Division always has had, and continues to have, a policy
of settling cases, where appropriate, as early in the litigation as
reasonably possible. I believe that the use of ADR will further this
Division policy. Therefore, Tax Division attorneys are expected to
use ADR in appropriate cases and to cooperate with and support
court-annexed or court-sponsored ADR programs.
Tax Division lawyers should consider the use of ADR in all civil
cases within the Division in a manner consistent with our
enforcement objectives and the need for consistent treatment of
similarly situated taxpayers. In cases where the attorney assigned
to the case, in consultation with his or her reviewer, believes that
ADR may be appropriate, he or she should consider using an
independent third-party neutral through a court-sponsored program,
from another government agency, or from outside of the government.
Where court-sponsored and/or court-annexed ADR programs are
available, Division attorneys are expected to utilize and
participate fully in such programs in all appropriate cases.
The Tax Division has a strong record of resolving disputes
through settlements achieved through traditional negotiation between
counsel. I expect that all attorneys in the Division will continue
to use their negotiation skills to settle cases where settlement is
appropriate. ADR is not a substitute for traditional negotiation,
but rather provides attorneys with additional tools to facilitate
settlement of cases on an appropriate basis at the earliest state at
which such a settlement reasonably can be reached. Knowing how and
when to settle a case is as important as knowing how to try a case.
ADR processes can be important tools in the prompt and fair
resolution of tax disputes and the skilled use of negotiation and
ADR processes is part of the responsibility of every attorney in the
Division. To facilitate the greater use of ADR, as well as to
improve attorneys' negotiating skills in general, all Division
attorneys will be required to participate in comprehensive and
continuing training in both negotiation and ADR.
It is the policy of the Tax Division, in making promotions and
giving awards and other professional recognition, to recognize the
outstanding contributions of trial attorneys in skillfully
negotiating settlements as well as in trying cases. Thus, skillful
use of ADR will likewise be considered in evaluating attorneys and
recognizing their contributions to the Division.
Attached is a set of case selection criteria to be used by the
Civil Trial Sections, Court of Federal Claims Section, Appellate
Section, and Office of Review in evaluating whether and when ADR is
appropriate in a particular case.
Tax Division--Alternative Dispute Resolution
Case Selection Criteria
Alternate Dispute Resolution (``ADR''), as used here, is any
non-binding dispute resolution process facilitated by a third-party
neutral, whether or not appointed by a court. The Tax Division
presently resolves a large number of its cases through settlements
negotiated through traditional two-party negotiation and believes
that it will continue to do so. ADR is not meant to replace
traditional negotiation, but rather to provide attorneys with
additional tools that may facilitate negotiation of settlement where
traditional two-party negotiation has not produced an acceptable
resolution or where the presence of a third party may cause
negotiations to proceed more quickly or efficiently.
One of the advantages of ADR is that it gives the parties to a
dispute the flexibility
[[Page 36913]]
to fashion their own procedures for resolving the dispute. There are
almost as many kinds of ADR as there are parties and disputes. Thus,
in evaluating whether ADR processes may be useful, there are no hard
and fast rules. Attorneys should begin considering whether ADR might
be helpful in a particular case at the beginning of the litigation
and should continue to revisit the question throughout the progress
of the case. Such analysis must take account of the ADR processes
that may be available through or imposed by the court in a
particular district or circuit.\1\ Attorneys also should keep in
mind that many different kinds of ADR are available both through the
courts and independent of the courts. Some forms of ADR may be more
useful than others at particular points in the litigation. For
example, early neutral evaluation, a process whereby a third-party
neutral evaluates each side's case and helps the parties agree on
the most efficient method of exchanging factual material, is most
appropriate at the beginning of litigation and can be a useful tool
in quickly obtaining a better understanding of the strengths and
weaknesses of your case. By contrast, mediation, a process where a
third party facilitates negotiation between the parties, may be most
useful after the case has been more fully developed.
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\1\ The taxpayer should be required to provide a waiver of 26
U.S.C. 6103 as a condition of the government's agreement to
participate in ADR other than ADR imposed by the Court. In the
absence of such a waiver, the government might not be able to make a
full factual disclosure to the third-party neutral which would
substantially undermine the utility of the ADR process.
---------------------------------------------------------------------------
This statement on ADR relates to the government's voluntary
participation in ADR. Nothing herein shall be construed to limit the
government's duty to participate in ADR pursuant to court order or
applicable local rules, except that Tax Division attorneys shall
resist participation in ADR, by appropriate motion, whenever said
participation would violate the U.S. Constitution or other governing
law or would not be in the best interest of the United States.
This statement shall not be construed as creating any right or
benefit, substantive or procedural, enforceable at law or in equity,
by a party against the United States, its agencies, its officers, or
any other person. This statement shall not be construed to create
any right to judicial review involving the compliance or
noncompliance of Tax Division attorneys with its terms.
The following is a list of factors to assist attorneys in the
Tax Division in determining whether to use ADR in a particular
case.<SUP>2 Not all listed factors will have relevance in any given
case and factors not listed below may also be present that weigh in
favor of or against the use of an ADR process.
---------------------------------------------------------------------------
\2\ Many of these factors are equally applicable in determining
whether a case should be settled using traditional, unassisted
negotiations.
---------------------------------------------------------------------------
Factors Favoring ADR
1. The case involves largely factual issues and the legal
principles are well established (e.g., valuation cases,
substantiation cases, trust fund recovery cases).
2. The case is legally and/or factually complex.
3. The case involves multiple independent factual issues (e.g.,
bankruptcy cases).
4. The case is one where there is a particular need for a prompt
resolution of the dispute (e.g., summons, estate tax and bankruptcy
cases).
5. The case is one where a consensual resolution may lead to
greater future compliance (e.g., employee-independent contractor
cases).
6. A settlement in the case would be based solely on
collectibility.
7. The other party has a particular need to keep information
confidential (e.g., financial information or trade secrets).
8. There are problems perceived either with respect to the
decisionmaker or the forum, for example:
a. The judge is particularly slow in resolving cases;
b. The docket is backlogged with criminal and/or civil cases;
c. There is the potential for jury nullification.
9. The case is one where the Government will be required to
litigate in a forum other than a federal court.
10. The case is one where the nature or status of a party to the
dispute might, in itself, influence the outcome of the litigation
(e.g., sympathetic plaintiff).
11. The case is one where there are substantial litigating
hazards for both parties.
12. The case is one where trial preparation will be difficult,
costly and/or lengthy and the expected out-of-pocket and lost
opportunity costs outweigh any benefit the government can
realistically expect to obtain through litigation.
13. The case is one where it is desirable to avoid adverse
precedent.
14. The case is one where either the party or the attorney may
have an unrealistic view of the merits of the case or an
unreasonable desire to litigate, with insufficient regard for what
may be in the client's best interest.
15. The case is one where the other party has expressed an
interest in using ADR.
16. The case is one where the working relationship between the
parties or their counsel suggests that the intervention of a neutral
third party would be beneficial.
17. The case is one where traditional negotiations will be
difficult and protracted.
18. The case is one where the progress of settlement discussions
may be improved by a third-party neutral's ability to conduct frank,
private discussions with each of the parties.
Factors Disfavoring ADR
1. Taxpayer's case clearly has no merit (e.g., certain Bivens
cases or protestor suits).
2. The case is one that should be resolved on motion, such as a
motion to dismiss or for summary judgment.
3. The case presents an issue where legal precedent is needed,
for example:
a. Issue involved is of national or industry-wide significance;
b. Issue is presented in a substantial number of cases;
c. Issue is a continuing one with same taxpayer.
4. The importance of the issue involved in the case makes
continued litigation necessary despite some adverse precedent.
5. The information presently available about the case is
insufficient to evaluate meaningfully the issues involved or
settlement potential.
6. The case involves significant enforcement issues, for
example:
a. Case involves protestors;
b. Case is high profile and will involve publicity which could
encourage taxpayer compliance;
c. Case involves a uniform settlement position (e.g., shelter
cases).
7. The case involves a constitutional challenge.
8. The case is one where government concession is under
consideration.
9. The case is one which is very likely to settle through
traditional negotiations within a reasonable time after the facts
have been ascertained, without a third-party neutral.
10. The case is one where Court imposed scheduling makes use of
ADR impractical (e.g., ``rocket-dockets'').
11. The case is one where the other party has already engaged in
ADR at the agency level.\3\
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\3\ For purposes of this factor, normal agency administrative
procedures, such as appellate conferences or administrative claims
review, are not considered to be ADR procedures.
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12. The case involves 26 U.S.C. Section 6103 information or
privileges which would prevent open discussions with a third-party
neutral (e.g., case involving request for third-party tax return
information).
[FR Doc. 96-17744 Filed 7-12-96; 8:45 am]
BILLING CODE 4410-01-M