Tuesday, April 7, 2015

Mediators Beware! Full Disclosure Required #MediationEthics

I have had this discussion with mediators a number of times.  Most good mediators realize that they must make the same recusals and disclosures of real or apparent conflicts of interest as a hearing officer/court judge. Invariably, however, when I do a mediator training, I run into one person who feels that mediators are not required to make the same level of disclosures because they will not be deciding a case; they are merely there to help the parties come up with their own settlement. Blah, blah, blah...

Well a big federal appellate decision last year may shed some light on this topic.  PLEASE NOTE: this is not a special education case, but it is a decision by the Federal Circuit Court of Appeals and it has ramifications for all mediators! 

The decision came in the case of CEATS, Inc v. Continental Airlines, Inc, et al ___ F. 3d _____(Fed. Cir. 6/24/2014). The United States Supreme Court denied certiorari for this case, Docket # 14-681, on March 23, 2015.

In this case, a mediator failed to fully disclose his prior relationships with counsel for one of the parties.  Here is what the court said about mediator neutrality with regard to recusal/disclosure:

"Although we recognize that mediators perform different functions than judges and arbitrators, mediators still serve a vital role in our litigation process. Courts depend heavily on the availability of the mediation process to help resolve disputes. Courts must feel confident that they are referring parties to a fair and effective process when they refer parties to mediation. And parties must be confident in the mediation process if they are to be willing to participate openly in it. Because parties arguably have a more intimate relationship with mediators than with judges, it is critical that potential mediators not project any reasonable hint of bias or partiality. Indeed, all mediation standards require the mediator to disclose any facts or circumstances that even reasonably create a presumption of bias. E.g., Am. Bar Ass’n Model Standards of Conduct for Mediators (“ABA Standards for Mediators”) § III.C (2005) (“A mediator shall disclose, as soon as practicable, all actual and potential conflicts of interest that are reasonably known to the mediator and could reasonably be seen as raising a question about the mediator’s impartiality.” (emphasis added)). This duty to disclose is similar to the recusal requirements imposed on judges. Compare ABA Standards for Mediators § III.C (“A mediator shall disclose, as soon as practicable, all actual and potential conflicts of interest that are reasonably known to the mediator and could reasonably be seen as raising a question about the mediator’s impartiality.” (emphasis added)) with 28 U.S.C. § 455(a) (“Any justice, judge, or magistrate judge of the United States shall disqualify himself in any proceeding in which his impartiality might reasonably be questioned.” (emphasis added)). While mediators do not have the power to issue judgments or awards, because parties are encouraged to share confidential information with mediators, those parties must have absolute trust that their confidential disclosures will be preserved. ... Indeed, mediation is not effective unless parties are completely honest with the mediator. ... Just as a judge is required to recuse himself under § 455(a) whenever “his impartiality might reasonably be questioned,” mediators are required to disclose a potential conflict whenever there are facts and circumstances that “could reasonably be seen as raising a question about the mediator’s impartiality.” ABA Standards for Mediators § III.C (emphasis added)."

The court then went on to find a breach of the duty to disclose by the mediator. Although the court refused to grant relief from the ensuing judgment against CEATS, the court expressly disagreed with the lower court's finding that the mediator had no duty to disclose his previous dealings  with one of the law firms involved in the litigation. (hat tip to Mary Kate Coleman for "Full Disclosure," The WV Lawyer Jan-March 2015 at p.36)

I strongly urge all mediators to study this decision and review their ethical obligations, including the duty to disclose/recuse.  You can read the entire decision here.  Here is a summary of the decision.  

The amazing CADRE website has many excellent resources for special education mediators.  The CADRE link is a permanent part of the lefthand side of this blog. Special education mediators and others involved in dispute resolution should visit it frequently.

What do you think? Should ethical considerations such as these be a required part of mediator training? Are special ed mediators doing a good job?  Is mediation the best way to resolve a special ed dispute? If IDEA is eventually reauthorized, should there be changes to the mediation provisions?


  1. The case visit to SCOTUS that was denied certiorari was definatly about awareness and uniformity with the mediators responsibility. This was a perfect case to have the high court look at due to the multiple levels of perception of the current requirements.
    Did you know, that while the two court ordered mediation proceedings were being held between Ceats and the defendent's, the court appointed mediator, Judge Faulkner and the law firm for the defendent's were in litigation for non-disclosure in another court case. At the very time Ceats was ordered by a Federal Judge to participate in mediation, with Markman granted in July 2011, a managing partner for the defendants legal team was defending the actual Mediator, Judge Faulkner and another junior partner of his firm.
    The other trial was concluded with a reversal of Faulkners order which overturned the case, stating that there was premeditation and deception executed by both members, whom even pretended not to know each other. Really, how does that happen?

    Neither Federal Judge Davis, Judge Faulkner, JAMS (Faulkner's firm) or defendants lawyers ever notified CEATS of the: 1- the Judge and Firm had a close and personal relationship; 2- the concurring lawsuit being tried for non-disclosure that was ongoing simultaneously during the CEATS trial; 3-the existing relationship was sufficient to overturn a $22 million dollar award.
    Clearly the Appellate should of reversed the CEATS case as well.
    Mediation laws need to be uniform to prevent the following-

    disclosure- failure of a party to tell facts or hand over relevant documents in a legal procedure
    fraud - sharp practice, or breach of confidence, perpetrated forprofit or to gain some unfair or dishonest advantage.
    Collusion-a secret agreement, especially for fraudulent or treacherous purposes;conspiracy

  2. Mike, Thanks for your comment. You seem to be familiar wit this case.