Just as you were getting used to the process of litigation, you learn that the court has referred your case to mediation. You immediately worry—what if the mediator rules against you, and what does it mean for the case? Here are the basics, what to expect, and how to prepare if your case gets selected for mediation.

What is mediation?

Mediation is a form of “alternate dispute resolution” or ADR, which aims to resolve a case without the need for costly and time-consuming litigation in state or federal court. Mediation differs from arbitration. Arbitration is another form of ADR, in which a decisionmaker (such as a panel of retired judges or practicing attorneys) renders a formal decision that is either binding or non-binding on the parties to the dispute. Whether an arbitration decision is binding is usually dictated by a contract between the parties. In other words, parties who engage in arbitration typically have an agreement under which they agree to arbitration.

Mediation works differently than arbitration. Any party at almost any time in a dispute can seek the services of a mediator. Courts may also choose to send a case to mediation for a variety of reasons, including when it is overly contentious or complicated, or when the amount in controversy is such that mediation would be most beneficial. Many judges will refer a case to mediation before it goes to trial, as an attempt to settle the case without a costly trial.

Mediators do not render formal decisions in favor of one party and against another, as arbitrators do. Instead, mediators serve as facilitators between the parties with the goal of reaching a compromised settlement, without rendering a formal decision. For that reason, mediation is almost never binding (unless the parties agree for it to be). It is simply a way for the parties to reach a settlement—and all parties have to agree to accept the result of mediation. If one party does not like the result, they can simply walk-away from mediation and resume the litigation in court.

How does mediation work?

The first step of mediation is either choosing to go to mediation, or being referred by the court where your litigation is pending. From there, the parties typically work together to select a mutually agreeable mediator, which, like arbitrators, is usually a retired judge or practicing attorney. If the parties cannot agree on a mediator, the court will usually choose one.

Once a mediator is selected, the parties and the mediator will work together to select a date for mediation. Mediation is often an all-day or multi-day event. Mediators often require individuals who have settlement authority to attend a mediation, so it is important to find time where high-level business executives can be available to participate.

In advance of the actual mediation, mediators often require a written statement that sets forth each party’s position in the litigation and also may require the parties to set forth the amount of money it would be willing to pay or accept to settle the case, in addition to any non-monetary terms of settlement. These submissions are typically ex parte, meaning they are only sent to the mediator, not the opposing party or their lawyers.

The mediation typically takes place in the office of the mediator, usually in law firm conference rooms. Sometimes the mediator will bring all parties and their lawyers into a single conference room and give an introduction. The mediator may allow opening statements from each side, but this practice is becoming less common because it often enflames the parties. Typically, each party will be given their own conference room to share with their lawyers, and you may not even see the other side or their lawyers at all during the mediation. The mediator will shuttle between the parties’ respective conference rooms and attempt to broker a deal.

As a party to mediation, you can choose what the mediator is allowed to tell the other side, or whether he or she is required to keep the information confidential. The ability to have candid and honest conversations with the mediator about your settlement position is a unique and practical component of mediation. Mediators will sometimes choose to point out weak aspects of your position, but this is not a formal “ruling” by the mediator. It is a tactic used by mediators to soften a party’s position with the goal of reaching resolution.

If at any point you feel the mediation is not being productive, you may choose to walk away. However, it is important to come to mediation in good faith and with an open mind geared toward compromise and settlement. The ultimate goal in mediation is to execute a settlement agreement, which will bring the litigation to a close. Mediators will assist in negotiating monetary and other non-economic terms to be included in the settlement agreement.

How can you prepare for mediation?

The best way to prepare for mediation is to work with your attorneys to craft a strong mediation position submission and to keep an open mind about settlement. This often means taking a close look at litigation costs, risks, and the benefit of resolving a case without the court making a formal ruling, either in your favor or against you. You should also carefully consider who should attend a mediation on your behalf, including those with intimate knowledge of the facts and those with an understanding of the finances implicated.

The biggest benefit of mediation is there is little risk. In the best-case scenario, you resolve your case and the litigation ends. In the worst case, you lose some time mediating, but your case will resume in court just as you left it. For that reason, mediation is a helpful tool that should be welcomed in most cases.