Mediator Standards of Conduct Could Have Helped Here

Where should lawyers seek guidance in determining potential conflicts of interest regarding mediation? Michigan’s Standards of Conduct for Mediators are an overlooked resource here. A recent case bears this out (Great Lakes Home Health Services Inc v Carolyn Ewing, lv gntd Michigan Court of Appeals Case No. 357907).

Mr. Mediator, an attorney with the M law firm, was appointed to mediate a case between two health care companies involving employees who left one company to work for the other. Two similar cases were filed in other counties, involving the same parties and the same allegations. A half-day mediation in May of this year did not result in an agreement.

Several weeks after the mediation, the M law firm agreed to represent the defendant health care company in all three cases. Plaintiff moved to disqualify the M law firm from representing the defendant, since one of the M firm’s lawyers had previously mediated a companion case. The trial court determined that the M law firm need not be removed, as long as an ethical screen was erected to prevent Mr. M from sharing any confidential information gleaned from the mediation with his law partners. Plaintiff was granted leave to appeal.

The M law firm points out that Mr. M is legally bound to maintain the confidentiality of the mediation, pursuant to the Agreement to Mediate that all parties signed. Is that sufficient? Can we trust that Mr. M won’t share with his partners any information regarding the plaintiff learned in the mediation? Even if he doesn’t actually share information, does it still look bad? Is there still an appearance of impropriety here such that the firm should decline the case? Where should lawyers look for answers?

Plaintiff asserts that the trial court relied on the wrong provision in the Michigan Rules of Professional Conduct. The M law firm says it consulted the Michigan Rules of Professional Conduct, two former chairs of the ADR Section of the State Bar of Michigan, as well as a lawyer who specializes in professional responsibility. What no one seems to have consulted are the Standards of Conduct for Mediators.

Michigan’s Standards of Conduct include Section III, Conflict of Interest. The first sentence states, “A mediator should avoid a conflict of interest or the appearance of a conflict of interest both during and after mediation.” This seems to me to be a clear case of an appearance of a conflict of interest after a mediation. Section III. G. addresses whether a mediator may enter into a relationship after the mediation is completed:

“In considering whether establishing … another professional relationship with any of the participants after the conclusion of the mediation process might create a perceived or actual conflict of interest, the mediator should consider factors such as time elapsed since the mediation, consent of the parties, the nature of the relationship established, and services offered.”

In this case, at least two of those factors argue against the M law firm taking the case: the time elapsed was just weeks, and the other party was strongly opposed. In addition, the nature of the relationship was a critical one: a lawyer/client relationship in pending litigation. While Mr. M wasn’t entering into that relationship himself, his law firm was. The Standards would recommend against this relationship.

Attorney-mediators are used to paying attention to potential conflicts at the front end of a case – has their firm represented one of these parties before. This case presents the interesting question of the firm representing a party after the mediation. The Standards of Conduct for Mediators offer guidance in a variety of ethical dilemmas, and they could have helped here.