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The benefits of early neutral evaluation

The US District Court for the Eastern District of Missouri has dusted off an ADR tool used infrequently in Missouri but effective in certain cases known as Early Neutral Evaluation. Recently, the court ordered two cases out to ENE with successful results. ENE is a full, balanced and unbiased evaluation of a case by a neutral which can be in writing or verbal and can be done in person or remotely. The neutral identifies each side’s strengths and weaknesses and the “likely” outcome at trial without binding either side or reporting the anticipated “likely” outcome to the assigned judge. ENE often is used soon after a case is filed and can act as a precursor to settlement discussions or, at least, to a better assessment of the dispute. In other circumstances, ENE has been used well into the case after the positions have developed and one side or the other requires (in the court’s opinion) a “gut check” on a realistic outcome. The authors each were chosen to act as early neutral evaluators in two recent cases.

The first case to be sent to ENE involved an individual with appointed counsel on one side and the government on the other. The case was in the summary-judgment stage; however the parties seemed to view the facts so very differently that the court ordered both ENE and mediation. The first step was to get all parties on the same page about what the ENE process would look like. The neutral explained orally and later in writing that as Local Rule 16-6.01(B) provides, ENE is intended to bring “together parties and counsel in the early pretrial period to present case summaries before and receive a non-binding assessment from an experienced neutral evaluator.”

As noted, “[i]mmediate settlement is not a primary purpose of this process,” although the court in that case had ordered a subsequent mediation as well. By providing a neutral evaluation, the neutral intended to meet the ENE expectations of the court and, as expressed by the American Bar Association, to “provide a balanced and unbiased evaluation of the dispute [and] identif[y] each side’s strengths and weaknesses” that might “assist the parties in assessing their case and may propel them towards a settlement.” (See Early Neutral Evaluation, American Bar Association)

In this particular case, at the preference of the parties, the ENE process was completed on the papers — essentially a scaled-back version of the summary-judgment motion already on file. The neutral issued an “opinion” on the strengths and weaknesses of each of the claims, commenting on the credibility of the facts and evidence so to give each side an assessment of their likelihood of prevailing — in a non-binding fashion, of course. After both sides reviewed the “opinion,” the parties and neutral met in-person for a full day of mediation, and ultimately, the case settled. It is difficult to predict, but it is likely no settlement would have been reached that day without the groundwork laid by the parties and neutral going through the ENE process.

The second case referred to ENE involved a pro se plaintiff claiming a retaliatory discharge from her employer. The court ordered the case to ENE and designated lead counsel to represent plaintiff for the limited purpose of ENE. Local rules allowed the designated counsel to receive a capped fee from the court for the representation. ENE rules in federal court [Rule 16-6.01(B)] and Missouri [Rule 17.01(b)] explain that the neutral renders a non-binding assessment early in the case to encourage communication between parties and provide some realistic feedback to the parties. So often mediators act as facilitators, cautiously serving up an evaluation of the case only late in the mediation. In “Mediator School,” we are taught to evaluate only when the parties expressly ask for it, and even then to couch the evaluation in bland, non-judgmental tones.

The ENE cuts right through this foggy process and demands the neutral evaluate the case up-front. The court had ordered an in-person ENE session attended by decision makers with authority. The neutral arranged the ENE soon after the referral. The parties each submitted written statements with a summary of disputed facts and a narrative of all positions including liability and damages. They borrowed some of the more-defined ENE processes from the federal court in the Eastern District of California (ADR Local Rules 5-1 et seq.)

The ENE began in separate rooms with a short chat, much like mediation, and thereafter the parties gathered in one larger room. Everyone was curious about how this ENE process would work. After a reminder that the court had tasked the neutral with making an evaluation, the neutral proceeded to give a verbal evaluation with a candid assessment of strengths and weaknesses, an opinion of the likely outcome and the likely date of trial and costs — most importantly, emphasizing the time lag and future costs to plaintiff (deposition fees etc.)

The pro se plaintiff, with a temporary, well-prepared and experienced attorney next to her, realized the true value of her case. The neutral offered to continue the conversion, and the parties wanted to caucus to think about settlement. After a 20-minute recess, the parties agreed to morph the ENE into a mediation. After a few exchanges of offers and demands, the parties reached a settlement. The ENE provided the structure to follow, moving the case to settlement faster that day. The neutral could be forthright in giving a legal assessment without worry about overstepping the bounds.

In these cases, ENE worked to resolve the cases early after filing and thus saved the parties money and time. As the neutrals, we liked the freedom to evaluate and offer to mediate thereafter. Consider ENE in your next case.


Bridget Hoy, Kim Kirn

Bridget G. Hoy is a mediator with Alaris and attorney with Lewis Rice. Kim L. Kirn is an attorney and mediator with USA&M.