By Dr. Ken Broda Bahm:
When the parties in litigation come together to talk about settlement, that might be seen as the “posturing phase.” Each side is trying to convey the strength and unassailability of their case, while predicting an inevitable victory in trial. Some of that might be considered the rational “puffery” that puts the facts in the best light. If that image management, however, reaches the point of outright dishonesty about your case, then it might be less effective than you think. Recent research shows that a party’s dishonesty in the context of a financial negotiation leaves that party with less overall satisfaction with the deal.
The study (Van Zant, Kennedy & Kray, 2022) was reviewed in a recent American Psychological Association piece and found that “Lying to another person to get the better of them in a financial negotiation might win you more money, but you are likely to end up feeling guilty and less satisfied with the deal than if you had been honest.” The study built on research showing that unethical behavior that can increase satisfaction when done in private, but confirmed that it can turn out differently in interactional settings. What is called “deceiver’s guilt” leads to increased negative affect and reduces satisfaction even when the deception improves your position and goes undetected. Using research participants in negotiating pairs online and in-person, the researchers found that, independent of the setting and regardless of participants’ personal sense of morality and ethics, those who deceived to gain an advantage ended up less satisfied. Receiving greater financial incentive just led to more guilt. Dishonesty also undercut the participants’ willingness to interact with the other party in the future. Now, you may think that hard-nosed attorneys would be immune to that kind of guilt, and that could be true. But in the specific context of case settlement negotiations, there are also more practical reasons to be honest about your case, to yourself, to your neutral, and to your adversary. In this post, I will share the top four ways to make the truth work for you at the settlement stage.
1. Insulate the Advocate
There is a challenge in a system that, on the one hand, experts you to be a zealous and tireless advocate for your side, while on the other hand also asks you to be fair enough and neutral enough to see a correct resolution for the case somewhere in between your position and theirs. The problem is something I call the “advocate’s blinders” — you are so used to persuading on the merits of your case that it can be tough to be clear and honest about the flaws. For that reason, it is a good practice to separate the “advocate” from the “negotiator.” In very high stakes trials, it can often be two different teams playing those roles, but even when the work falls on the same attorney, it is essential to think in terms of separate frames or mindsets, and to be clear about which hat you’re wearing at any given time.
2. Own the Faults
No case is perfect. Rather than using negotiations as a time to maintain a false-front about the pure and untainted righteousness of your own case, it can be a great time to be direct and concrete about your weaknesses. In acknowledging those faults, you most likely won’t be telling the other side anything they don’t already know, but you will be adding to your credibility and potentially stealing their thunder as well. The point is not to agree with your adversary or to negotiate against yourself but to say, in effect, “Look, we have taken a clear-eyed look at this case, we know the problems, and we still think that the position we are offering is the right one.”
3. Conduct and Talk About Research
Part of that clear-eyed look at your own pluses and minuses can also include doing and sharing the steps that you have taken to assess your case. That could mean verdict analysis of other cases in the venue or it could mean specific mock trial or focus group work on your particular case. Of course, it won’t always be credible for you to say, “We did a mock trial and we totally won…” but there are ways to make that kind of message more credible and useful for the other side, or for a mediator. For example, let them know how you did it, explain that it was systematic and not informal, and tell them — sincerely — that you gave their side the benefit of the doubt. Of course, I am not typically privy to the confidential negotiations, but some of my clients have shared that they have disclosed the fact of pretrial research in this way, and at least one client was so confident that he shared the full results with the other side — video and all — and settled the case that way.
4. Play to the Uncertainty
Psychologically, what makes a settlement better than a decision to proceed to trial is that the settlement is a certain and definitive result. That, in itself, has a value that can be translated into dollars. So even as you want to be confident about your advantages, you still want to emphasize as part of the negotiations that a trial carries no guarantees for either side. Researching your case can indicate possibilities and can manage expectations, but it cannot reliably predict your results in trial. Neither side has a crystal ball. So you do want to be honest in stressing that nothing is guaranteed, other than the settlement you’re offering.
Being inflexible, focusing only on your strengths, and, worst of all, being dishonest about the weaknesses of your case — that approach can, at best, be an intimidation tactic. But it isn’t a negotiating stance, and it isn’t likely to settle your case.
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Other Posts on Honesty:
Van Zant, A. B., Kennedy, J. A., & Kray, L. J. (2022). Does hoodwinking others pay? The psychological and relational consequences of undetected negotiator deception. Journal of Personality and Social Psychology.