You are here

B-9019-2. ALTERNATIVE DISPUTE RESOLUTION

(a)   Scope of the Rule

This rule governs mediation. Parties may agree to the use of any other method of alternative dispute resolution.  However, use of arbitration is governed by 28 U.S.C. §§654-657.

(b)   Applicability of the Rule

This rule applies to all contested matters and adversary proceedings.  

(c)   Referral to Mediation:  Process

(1)     Party Request

(A)     Written Request

A party may file a Motion to Refer a Matter to Mediation. If a party certifies in the motion that all parties consent and the Court finds the motion to be appropriate, the Court may enter an order referring the matter to mediation without further notice or hearing. If a motion does not certify the consent of all parties, the motion shall be set for hearing.

(B)     Oral Request

Any party may request referral to mediation at any hearing or conference if all other parties are present.

(2)     Court’s Proposal to Refer to Mediation

The Court may propose to refer a matter to mediation at any time all parties appear before the Court. The parties can oppose referral, indicate consent, or request a separate status conference on the proposal.  

(3)     Order Directing Mediation

If the Court determines that mediation is appropriate, it shall enter an order referring a matter to mediation.

(d)   Jurisdiction and Pendency of Matter:  Deadlines and Discovery

During mediation, the matter remains under the jurisdiction of the Court. Referral to mediation does not abate or suspend any deadlines. Parties may limit discovery to the development of information needed to facilitate mediation.

(e)   Selection of the Mediator

(1)     Selection by Agreement

Parties may select any person to serve as mediator but are encouraged to consider those listed on the Court’s Mediator Panel, available on the Court's website.  The Notice of Selection of Mediator may be filed at any time but no later than 14 days after the order referring the matter to mediation.  This time period may be extended upon motion by any party.  

(2)     Selection of Candidates by the Court

If the parties cannot agree on a mediator, or if the parties elect to request the Court to name a panel for their consideration, a party shall file a Motion to Select a Panel of Mediator Candidates. The Court will issue a Notice of Designation of Mediator Candidates which designates 3 potential mediators.  Each side, alternately, shall strike the name of 1 mediator. The side initiating the controversy will strike first, no later than 3 days after the filing of the Notice of Designation of Mediator Candidates. The parties shall complete the striking process within 7 days of the Court's designation and shall file a Notice of Selection of Mediator. During the striking process, the parties can agree on a mediator and that mediator is not required to be one named on the panel of candidates. If a party fails to strike from the list when required to do so, the first name on the list that has not previously been stricken is deemed stricken by that party with the duty to strike. The other party then exercises its right to strike or, if only one name remains, files the Notice of Selection of Mediator.

(3)     Affidavit

A person selected as a mediator shall prepare an affidavit disclosing any connections with the parties or counsel involved with the controversy which in any way could affect the neutrality or impartiality of the mediator and setting forth any other reason which could result in disqualification under subparagraph (e)(6) of this rule. The affidavit shall summarize the anticipated rate of compensation and terms of payment. The affidavit shall be filed no later than 7 days after the notice specified in subparagraphs (e)(1) and (2) of this rule.  The time for filing the affidavit may be extended upon motion of any party.  

(4)     Qualification and Immunity

A mediator becomes qualified upon the filing of the affidavit required by subparagraph (e)(3) of this rule. To the extent permitted under applicable law, a qualified mediator shall have immunity in the same manner and to the same extent as would a duly appointed Judge.

(5)     Replacement of Mediator

If the mediator is disqualified or withdraws, the parties may agree upon another mediator and file the appropriate notice, or they may request that the Court designate a panel of candidates under subparagraph (e)(2) of this rule.

(6)     Withdrawal or Disqualification

A mediator may withdraw from service at any time by filing a notice of withdrawal. A mediator is also subject to the disqualification rules found in 28 U.S.C.§455. A party may file a Request for Disqualification of Mediator.

(f)   Filing by Mediator

A mediator is not required to be authorized to file electronically. If the mediator does not have the ability to file documents electronically, the mediator may submit documents to the Judge’s chambers and chambers staff will ensure docketing.

(g)   Compensation

The compensation and costs of the mediation shall be borne equally by the parties unless otherwise agreed or ordered by the Court.  If one of the parties is a trustee or a debtor-in-possession, the amount of compensation to be paid by that party shall be treated as an administrative expense and paid by the estate. The mediator shall file a motion for payment of administrative expense, unless compensation was set in the Order Directing Mediation.

(h)   The Mediation

(1)     Control of the Mediation

The mediator shall control all procedural aspects of the mediation, including but not limited to:  

(A)     setting dates, times, and places for conducting sessions of the mediation;

(B)      requiring the submission of confidential statements;

(C)     requiring the attendance of representatives of each party with sufficient authority to negotiate and settle all disputed issues and amounts;

(D)     designing and conducting the mediation sessions; and

(E)     establishing a deadline for the parties to act upon a settlement proposal.

(2)     Termination of the Mediation by Mediator

The mediator may terminate the mediation whenever the mediator believes that continuation of the process would harm or prejudice one or more of the parties; whenever the ability or willingness of any party to participate meaningfully in the mediation is so lacking that a reasonable agreement is unlikely; or whenever the mediator determines that continuing the mediation process would be unsuccessful.

(3)     Termination of the Mediation by a Party

Parties are required to appear for mediation and to participate in good faith. Either party may withdraw from the mediation if the party determines that continuing the mediation would be unsuccessful.   

(4)     Conclusion of the Mediation

(A)     If the mediation results in settlement of the contested matter or adversary proceeding, the mediator or the party who requested the mediation shall within 7 days of the conclusion of the mediation file a Report of Mediation.  Within a reasonable time thereafter, the parties shall submit to the Court an agreed entry, agreed consent to judgment, stipulation of dismissal, and/or motion for approval of compromise or settlement and provide such notice as is required by the Federal Rules of Bankruptcy Procedure or as the Court may direct.  If mediation results in a partial settlement, such that a motion to compromise and settle is not appropriate, the parties may file a Report to Court.

(B)     If the mediation is terminated or does not result in a settlement, and the mediator, after appropriate consultation with the parties and their counsel, is reasonably satisfied that no further mediation effort will be successful at that time, the mediator or the party who initiated the mediation shall file a Report of Mediation with the Court, serving all parties to the controversy, that states only that the mediation was concluded without a settlement.

(5)    Release of Mediator

Upon the filing of the Report of Mediation under subparagraph (h)(4) of this rule, the mediation shall be deemed concluded and the mediator shall be relieved of all further duties or responsibilities.

(i)   Confidentiality

(1)     Protection of Information Disclosed at Mediation

Any written or oral communication made during mediation is confidential unless otherwise agreed by the parties.  The unauthorized disclosure of confidential communication by any person may result in the imposition of sanctions under subparagraph (j) of this rule.  In addition, without limiting the foregoing, Rule 408 of the Federal Rules of Evidence and any applicable federal or state statute, rule, common law, or judicial precedent relating to the privileged nature of settlement discussions, mediation, or other alternative dispute resolution procedure shall apply.  Information otherwise discoverable or admissible in evidence, however, does not become exempt from discovery or admission, because of its use in mediation.  If the Court so orders, the mediator's report on the parties' participation, to assist the Court in determining if the parties participated in the mediation in good faith, shall not be considred a violation of these confidentiality requirements.

(2)     No Discovery from Mediator

The mediator shall not be compelled to disclose to the Court or to any person outside the mediation conference any information received or distributed by a mediator while serving in such capacity.  The mediator shall not testify or be compelled to testify concerning the mediation in any other proceeding.  The mediator shall not be a necessary party in any proceeding relating to the mediation.  

(3)     Protection of Proprietary Information

The parties, the mediator, and all mediation participants shall protect proprietary information during and after the mediation.

(4)     Preservation of Privileges

The disclosure by a party of privileged information to the mediator or to another party during the mediation process does not waive or otherwise adversely affect the privileged nature of the information.

(j)   Sanctions

Upon motion by any party, the Court may impose sanctions against any person who fails to comply with this rule.