6 Reasons Why Bankruptcy Mediation is a Process, not a One-and-Done Session: PART ONE — A DIFFERENT MEDIATION MODEL

This model is great! But a different model is needed for today’s roads. [This car is at the Museum of Speed in Lincoln, NE]
By Donald L. Swanson

Bankruptcy needs a larger mediation process than the one-and-done-session model that’s common in non-bankruptcy cases

An iteration of the title above [“Bankruptcy mediation is a process, not a one-and-done session”] is often greeted by bankruptcy professionals with blank stares.   They can’t imagine why they’d want to mediate bankruptcy disputes any differently from how they mediate disputes in other courts.

And reactions that go beyond blank stares tend to be something like this:

–“We need a different model of mediation for bankruptcy?   Right.   Sure thing.”  [Cue high voltage sarcasm here.]

–“You want a larger role for mediators?  . . .  So we have to pay them more?   That’s a winner.  Good luck with that one.”  [Again, cue high voltage sarcasm.]

But a different model, a more-intensive and more-extensive mediation process, and a larger role for mediators, are precisely what I mean—and precisely what is needed in contested matters and many adversary proceedings.

The reality is that bankruptcy mediation processes often involve multiple parties and can last “for months.”  So says Judge Gerald Rosen, an innovator in bankruptcy mediation who served as chief mediator in Detroit’s bankruptcy case (see this Wall Street Journal interview).

This post is Part One in a series of six articles explaining how and why bankruptcy mediation needs a different model from the one-and-done session commonly used in non-bankruptcy cases.

Action Item.  Before blindly following a one-and-done mediation model from non-bankruptcy cases, we need to consider how each bankruptcy mediation might differ from non-bankruptcy contexts.

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