Local Rule 9019-1: MEDIATION

TNWB LBR 9019-1 MEDIATION

(a) Types of Matters Subject to Mediation. Upon consent and/or request of the parties, the court may assign any dispute arising in a bankruptcy case to mediation, whether or not any contested matter or adversary proceeding is presently pending with respect to the dispute. Parties to a contested matter, adversary proceeding, or dispute not yet pending before the Court may also stipulate to mediation subject to court approval.

(b) Mediator. The court may, subject to the parties' consent and the availability of such persons, appoint one of the following persons to serve as the Mediator.

(1) An independent mediator agreed upon by the parties; or

(2) Another judge to whom the bankruptcy case, contested matter, adversary proceeding, or dispute in such a case or proceeding is not assigned. Should a bankruptcy judge serve as the Mediator in any dispute, TNWB LBR 9019-1 shall not apply and the parties shall comply with the Order Setting Scheduling Conference entered by the Court.

(c) Effects of Mediation on Pending Matters. The assignment of a matter to mediation does not relieve the parties to that matter from complying with any other court orders or applicable provisions of the United States Code, the Bankruptcy Rules, or these Local Rules. Unless otherwise ordered by the Court, the assignment to mediation does not delay or stay discovery, pretrial hearing dates, or trial schedules. Any party may seek such delay or stay, and the court, after notice and hearing, may enter appropriate orders.

(d) The Mediation Conference.

(1) Informal Mediation Discussions. The Mediator shall be entitled to confer with any or all (i) counsel, (ii) pro se parties, (iii) parties represented by counsel, with the permission of counsel to such party, and (iv) other representatives and professionals of the parties, with the permission of a pro se party or counsel to a party, prior to, during or after the commencement of the mediation conference (the "Mediation Process"). The Mediator shall notify all Mediation Participants (as defined in subparagraph (d)(4)(A) below) of the occurrence of such communications, but no advance notice of permission from the other Mediation Participants shall be required. The topic of such discussions may include all matters which the Mediator believes will be beneficial at the mediation conference or the conduct of the Mediation Process, including, without limitation, those matters which will ordinarily be included in a Submission under subparagraph (d)(3) below. All such discussions held shall be subject to the confidentiality requirements of subsection (e) of this Local Rule.

(2) Time and Place of Mediation Conference. After consulting with the parties and their counsel, as appropriate, the Mediator shall schedule a time and place for the mediation conference that is acceptable to the parties and the Mediator. Failing an agreement of the parties on the date and location for the mediation conference, the Mediator shall establish the time and place of the mediation conference on no less than twenty-one (21) days' written notice to all counsel and pro se parties. The mediation conference may be concluded after any number of sessions, all of which shall be considered part of the mediation conference for purposes of this Local Rule.

(3) Submission Materials. Each Mediation Participant (as defined in subparagraph (d)(iv)(A) below) shall submit directly to the Mediator such materials (the "Submission") as are directed by the Mediator after consultation with the Mediation Participants. The Mediator may confer with the Mediation Participants, or such of them as the Mediator determines appropriate, to discuss what materials would be beneficial to include in the Submission, the timing of the Submission, and what portion of such materials, if any, should be provided to the Mediator but not to the other parties. No Mediation Participant shall be required to provide its Submission, or any part thereof, to another party without the consent of the submitting Mediation Participant. The Submission shall not be filed with the court and the court shall not have access to the Submission. A Submission shall ordinarily include an overview of the facts and law, a narrative of the strengths and weaknesses of a party's case, the anticipated cost of litigation, the status of any settlement discussions and the perceived barriers to a negotiated settlement.

(4) Attendance at Mediation Conference.

(A) Persons Required to Attend. Unless excused by the Mediator upon a showing of hardship, or if the Mediator determines that it is consistent with the goals of the mediation to excuse such party, the following persons (the "Mediation Participants") must attend the mediation conference personally:

(i) Natural Persons. Each party that is a natural person;

(ii) Corporation or Other Entity. A party other than a natural person (e.g., a corporation or some other entity or association) satisfies the attendance requirement if represented by one or more persons, other than outside counsel, who have authority to settle and who are knowledgeable about the facts and circumstances of the case and the claims being made.

(iii) Governmental Entity. A unit or agency of government satisfies the attendance requirement if represented by one or more persons who have, to the greatest extent feasible, authority to settle, and who are knowledgeable about the facts of the case, the agency's or unit's position, and the procedures and policies under which the agency or unit decides whether to enter into proposed settlements. If the action is brought by the government on behalf of one or more individuals, at least one such individual shall also attend;

(iv) Other Interested Parties. Other interested parties, such as insurers or indemnitors, whose presence is necessary or beneficial to reaching a full resolution of the matter assigned to mediation, and such attendance shall be governed in all respects by the provisions of this subparagraph (d)(iv); and

(v) Attorneys. The attorney who has primary responsibility for each party's case.

(B) Persons Allowed to Attend. Other interested parties in the bankruptcy case who are not direct parties to the dispute, i.e., representatives of creditors' committees, may be allowed to attend the mediation conference, but only with the prior consent of the Mediator and the Mediation Participants, who will establish the terms, scope, and conditions of such participation. Any such interested party that does participate in the mediation conference will be subject to the confidentiality provisions of this Local Rule and shall be deemed a Mediation Participant.

(C) Failure to Attend. Willful failure of a Mediation Participant to attend any mediation conference, and any other material violation of this Local Rule, may be reported to the court by any party, and may result in the imposition of sanctions by the court. Any such report shall comply with the confidentiality requirement of this Local Rule.

(D) Mediation Conference Procedures. After consultation with the Mediation Participants or their counsel, as appropriate, the Mediator may establish procedures for the mediation conference.

(E) Settlement Prior to Mediation Conference. In the event the parties reach an agreement in principle after the matter has been assigned to mediation, but prior to the mediation conference, the parties shall promptly advise the Mediator in writing. If the parties agree that a settlement in principle has been reached, the mediation conference shall be continued (to a date certain or generally as the Mediator determines) to provide the parties sufficient time to take all steps necessary to finalize the settlement. As soon as practicable, but in no event later than thirty (30) days after the parties report of an agreement in principle, the parties shall confirm to the Mediator that the settlement has been finalized. If the agreement in principle has not been finalized, the mediation conference shall go forward, unless further extended by the Mediator, or by the Court.

(e) Confidentiality of Mediation Proceedings.

(1) Protection of Information Disclosed at Mediation. The Mediator and the Mediation Participants are prohibited from divulging, outside of the mediation, any oral or written information disclosed by the Mediation Participants or by witnesses in the course of the mediation (the "Mediation Communications"). No person, including without limitation, the Mediation Participants and any person who is not a party to the dispute being mediated or the Mediation Process, may rely on or introduce as evidence in any arbitral, judicial, or other proceeding, evidence pertaining to any aspect of the Mediation Communications, including but not limited to: (i) views expressed or suggestions made by a party with respect to a possible settlement of the dispute; (ii) the fact that another party had or had not indicated willingness to accept a proposal for settlement made by the Mediator; (iii) proposals made or views expressed by the Mediator; (iv) statements or admissions made by a party in the course of the mediation; and (v) documents prepared for the purpose of, in the course of, or pursuant to the mediation. 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, mediations, or other alternative dispute resolution procedures shall apply. Information otherwise discoverable or admissible in evidence does not become exempt from discovery, or inadmissible in evidence, merely by being used by a party in the mediation. However, except as set forth in the previous sentence, no person shall seek discovery from any of the Mediation Participants with respect to the Mediation Communications.

(2) Discovery from Mediator. The Mediator shall not be compelled to disclose to the court or to any person outside the mediation conference any of the records, reports, summaries, notes, Mediation Communications, or other documents received or made by the Mediator while serving in such capacity. The Mediator shall not testify or be compelled to testify in regard to the mediation or the Mediation Communications in connection with any arbitral, judicial, or other proceeding. The Mediator shall not be a necessary party in any proceedings relating to the mediation. Nothing contained in this paragraph shall prevent the Mediator from reporting the status, but not the substance, of the mediation effort to the court in writing, from filing a final report as required herein, or from otherwise complying with the obligations set forth in this Local Rule.

(3) Protection of Proprietary Information. The Mediation Participants and the Mediator shall protect proprietary information. Proprietary information should be designated as such by the Mediation Participant seeking such protection, in writing, to all Mediation Participants, prior to any disclosure of such proprietary information. Such designation shall not require the disclosure of the proprietary information, but shall include a description of the type of information for which protection is sought. Any disputes as to the protection of proprietary information may be decided by the court.

(4) Preservation of Privileges. The disclosure by a party of privileged information to the Mediator does not waive or otherwise adversely affect the privileged nature of the information.

(f) Recommendations by Mediator. The Mediator is not required to prepare written comments or recommendations to the parties. The Mediator may present a written settlement recommendation memorandum to parties, or any of them, but not to the court.

(g) Post-Mediation Procedures.

(1) Filings by the Parties. If an agreement in principle for settlement is reached (even if the agreement in principle is subject to the execution of a definitive settlement agreement or court approval) during the mediation conference, one or more of the Mediation Participants shall file a notice of settlement or, where required, a motion seeking court approval of the settlement.

(2) Mediator's Certificate of Completion. After the conclusion of the mediation conference (as determined by the Mediator), the Mediator shall file with the Clerk a certificate ("Certificate of Completion") notifying the court as to whether or not a settlement has been reached. Regardless of the outcome of the Mediation Process, the Mediator shall not provide the court with any details of the substance of the conference or the settlement, if any.

(3) If the Agreement in Principle is Not Completed. If the parties are not able or willing to consummate the agreement in principle that was reached during the mediation conference, the substance of the proposed settlement shall remain confidential and shall not be disclosed to the court by the Mediator or any of the Mediation Participants.

(h) Withdrawal from Mediation. Any matter assigned to mediation under this Local Rule may be withdrawn from mediation by the court at any time. Any Mediation Participant may file a motion seeking authority to withdraw from the mediation or seeking to withdraw any matter assigned to mediation from such mediation.

(i) Termination of Mediation. Upon the filing of a mediator's Certificate of Completion under subparagraph (g)(2) or the entry of an order withdrawing a matter from mediation under subsection (g), the mediation will be deemed terminated and the Mediator excused and relieved from further responsibilities in the matter without further order. If the Mediation Process does not result in a resolution of all of the disputes in the assigned matter, the matter shall proceed to trial or hearing. However, the court may, upon the consent of the parties, reinstitute the Mediation Process if the judge determines that such action is the most appropriate course under the circumstances. In such event, this Local Rule shall apply in the same manner as if the mediation were first beginning pursuant to this Rule.

(j) Applicability of Local Rules to a Particular Mediation. The court may, upon request of one or more parties to the mediation, or on the judge's own motion, declare that one or more of provisions of this Local Rule may be suspended or rendered inapplicable with respect to a particular mediation except subsections (e) and (k). Otherwise, this Local Rule shall control any mediation related to a case under the Bankruptcy Code.

(k) Immunity. Aside from proof of actual fraud or other willful misconduct, Mediators shall be immune from claims arising out of acts or omissions incident or related to their service as mediators appointed by the bankruptcy court. See Wagshal v. Foster, 28 F.3d. 1249 (D.C. Cir. 1994). Appointed Mediators are judicial officers clothed with the same immunities as judges and to the same extent set forth in Title 28 of the United States Code.