Confidentiality, Wherefore Art Thou? (It Matters)

The power and privilege of being able to have truly confidential conversations in mediation in a digital world where every thought, however well or poorly considered, can and is often instantly shared on some electronic public form cannot be overstated.

Mediation participants have a hard time even understanding, much less embracing, the idea that they can speak freely in mediation without fear of an appearance on “CSI.”

The reluctance is understandable. As stated by the U.S. Supreme Court in its seminal decision finding a privilege between psychiatrist and patient, the notion of confidentiality runs contrary to the cornerstone of adversarial dispute resolution:

The common-law principles underlying the recognition of testimonial privileges can be stated simply. “‘For more than three centuries it has now been recognized as a fundamental maxim that the public … has a right to every man’s evidence.’” Jaffee v. Redmond, 518 U.S. (1996).

Notwithstanding that “fundamental maxim,” the Supreme Court found in that seminal decision a public policy under Federal Rule of Evidence 501 favoring the care of a psychiatric patient over the rights of someone later injured by that person.

In an apparent attempt to keep the judiciary out of the business of deciding public policy regarding privileged communications, the Georgia Legislature has enumerated the communications deemed private, including between psychiatrist and patient, in O.C.G.A. § 245501.

In Georgia, the Legislature has taken two broad approaches to create true confidentiality in mediations: one modeled after Federal Evidence Rule 408, another modeled after Rule 501.

The first came with the revision of the Georgia Evidence Code in 2013 which, like its federal rule counterpart, established a basic exclusionary privilege: “Evidence of conduct or statements made in compromise negotiations or mediation shall not be admissible.” O.C.G.A. § 244408(b).

Prior to 2013, O.C.G.A. §24337 provided the only statutory privilege to “Admissions obtained by constraint, by fraud, by drunkenness … or propositions made with a view to compromise.”

The second came in 2021 with the adoption of the Uniform Mediation Act. O.C.G.A. § 9173 (preventing nonconsensual disclosure and the ability to prohibit disclosure by others of mediation communications) and O.C.G.A. § 9176 (“No, Judge, don’t ask what happened.).

Notwithstanding the statutory exceptions and preclusions to mediation confidentiality provided in O.C.G.A. § 9174 and O.C.G.A. § 9175, when considered with O.C.G.A. § 244408(b), Georgia has therefore created a comprehensive framework to protect the confidentiality of mediation communications except when expressly waived or as to threats of violence, in furtherance of criminal activity or if judicially determined to be the only source of critical evidence.

The news from other states is more mixed. In addition to Georgia, 12 jurisdictions (Hawaii, Idaho, South Dakota, Vermont, Utah, Ohio, Washington, New Jersey, Iowa, Illinois, Nebraska and the District of Columbia) have adopted a version of the Uniform Mediation Act.

Other jurisdictions have legislation that only provides a testamentary privilege similar to Federal Rule 408 (New York), or have adopted legislation other than the UMA that provides for some version of mediation confidentiality (Delaware, Florida, Montana, California, Virginia, Montana, Nevada, Oregon) that include unique exceptions and possible penalties for violation (Florida).

The confidentiality smorgasbord is no less uniform in federal districts. In 1998, Congress enacted the Federal ADR Act mandating that all district courts make some form of ADR available to litigants.

Mediation participants have a hard time even understanding, much less embracing, the idea that they can speak freely in mediation without fear of an appearance on “CSI.” The reluctance is understandable.

Recognizing that confidentiality is critical to these processes, the act provided that “each district court shall, by local rule … provide for the confidentiality of the alternative dispute resolution processes and to prohibit disclosure of confidential dispute resolution communications. 28 U.S.C.A. § 652. Even in Georgia’s three federal districts, however, those rules vary considerably.

NDGA LR 16.7.I.(5) requires a signed agreement among participants that mediation communications cannot be introduced in evidence. SDGA LR 16.7.8 makes mediation communications “confidential” and precludes disclosure to a judge “while the case is pending.” MDGA LR 16 encourages parties to “consider” mediation at their own expense but also, in LR 10 cautions parties and counsel not to hold out “false hope” of settlement that would delay litigation.

What law governs a mediation and mediation confidentiality is therefore important, especially in the postpan demic era of Zoom mediations that may be conducted in numerous jurisdictions simultaneously.

A 2017 case from the U.S. Court of Appeals for the Tenth Circuit demonstrated how problematic the application of choice of law principals can be in multijurisdictional mediation. Larson v. Larson, 687 Fed. Appx. 695 (10th Cir. 2017) involved a family fight over property in a trust that was mediated and settled in Colorado as documented in a “term sheet.”

When the parties could not agree on a full settlement agreement, litigation was commenced in Wyoming to interpret and enforce competing interpretations of that document. In order to “prove” the intent of the parties under the term sheet, one party sought to introduce into evidence a PowerPoint presentation used in the mediation. Colorado law would have precluded admission of the evidence, Wyoming law would permit it.

The district court magistrate applied Wyoming choice of law principals, found that the mediation agreement signed by all parties violated Wyoming public policy and admitted the PowerPoint into evidence. The mediation agreement provided that “[a]ll communications, whether oral or written, made in the course of the mediation process are confidential by this agreement and the Colorado Dispute Resolution Act.”

The Tenth Circuit affirmed.

The Tenth Circuit opinion in Larson is hardly precedential. West declined to include the decision in the Federal Reporter. In its decision the court noted that it reviewed the case under an abuse of discretion standard.

Finally the court (somehow) found both that consideration of the PowerPoint did not prejudice the objecting party and that “its exclusion would not have [led] the district court to reach a contrary result.”

Larson is nevertheless instructive in two respects. First, the court observed that in diversity jurisdiction cases state law governs privilege issues. Second, because Wyoming follows the Restatement (Second) of Conflict of Laws, it quoted Section 187 of that treatise, which requires application of the law chosen by the parties unless that choice violates a public policy of the forum state.

Although the Tenth Circuit declined to disturb the magistrate’s finding that an exclusion from evidence of a confidential mediation communication violated Wyoming public policy, it was at least a significant hurdle that had to be cleared in the court’s questionable reasoning.

The choice of state law applicable in a mediation can therefore be critically important, both in conflict analysis and substantive rights of confidentiality in mediation. Parties to a mediation with a Georgia nexus, either through the mediator, situs of litigation or location of parties, should strongly consider including an express choice of Georgia’s broad mediation confidentiality law in their written agreement to mediate.

Larson demonstrates that there can be no guarantee that a determined court might ignore the choice of the parties but the right to conduct confidential mediation negotiations at least deserves a fighting chance.

NISBET “KEN” KENDRICK is a neutral with Henning Mediation, having worked in ADR since 1994, when he co-founded the Alternate Dispute Section of the State Bar of Georgia. He practiced for 35 years as a trial lawyer, ending in 2010 with Womble Carlyle Sandridge & Rice to focus on full-time practice mediation and arbitration.