When Mediation Involves The Public’s Interest, How Confidential Is The Mediation Under Federal Law?
On July 6, 2012, Steven Church reported in Bloomerg, “[t]he judge overseeing Stockton, California’s bankruptcy limited the amount of information the city and its creditors can make public about a months-long mediation process that failed.” Mediation is required under California law before a city can file for bankruptcy. Mr. Church reports that Bankruptcy Judge Christopher Klein ruled that the City’s offer can eventually be made public, but that counter-offers remain confidential. Interestingly, the City asked for release of the information, while bondholders asked for the release of some of the information.
The issue is noteworthy to us, because the confidentiality of mediation-related matters is somewhat unsettled under federal law, though the privilege is strong under California law (Cal. Evid. Code 1119). Thus, we have posted about Facebook, Inc. v. Pacific Northwest Software, Inc, 640 F.3d 1034 (9th Cir. 2011), in which the Court of Appeals Court expressed doubt that the federal district court Local Rules applying to ADR could create a “privilege” for confidential communications in a mediation, because privileges are created by the Federal Rules of Evidence, which rules cannot be overruled by Local Rules. See also Phyllis G. Pollock, Mediation Confidentiality: A Federal Court Oxymoron, The Resolver 8, available at http://www.pgpmediation.com/blog/wp-content/uploads/2009/08/mediation-confidentiality-a-federal-court-oxymoron31.pdf (urging adoption by the states of the Uniform Mediation Act to create consistency and provide “a framework for the federal courts,” and urging codification of a federal mediation privilege); Joseph Lipps, The Path Toward A Federal Mediation Privilege: Approaches Toward Creating Consistency for a Mediation Privilege in Federal Courts (google the title to find the article).
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