mediation gap order

7/27/2019 Mediation Gap Order

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UNITEDSTATESDISTRICTCOURT

SOUTHERNDISTRICTOFFLORIDA

MIAMIDIVISION

CASENO.1224356CIVGOODMAN

[CONSENTCASE]

PROCAPSS.A.,

Plaintiff,

v.

PATHEONINC.,

Defendant.

_______________________________/

ORDERDENYINGPLAINTIFFPROCAPSMOTIONTOSTRIKE

(ANDFOROTHERRELIEF)

ThisCause isbefore theUndersigned on Plaintiff Procaps, S.A.s (Procaps)

Motion to StrikeDefendantsOpposition to PlaintiffsMotion to Compel Return to

Mediation andMotion for Sanctions against Patheon and its Counsel for Violating

Mediation Rules (the Motion). [ECF No. 592]. Having considered the Motion,

DefendantPatheonsResponse [ECFNo.599],ProcapsReply [ECFNo.601],and the

pertinentportionsoftherecord(includingtheoffendingsubmission[ECFNo.587]),

theUndersigneddeniestheMotionforthefollowingreasons.

OnAugust18,2014,ProcapsfiledaMotiontoCompelReturntoMediation[ECF

No.572],whichPatheonopposed.InPatheonsopposition[ECFNo.587],itresolutely

objected to a return tomediation,making several strong statements that called into

question theabilityof theparties tocompromise in thiscase,at timesalluding to the

Case 1:12-cv-24356-JG Document 608 Entered on FLSD Docket 10/22/2014 Page 1 of 6


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previousmediation thathadoccurred.Procaps contends that six specific instances in

thatoppositionviolatetheconfidentialityinherentinmediationsessions:

statements that (1) there was a monumental gap at mediation; (2)

Procaps refused to close the gap during or after mediation with a

reasonable settlement; (3) Procaps made an overthetop settlement

offer atmediation based on Patheons revenues; (4) Patheonmade a

counteroffer to Procaps settlement offer from the mediation; (5)

Procaps refused todisclose a rule of reason theory toPatheon; and (6)

Procapscounselmadenoeffort toconfer ingood faithaboutmediation

andsettlement.

[ECFNo.592,p.2].Giventheseallegedviolationsofmediationconfidentiality,1Procaps

argues that Patheons entire pleading should be stricken by the Court. [Id.]. This

argumentisnotconvincing.

Itis,ofcourse,absolutelytruethatPatheonmadethestatementsattributedtoit

byProcaps,asthesecondtolastparagraphoftheresponsealonefeaturesarundownof

almost every allegedlyoffending statement in controversy in a single sentence. [ECF

No.587,p.4].However,almostallofthechallengeddisclosuresareinnocuousandnot

violativeoftheconfidentialityrule.

ThefirststatementthatProcapschallengesisPatheonscontentionthattherewas

amonumentalgapat the initialmediation. [ECFNo.592,p.2].Morevoer,Procaps

alsoargues

that

Patheons

contention

that

Procaps

refused

to

close

the

gap

during

or

1 LocalRule16.2(g)(2)states inpertinentpart:Allproceedingsof themediation

shallbe confidentialandareprivileged inall respectsasprovidedunder federal law

andFloridaStatutes44.405.Theproceedingsmaynotbe reported, recorded,placed

intoevidence,madeknown to theCourtorjuryor construed foranypurpose asan

admissionagainstinterest.



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aftermediationwithareasonablesettlementisalsoproblematic.[Id.].TheUndersigned

disagrees. The motion that Patheon was responding to when making these two

statementswasaMotion toCompelReturn toMediation.Itstands toreason thatany

argument thatopposesa return to saidmediationwouldmention at least to some

limited degree the fact that the previous mediation did not succeed because of

substantialdifferences.

The fact thata settlementwasnot reachedat themediation is indicativeofan

impasse;the

permeability

of

that

impasse

is

amajor

factor

that

the

Court

would

consider indecidingwhether itwas appropriate to order a followupmediation.As

such,Patheonsuseofgeneralizedtermstodescribethebreadthofthegapbetweenthe

partiespositionsandPatheonsimpressionofProcapswillingnesstobridgethedivide

does not disclose confidential details and is sufficiently generic to not constitute a

violationof the confidentiality rule.Further,Patheons assessmentsofProcapsgood

faitheffortsatcompromisealsofitunderthisumbrella,asdoesthefactthattheparties

couldnot successfully exchange offers outside the context ofmediationwhile in the

runup to theMotion to Compel Return toMediation. [ECF No. 587, p. 3]. These

statementsare responsive to theMotionbeingaddressedand theUndersignedviews

themasbeingrelativelyharmless.

TheCourtdoes,however,agree thatcertainstatementsmadebyPatheon in its

oppositiontotheMotiontoCompelReturntoMediationdidinfactgoatadtoofarin



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describing specificpositionsofProcapsduring themediation and in the allusions to

subject matter arising during the mediation, but these technical violations do not

constitutesuchasevereabuseofthetrustinmediationastowarrantthesevereremedy

ofstrikinganentirepleadingthough.

Tobesure,Patheoncouldhaveeasilymadeitspointbysimplystatingtherewas

a monumental gap that the opposing party refused to close and leaving it there,

ratherthanaddinginProcapsexactdemand.[ECFNo.587,p.4(Procapsoverthetop

settlementdemand

is

based

on

its

experts

flawed

opinion

that

the

Collaboration

would

havegenerated$1billioninrevenues...)].Theinclusionofthisspecificinformationin

theresponseto themediationmotion is inappropriatebecauseoftheadditionaldetail

(modest as it may have been) that it includes. Further, Patheons statement that

Procapshasno ruleof reason theory, as evidencedby its refusal todiscloseone to

Patheon, is also an unnecessary and inappropriate disclosure of mediation

communications.2[Id.].

Nevertheless, despite Patheons technical violations, Procaps suggested

remediesaredisproportionate.Procapsarguesprimarilyinfavorofstrikingtheentire

pleading [ECFNo. 592, pp. 25],while also suggesting a lesser penalty of allowing

2 In certain contexts, such as solely in relation to Local Rule 7.1s mandatory

conferral process, Patheons reference, in a court submission, to the rule of reason

theorymaybepermittedandmayinfactberelevanttothemotionincontroversy,but

Patheons reference to it here transparently alludes to specific positions taken by

Procapsintheactualmediationsession.



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Procapstoalsodiscloseconfidentialcommunicationsfromthemediation.[Id.atpp.5

6].TheUndersigneddoesnotfavoreitherofthesepenalties.

Aspreviouslymentioned,theCourtdoesnotconsidermostofPatheonsalleged

transgressionsofthemediationprivilege toactuallybeviolations.Asidefromthetwo

specific instances detailed above, Patheonwas appropriately responsive to Procaps

motionwhen itprovided general characterizations of the firstmediationprocess (as

well as of the LocalRule 7.1 conferral process leadingup to theMotion toCompel

Mediation)as

evidence

of

why

it

opposed

anew

round

of

mediation.

While

the

Court

certainly does not look favorably upon Patheons few excessive disclosures, the

Undersigneddoesnotviewthemassignificantenoughtochillmediation,asProcaps

argues[ECFNo592,p.3(citingRodriguezv.MarbleCareIntl,Inc.,863F.Supp.2d1168

(S.D.Fla.2012)],andthustowarranttheextremesanctionofstriking.

Procaps lesserincluded sanction of a followup violation of the mediation

privilegeisalsoinappropriateunderthesecircumstances.WhileProcapsmaybeunder

theimpressionthat itisnecessaryforit toviolate theconfidentialityruleandofferits

owntakeonthespecificsthatPatheoninappropriatelydisclosed[ECFNo.392,pp.56],

such an action is also inappropriate.TheUndersigned is extremely familiarwith the

factsand issuesunderlying thiscase therearenowmore than600docketentries in

thislawsuitthatbeganinDecemberof2012 andmyperceptionofthecasewillnotbe

influencedby the few, isolated statementswhichwere slightly overthetopbecause



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theyprovidedabittoomuchdetailaboutthemediation.Bothpartiesarenowonnotice

tonotrevealanyfurtherconfidentialmediationcommunications.

Accordingly, Procaps Motion to Strike Defendants Opposition to Plaintiffs

MotiontoCompelReturntoMediationandMotionforSanctionsagainstPatheonand

itsCounselforViolatingMediationRulesisdenied.

DONEANDORDEREDinChambers,inMiami,Florida,October22,2014.

Copiesfurnishedto:

AllCounselofRecord

JohnBarkett,SpecialMaster


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