As part of this blog, my goal is to provide both lawyers and non-lawyers with some valuable lessons I have learned throughout my career. There are many professions, careers and industries; however, everyone is in the business of people. The practice of Negotiating From The Middle can be effectively used in most situations to bring parties together. 

Major Deals

This week I handled two major contract negotiations with a leading beverage company and a major sports league this week. Both agreements were intellectual property licensing deals, but the similarities stop there.  It was very refreshing to speak with two lawyers, handling very different contract types, who truly utilize the principle of Negotiating From The Middle. My definition of this concept is making your initial position a reasonable one that both parties should be able to accept, yet is not detrimental to you or your client. Too many times negotiations begin with a one sided draft or position, which taints the remainder of the discussions. Don’t put yourself in that situation.  

Determining Your Initial Position

For years, my mentor has constantly drilled a process of developing your best starting point into my head. In determining your position (for any situation), he continues to remind me 1) Evaluate the risk of the relationship 2) Think about worst case scenarios and, then 3) reasonably determine your initial position that allows you to Negotiate from the Middle. Countless hours of research have shown that an agreement can be reached much easier and quicker if you turn your fallback positions into your initial position. 

Starting Point

Approximately 75% of my contract practice utilizes some part of a form agreement. What I have found is that when the initial forms used are fair to both sides, there is little (if anything) to negotiate. One of the largest and most complex deals I worked on (over $50 million) went smoother than some of the minor deals I see each day, because both sides started Negotiating From The Middle. 

When to Hold Firm

Of course, there are some issues that are very difficult to retreat away from. I often refer to tem as “deal killers.” Be careful with that characterization, as many items initially considered “deal killers” may not be critical to the deal. During my career, those issues generally revolve around the “3 I’s” -insurance, indemnification and intellectual property.  Most seasoned lawyers understand these concepts and the reasons they are sometimes one sided. Take some time to identify your critical issues, then fully grasp before you begin a negotiation and you will save yourself many headaches.

Getting to Yes

If I were giving advice to any new lawyer, it would be to perfect the fine art of when to dig in and when to let an issue go. Some call it posturing, good lawyer/bad lawyer, bulldogging or just plain being difficult.  I am still working on this aspect of my negotiating skills and my personality does not help. Being aggressive is just my nature. I play to win or I don’t play. Keeping this advice in mind, you must determine when a “lay up shot” is better than “going for the green.” Taking a more passive approach to contract negotiations is by no means retreating or settling for a weaker position.  

Negotiating From The Middle generally produces better results than taking a hard line, one –sided, overly aggressive or obstinate position. Try it out in your next negotiation and see how great your results can be!