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MEDIATION What is it, and what can I expect?

MEDIATION
What is it, and what can I expect?

Alternative Dispute Resolution:
Approximately 50 years ago, lawyers and other professionals involved in the resolution of disputes began to look at alternatives to traditional methods of resolving those disputes, such as litigation in the courts or before administrative tribunals. They developed a catch phrase to describe these methods which they called Alternative Dispute Resolution (ADR). The most popular of these alternatives has been Mediation. The attorneys at HammondTownsend have considerable experience with mediating cases, and it is the firm’s policy to recommend mediation to our clients in most cases. However, because we are familiar with the terms used in mediation and have been through the process many times ourselves, we sometimes assume a degree of familiarity with the mediation process on our client’s part which you do not have. For most of you, the mediation, which your attorney has recommended, will be your first and only exposure to the mediation process. This handout is intended to help explain the mediation process to you, answer questions you might have about mediation, either in general or as it relates to your claim, and to ease your concerns so that you can participate fully in the process with your attorney and get the best results from the decision to mediate through the (hereafter “the Commission). The Commission began offering ADR services, including, to its litigants in 2012, during which year 213 cases were submitted to the Commission’s ADR section. By 2016, the number of cases heard by the ADR section had increased to 1,654, and the quarterly statistics for 2017 showed additional increases when compared to the same quarter in 2016 (1st Q 2017 up 34% over the same quarter in 2016, and 2nd Q cases up 55% over the same quarter from the year before). We mention these statistics because they show an increasing willingness for all parties involved in workers’ comp disputes, claimants, employers, and insurance carriers, to give mediation a try as a quicker and less costly (from both a monetary and a personal energy perspective) alternative to traditional litigation.

Voluntary Consent to Mediation

If you do not remember anything else from reading this information, you should always keep in mind that the Commission cannot force you to mediate. ALL MEDIATION BEFORE THE COMMISSION IS VOLUNTARY AND CAN ONLY OCCUR WHEN ALL PARTIES AGREE TO PARTICIPATE. This requirement that all parties agree to mediation gives you, the claimant, a “trump card” to play at any time in the mediation process. If you and your attorney conclude that further participation in the mediation process would not be beneficial to your case, you have the absolute right to withdraw your consent to the mediation and decline to go any further in that process. Since the consent of all the parties is required under the Commission’s rules, if you withdraw your consent, the Commission’s mediator will have to stop the mediation. In other words, nothing can be done in the mediation unless you agree with the action which is proposed. This is a powerful option, and should only be used in the most serious circumstances, and never used without first consulting with your attorney who can advise you on the consequences of taking this action.
Remember also that everything we have mentioned as far as your consent to the process being required applies equally to the other side. Just as you have the right to withdraw your consent to mediation, so too does the employer and its insurance carrier. When we inform the Commission that our clients are agreeable to mediation, it is a good-faith commitment on our part to participate in the process with an open mind. We want the other side to demonstrate good faith as well, and that sometimes means we have to be prepared for some periods when it does not look like the mediation is going to produce anything like a positive resolution of your claim. However, we would not expect the other side to get up and walk out just because we mentioned something during the mediation with which the other side disagreed. Likewise, we need to be patient and prepared to let the process to play out, and not be overly disappointed when the other side appears to be talking down to the mediator about your case and/or seems to be deliberately undervaluing it.

The Mediator: Who Mediates These Cases and the Role of the Mediator
Who is the mediator and what does the mediator do? The Commission’s judicial branch is made up of three “full” Commissioners and a larger number of Deputy Commissioners. The three Commissioners act somewhat like an appellate court in that they review the decisions which the Deputy Commissioners (DC’s)make after the DC’s conduct evidentiary hearings with the parties. Think of the DC’s like district trial judges. The DC’s conduct the initial hearings on cases brought by the litigants and make rulings on the admissibility of evidence. They are the initial fact finders where the evidence is disputed, and make the initial decisions on which party has successfully presented its case and which has failed to carry its burden of proof on the issues before them. Several of these Deputy Commissioners are also trained as mediators, and the Commission makes them available to mediate those cases in which the parties have agreed to participate in mediation. The Commission does not charge for the services of the DC’s who serve as mediators (which is a “huge” plus for workers’ comp claimants considering that private mediators charge by the hour with rates of $500/hour or more not being uncommon.)
While the DC’s bring plenty of experience from their judicial roles to the mediation process, the role of the mediator is quite different from that of the judge at a hearing. While neutrality is called for in both roles, when presiding over hearings, the DC necessarily makes decisions on disputed issues which end up favoring one side or the other. In a mediation, the mediator remains neutral throughout the entire process. The mediator’s primary responsibility is to facilitate a discussion between the parties to make sure that each side is aware of and has considered the strengths of the opponent’s case and the weaknesses in that party’s own case, all without making a decision or judgment regarding the merits of the claim or the likely outcome of that issue if it were to arise during the course of a hearing in this case. The mediator may assist the parties and/or their attorneys to assess the strengths and weaknesses of their case; however, the mediator will not tell the parties what to do or suggest that a particular outcome is more probable than another. The term used for the mediator’s role as described is the “facilitative approach.”

The DC’s who act as mediators are also generally prepared to offer a non-binding evaluation of the claimant’s claim which they will share with the parties, but only if requested to do so by both sides. If one party requests that the mediator share his/her evaluation, the mediator will, with consent of the opponent, disclose the evaluation to both sides. In our experience, it is best for the mediator to attempt to get the case settled through the facilitative approach first by giving the parties an adequate opportunity to resolve the case in a settlement range which originates from within the parties’ own calculations. Our experience is that once the mediator gives an evaluation of the claim, the side which is closest to that evaluation in its own numbers tends to stick close to those numbers. If the mediator’s evaluation falls closer to the claimant’s evaluation, the claimant feels justified in his/her own numbers and is resistant to go below the mediator’s suggested evaluation. By contrast, if the mediator’s evaluation is closer to the employer’s last offer to settle, the employer feels justified in its negotiating position and will only grudgingly make any higher offers. (A federal magistrate judge once said during a mediation in an accident case which was scheduled to be tried in the federal district court, which involved one of our attorneys, “The party that moves to the ‘real numbers’ first, controls the mediation.” By “real numbers” the magistrate judge meant numbers reflecting a realistic settlement possibility, and which reflected a realistic assessment of the case’s value.) Getting affirmation from the mediator that your bargaining position is justified because it closely resembles the mediator’s own thinking is a powerful incentive to concluding that you are in “real-number” territory. Consequently, if the revelation of the value which the mediator places on the claim comes too soon in the process, it is likely to bring a halt to the good-faith exchange of demands and offers between the parties and may even cause the mediation to end prematurely without a final resolution. By contrast, if the parties have been exchanging numbers reflective of their own values which they have placed on the claim, and relatively late in the process when the parties seem to have reached a deadlock, the mediator expresses an opinion on value, with the caution that the evaluation is only the mediator’s personal opinion, and is not binding on any party, the mediator’s expression of valuation may spur one side or the other, or even both sides to be more realistic in their own evaluations.

• The Mediation Process: Who goes where and says what?
Initial proceedings: All mediations are unique in that no two follow exactly the same script, but there is an overall model for these mediations which the DC’s tend to follow. At the beginning, the mediator will call all parties together in the same room. In addition to the mediator, you as the claimant will be present with your attorney. You may also have present your significant other, such as your spouse, finance(e), girlfriend, boyfriend, parent, etc. The defendants will be represented by an attorney and must have someone who is authorized to settle the case present as well, even if it is only by telephone. When all the parties are present in the same room at the same time, this is called a “plenary” session. The mediator will begin with some opening remarks, during which the mediator will go over some rules for the mediation, such as reminding everyone present that the mediation is voluntary. (See the discussion above about the voluntary nature of mediations before the Commission.) The mediator will also advise everyone present that mediations before the Commission are confidential. Nothing which is discussed during the course of the mediation may be used by either side in the disposition of the claim. Even any notes taken during the mediation are supposed to be turned in to the mediator or destroyed at the end of the session.
Opening Statements: Once the rules have been laid out by the mediator and agreed to by everyone who is present, each person will be given an opportunity to make an opening statement. Your attorney will make the initial opening statement for you. Don’t expect your attorney to make a “fire-and-brimstone” speech or anticipate that your attorney will speak aggressively to opposing counsel enumerating all the reasons the Commission should decide your case in your favor. There is a time and a place for such statements, but mediation is neither that time nor place. Instead, expect your attorney to be more low-key. While your attorney may discuss some of the strengths of your claim, the tone of the statement will be more reasoned. Do expect your attorney to thank the opponents for agreeing to give mediation a chance to work. You should also expect your attorney to make a promise on your behalf that you will keep an open mind throughout the mediation, that you will consider everything the other side has to say and that you will remain reasonable about the possibilities of settling your claim through mediation. After having made those promises on your behalf, your attorney will tell the opponent that your side will expect the same reasonable and open-minded approach to mediation from them. As you can see, the attitude at mediation is less confrontational and less adversarial than the rhetoric used in litigation.
Next, you will be afforded the opportunity to make your own statement. Many of our clients tell us that they will be too nervous to say anything, or that they will leave the opening statement to their attorney. In our opinion, the client should always make his/her own statement, and failing to do so is a wasted opportunity to address directly the decision-maker on the other side. This is your chance to tell the insurance claims adjustor, or the corporate officer of your employer directly what this accident and the resulting injuries have done to your life. You can say things in mediation that would not be permitted in a hearing. For example, you can tell the other side about the pain you feel constantly, the things you used to enjoy doing that you can no longer do, or the family moments that you either had to miss because your injuries would not let you be there or which were so painful that you could not appreciate them fully. While in workers’ comp you are not entitled to compensation for pain and suffering, aggravation, or inconvenience, your sincere statement as to how the accident has changed your life often has an effect on the human being who makes the decisions for the other side. Please remember that you are not addressing your remarks primarily to the mediator since the mediator cannot make the other side do anything to settle your case. Instead speak directly to the decision maker for the employer (or insurance company) even if he/she is only a voice on the telephone.
While your significant other would probably not be given an opportunity to speak at a formal hearing (unless she/he was called as a witness, in which case she/he would be restricted to answering questions from the attorneys), statements by significant others are not only permitted in a mediation, but are generally encouraged by the mediator to give the mediator (and perhaps the opponent) some sense of the role the significant other may play in your relationship. Depending on the nature of your relationship with your significant other, he/she may see your efforts to deal effectively with your injuries from a different perspective than you do. While the significant other should not simply repeat everything you say in your own statement, he/she should concentrate on those elements of your life post-accident on which he/she has a unique viewpoint. If your significant other has had to make major adjustments in his/her daily life to assist you in trying to cope with your accident and the resulting injuries, this is his/her opportunity to tell the other side that the fallout from your accident has touched not only you, but others as well. If you or your significant other are unsure about what to say or about making a statement at all, you should discuss it with your attorney well before the mediation so that you are prepared to speak when called upon by the mediator.
The opponent will also be afforded an opportunity to make an opening statement. Expect that statement to be brief and generally in keeping with the non-confrontational tone adopted by your attorney. Somewhere in his/her opening statement, the defense attorney will say that the defendants regret that you have had an accident and that you feel that you have been injured as a result. Defense counsel may apologize to you for the employer’s lack of pre-accident attention it gave to the work condition that led to your accident. Some defense attorneys think that an apology is a confession of responsibility on the part of the employer, however, so not all defense attorneys and not all employer’s representatives will come right out and apologize. If the lack of an apology is a significant matter to you, tell your attorney before the mediation begins. Your attorney may be able to discuss your feelings about a direct apology with opposing counsel before the mediation starts, and opposing counsel may choose to include an apology in the opening remarks.
At some point in their opening statements most defense attorneys tell the claimant that their approach to settling this case is that it is a business matter for them. (To quote from the Michael Corleone character, played by Al Pacino, in the Godfather movies, “It’s not personal; it’s business.”) What they intend to convey by claiming that their response to your settlement proposals are guided by business rules is that, while they are sympathetic, they believe that their client only has limited exposure to being ordered to pay benefits by the Commission. Therefore, they are not going to pay more than they think their exposure will be should your case be litigated before the Commission. As your attorneys, it is our job to find out what the maximum amount the defendants are willing to pay on that day to avoid having to litigate the case, unless you have agreed to settle before the issue of the defense’s limit of authority is raised. Once we have discovered their top figure, your options are fairly clear: accept their top-dollar offer or turn the offer down and proceed to litigation.
As you listen to the opening statements made by the defense, you should not make any response either by word or gesture to what the defendants say. You should most especially not interrupt another party when that party is making an opening statement. Try your best to listen to what the opponent is saying objectively. Often the defendant’s statement gives you and your attorney clues to how to respond to the defense’s arguments against compensating you. Be under control and avoid rolling your eyes, shaking your head, or whispering to your attorney or significant other while the opponent is speaking. You expect them to listen politely to what you have to say; they are entitled to nothing less from you.

• Caucuses and the Exchange of Demands and Offers:

Once the opening statements have been completed, the mediator will separate the parties in different rooms. This physical separation allows the mediator to “caucus” with each side in confidence. By alternately visiting with one side and then the other, the mediator becomes the essential go-between for the parties. Information revealed to the mediator by one side remains confidential with the mediator, and he/she cannot repeat that information to the other side without permission. The mediator assumes the role of neutral facilitator making sure that the parties are each aware of the weaknesses in their case as well as the strengths of the opponent’s case. Also, the mediator takes on the role of messenger transmitting the claimant’s demand for settlement (a dollar amount which the claimant asks for is called a “demand” while a dollar figure suggested by the defense is called an “offer.”), and returning with an offer made by the employer. Your attorney will advise you as to the demands you should make in response to the offers made by the defendants.
Certain “rules” apply in these types of settlement discussions. If you authorize your attorney to make a specific demand, you are implicitly saying that if the other side agrees to pay that figure, you will accept it, and the case will be settled. In most negotiations the claimant’s demands go down, while the defendants’ offers go up. Unless you and your attorney have discovered a new fact that would cause the value of your claim to increase dramatically, you will not be considered to be negotiating in good faith if you reverse course and attempt to increase your demand instead of decreasing it. Also, since benefits pursuant to the Virginia Workers’ Compensation Act are spelled out with some specificity and for a limited list of factors, your demands need to be based on the availability of damages for the reason you are claiming under the Act. In other words, you should not make a demand on the sole theory that it sounds like the amount of money you will need to live on for the remainder of your work life or that the amount “just feels right.”
Types of Benefits (Damages) Available in Workers’ Compensation: Deputy Commissioner Bill Culbreth, who hears cases in the Valley (Harrisonburg and Staunton) is also a mediator for the Commission. As a mediator, he often reminds the parties that, in workers’ comp, there are essentially two “pots of money,” medical expenses and indemnity benefits for lost time and income at work. The claimant should be able to show how he/she can justify his/her demand by referring to these two “pots.” Your attorney will guide you as to how much to demand initially and how much to reduce your demand in response to a corresponding offer from the employer. The Commission’s mediators have begun to require that the parties exchange at least one round of demands and offers prior to the date of the mediation. Since the initial demand is often considered to be unrealistically high and the employer’s initial offer is often considered insultingly low, the mediators apparently hope that these extreme positions can be eliminated early on by this preliminary exchange.
Negotiations and strategies: At some point in most of the mediations this firm has handled, our client has turned to us and said that we are going down in our demands by larger amounts than the defense is coming up. Nothing to in the mediation process requires the parties to make equal moves in their negotiations. If that were the case, the entire mediation process could be essentially eliminated because it is a mathematical certainty that if the parties make equal reciprocal moves in their demands/offers, that they will arrive at the number which is exactly halfway between the initial demand and the corresponding initial offer. We have found through our experience with these mediations that certain numbers represent psychological barriers to the other side. Consequently, your attorney may suggest that you make a disproportionate move in order to clear one of those psychological barriers and to signal that you are negotiating in good faith with the intention of getting this case resolved. Your attorney will also be sensitive to barriers that the defense is willing to cross, and he/she will advise you when the other side crosses such a barrier and what your attorney thinks that move may mean for your case.
There may come a time when one of the parties suggests that the two sides split the difference in their negotiating positions. This strategy is called “bracketing” or a “straddle.” It usually results from one party’s deliberate effort to position itself so as to have the opportunity to make the proposed split. When a party wants to employ the bracketing technique, that party first positions his/herself by consciously adjusting his/her negotiations so that that party and the opposing party are equidistant from the target number. For example, the claimant’s attorney maneuvers his demands so that the claimant’s last demand was $150,000. The defense makes a new offer of $75,000, as the claimant’s attorney anticipated. The claimant’s attorney then proposes that 1) his client either will reduce the demand to $140,000, or 2) that the claimant will reduce its demand to $130,000 if the defense will increase their offer to $95,000, in an effort to “bracket” the target amount, or 3) that the claimant will drop to $125,000 leaving the parties straddling the target number, in this case $100,000. Claimant’s attorney then offers to split the difference.
From the discussion above, you may have concluded that, despite our earlier statement that the claimant must be able to justify his/her demand by reference to the statutory sources of benefits available in comp cases and our later statement that demands should not be based on what sounds like the right number, that mediations do come down to a numbers game. Without sounding too cynical, that conclusion is generally correct. In any mediation that lasts more than a couple of rounds of exchanging strengths and weaknesses of the respective parties’ cases, the parties’ positions are usually established with some detail. Consequently, in later rounds where the parties are closing in on an agreement, when the mediator caucuses with one side or the other, the mediator will merely be carrying figures for new offers and demands back and forth between the parties. By this time, hopefully, both sides have gotten to the “real numbers.” In this circumstance, your attorney will be concentrating on either getting an offer from the defendants which you can accept or determining the maximum offer the defense is prepared to make at this time. If the parties seem to be locking into their final positions and they are still some ways apart, the mediator may ask to speak with the attorneys alone. You should not read too much into this request if the mediator makes it. He/she may just be asking the attorneys if they think the time is right for the mediator to discuss his/her evaluation of the case, or, if the mediator senses that one side or the other is digging in on that party’s expectations prematurely, the mediator may ask if the attorney thinks it would help for the mediator to speak directly to the party. In some cases where the parties are close to a settlement, but the defense attorney informs the mediator that he/she has reached the limits of his/her authority, the mediator may want to pass along this information to the other attorney to determine if the claimant’s bottom line is close enough to the defense’s limit of authority that the mediator will urge defense counsel to make a call to the necessary individual to get a relatively modest increase in authority in order to get the case settled. Most mediators are willing to put some pressure on the defense attorney to make a phone call to get additional authority as long as the amount requested is not out of proportion to the amount already being offered. However, the mediator may be reluctant to ask the defense attorney to go “to the well” more than once, so he/she is trying to determine if such a phone call is likely to be productive. In any event, your attorney is there to look out for your best interests, and this firm’s attorneys are all experienced in representing clients like you at these mediations.
Keeping an Open Mind: You may remember that we talked about keeping an open mind during a mediation. We discourage our clients from setting a hard and fast bottom line or minimum amount that the client will accept to settle the case before the mediation even begins. We have found that mediation is a process, not a single event. Your position should be flexible to adjust for facts as they become known initially or become clearer at the mediation. That does not mean that you should not give some thought to an acceptable settlement amount, but that amount should not be set in stone going into the mediation. As has been discussed, sometimes the defendants will let it be known that they have reached the limit of their authority to settle the case, and they are still some distance away from your pre-mediation bottom line. Of course you always have the option to say no to any offer made by the defendants and take your chances in litigation, but having sat through the mediation and having learned more about how the other side looks at your case, and maybe hearing what the mediator thinks is a fair evaluation of your claim, you may feel that having your case resolved and the insurance company out of your life and out of your doctor-patient relationship such that you can make your own healthcare decisions free from the carrier’s interference, is an intangible benefit of settlement that you are willing to balance off against the possibility of an increased amount to settle. You will also be hearing your attorney’s estimation of whether you are more likely to get a better outcome from the Commission. Your attorney can discuss what is in front of the Commission and how the Commission can address those issues. Often, the Commission can only deal with your claim in a piecemeal fashion whereas, a settlement is a total and final resolution of your claims in their entirety. After weighing these factors, you may decide the positives outweigh the negatives and agree to accept the defense’s last offer. Mediators often say that a good result from mediation is one that neither side is completely happy with, indicating that both sides gave up something to get to an agreement to settle the claim. Remember the primary object of the mediation process is not for one side or the other to “win” the mediation. The primary objective is to get your case settled on terms which you can accept.

• How should you prepare for Mediation?

Mediation is obviously an important opportunity to resolve your workers’ compensation claim in its entirety. Therefore, you should treat it with the seriousness it deserves. Your dress and demeanor are two things that you can control. While mediation to some extent emphasizes informality and the strict procedures of litigation are relaxed, a certain amount of formality should still be observed. You should be respectful of the other participants, including you opponents, but most particularly the mediator. While their demeanor will be more relaxed in a mediation than in a hearing, the mediators are accustomed to being the person in charge of the proceedings and being treated with a level of respect. If the mediator encourages you to relax and be more informal, you may respond accordingly, but it doesn’t hurt to reserve some level of respect for the process and its participants.
How should I dress for the mediation? In the past, attorneys used to tell clients to dress for court like they would dress for church, but our lives have become increasingly informal, including what we wear and when, and church attendance is no longer universal, such that this advice may no longer be meaningful. Perhaps the most appropriate advice in this day and age is to treat the mediation like an important business meeting or a job interview. Dress how you would for such a meeting. The attorneys and the mediator will be dressed in formal business attire, but you do not need to dress that formally, particularly if you are not accustomed to wearing that type of clothing for a three-hour session. Whatever you choose to wear, your clothing should be neat and clean. No Tee-shirts or shorts, and noting too tight or revealing. Gentlemen should wear a shirt with a collar even if it is only a knit collar like a polo shirt, long pants, and shoes with socks. No shorts, tee shirts, or flip-flops. Facial hair is acceptable so long as it is kept neatly groomed. Any part of your face which you do shave should be freshly shaved (no stubble). If you chose to wear jeans, they should be clean, dark in color, have no rips or tears, and not fit too loosely so that they sag or too tight. Ladies do not have to wear a dress or skirt, but if they do the hemline should not be too far above the knee. No cut-offs, either cropped top shirts or short-shorts. Slacks are fine if the present a clean and neat appearance. Like we said for the men about jeans, if you elect to wear jeans, they should be dark in color, not fit to tight or ride too low on your hips, be clean and not be ripped or torn. Ladies have more options regarding their footwear than the men do. Sandals are acceptable. Hose is optional for ladies, but if you do elect to wear hose, no fishnet stockings. Personal grooming is up to individual tastes. Your hair should be clean and combed regardless of its length or style. Extreme hairdos for either men or women are not encouraged, but once again, that is a matter of personal taste as long as it appears clean and well groomed. If you have concerns about what is appropriate to wear or have other questions about your personal appearance for the mediation, discuss your concerns with your attorney. If either you or your attorney does not feel comfortable about discussing this subject with someone of the opposite sex, your attorney can arrange for you to discuss this topic with a same-sex colleague or staff member. This advice is applicable to your significant other as well should he/she plan on being present at the mediation.
Other preparations: We have already covered the major pre-litigation items for which you can prepare before the actual mediation in our discussion of your appearance and an open-minded attitude. You may also wish to touch bases with your attorney to see if there are any issues specific to your mediation that your attorney suggests you review before the litigation. Since you attorney will be relying in you for the majority of the factual information about your claim, it would be advisable to review any factual material such as accident reports or photographs which either you or your attorney have in your possession. This firm’s attorneys discourage our clients from writing out word for word what you plan to say in your opening statement. Those statements tend to be too long and go into too much detail, plus when you read your statement, you lose the spontaneous quality that makes such statements effective when heard for the first time by the defense decision maker. What we suggest is that you think about the message you would like to convey to the opponent. Can you get the desired message across by telling about a single incident which you have experienced? If so, re-telling that single incident and how that made you feel may be better than your attempting to chronicle every incident which you have experienced since the accident which makes you feel the way you did following the single incident. We suggest that over the weeks between scheduling your mediation with the Commission and the mediation itself, you begin making a list of things you would like the decision-maker to know about you and your life since you were injured at work. As you get closer to the mediation date, you can begin to edit your list to eliminate the more superficial items, leaving only the most important items on your list. Make an outline of the most important items with enough notation that you can glance at the outline item and recall what you want to say about that item. Constantly review and edit your list and you outline until you are comfortable with the broad outline of what you would like to say at the mediation. If you have questions about anything during this process of preparing to give your opening statement, contact your attorney so that the two of you can discuss your question. If, after you give your statement, the mediator wants to ask you any questions about your case, listen politely, but closely to his/her question(s). Answer those questions simply and directly as best you can. Be truthful; if you don’t know the answer to the question asked, don’t attempt to guess. Just say that you don‘t know the answer. This same advice applies to anyone else making an opening statement on your behalf.

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