The Power of Unrelenting Neutrality: Fouad Kurdi on Complex Mediation

Fouad Kurdi is masterful at navigating the nuances of neutrality. He takes great pride in his ability to cultivate a collaborative space where, if he does his job well, all parties feel listened to, respected and only slightly disappointed. This is the world of complex mediation, and this is exactly where Kurdi is meant to be.

Kurdi acts as the greenlight sitting at the congested crossroads of multiple agendas. And there’s nowhere he’d rather be. “Being a part of the solution, being at the center of the action, it's exhilarating,” he says.

Kurdi’s past successes include complex cases involving the opioid crisis for which he landed settlements upwards of $18B. He also recently facilitated a mid-trial settlement in a closely watched federal antitrust case involving a challenged multi-billion dollar merger. “If you have the right skillset and know how to bring people together who have otherwise been fighting for years,” Kurdi maintains, “It’s a big adrenaline rush.” 

Kurdi has a knack for, “Helping really smart people solve really complicated problems.” He would have to, given that he currently serves as the Executive Director of the Takata Airbag Tort Compensation Trust Fund and administers the Takata Airbag Individual Restitution Fund. In a case where 67 million malfunctioning airbags notoriously led to the biggest auto recall in U.S. history, Kurdi has acted as administrator for both funds.

Kurdi was working at Brown Rudnick when he discovered his innate talents happened also to comprise the blueprint of a terrific mediator. “The type of skill sets you associate with litigation are also what makes up good mediators,” Kurdi says. And since making the move to Resolutions, where he now works in-house with Eric Green, Kurdi has directly seen the impact he can make working as a mediator.

Lawdragon: How do you describe your practice?

Fouad Kurdi: My practice is split into two groups. The first is mediation of complex litigation matters including mass tort, mass actions, bankruptcy – basically any issue that has a lot of parties involved and is extraordinarily complicated. The other side is trust and claims administration. That is, whenever you have a negotiated resolution and there is a claims adjudication process that is intended to carry on outside of court, it requires administration of the underlying funds.

Both of those areas require work that generally falls under the “neutral” umbrella, but they are very different. With trust and claims administration, you have long-term responsibilities to many people that involve different responsibilities. On the other hand, mediation is often limited to one discrete matter between a defined number of parties that is resolved – or not resolved – in a relatively short timeframe.

I think if I had to focus on just one of these practices, I’d probably lose my mind. One of the main attractions of mediation is that it’s a voluntary process; the mediator can’t make the parties do anything. But sometimes, especially when dealing with, let’s say, “difficult” individuals, the process can be frustrating. Whereas in trust and claims administration you exert more operational control, which is something that you lack in mediation. The mix of the two helps balance each other out and keeps me energized for all of my work.

LD: How did you get into mediation?

FK: I clerked for a bankruptcy judge in Delaware, which is a pretty prominent forum that has a lot of complex corporate bankruptcies. It was an amazing experience. Then I worked at Brown Rudnick for a couple years in their Boston office, did a lot of commercial bankruptcy there, and then found myself in the world of the neutral shortly thereafter.

At Brown Rudnick, we were representing Eric Green in a really complicated matter, Takata Airbags – they were exploding and killing people, a really big disaster that resulted in the biggest auto recall in U.S. history. There was a criminal proceeding in Michigan that led to a plea agreement, which led to two restitution funds being created. One fund was created for individuals, personal injury and wrongful death victims in the amount of $125M. The other fund was $875M for carmakers who got sued when these Takata airbag inflators malfunctioned.

LD: It must have been challenging to get those funds to all those individuals.

FK: Five or six years into this, there is a feeling that a better job could have been done to get more people to replace their airbag inflators so these things would stop injuring folks so many years after this issue was discovered. But the sad reality is that a lot of the injuries we see involve ruptured inflators installed in vehicles that have been on the road for almost 20 years. Often the title has passed between five or six owners, and for whatever reason, the likelihood that someone driving a 2005 Honda Civic will respond to a recall notice is just way lower than someone who just leased a car and has more reason to keep the car in good shape.

Still, whenever a new claim is submitted, you can’t help but wonder: “Something could have been done to prevent this.” That’s not to suggest that car makers haven’t done an excellent job getting the word out – and the recall completion rates have exceeded most reasonable expectations. But given the volume of defective inflators still on the road, it is a tall task to reach every car owner with a defective airbag inflator and ensure remedial steps are taken to replace the inflator. Still, more can be done.  

Interestingly, Robert Mueller was originally supposed to be the Special Master of these restitution funds. He was initially appointed, but then at that time, he happened to get that other engagement – remember the Trump situation?

LD: I certainly do.

FK: So he had to withdraw and Eric Green got appointed as Special Master. I was still at Brown Rudnick, and we learned that Takata's U.S. subsidiary and some affiliated entities were going to file for bankruptcy. Through the bankruptcy, there was a trust set up to compensate personal injury victims, so it made a lot of sense to have the same person who was the Special Master of the restitution funds be the trustee of the bankruptcy trust. It was going to be a really big engagement, so that’s where I came in. I was very close to the facts in the case and when it got to a conclusion, they needed an executive director to help operate and implement this complicated settlement. Ultimately, I went in-house and moved over to Eric Green's company, Resolutions.

LD: What is it about mediation that fascinates you?

FK: Helping really smart people solve really complicated problems is a big adrenaline rush. If you have the right skillset and know how to bring people together who have otherwise been fighting for years and spending millions of dollars litigating, having the opportunity to help them solve the problem in a mediation session is so rewarding. That’s really what meditation is in these big cases. These sprawling nationwide litigation cases are affecting thousands, if not tens of thousands of people or more. Mediation provides this unique opportunity where everyone has come from around the country to try to resolve this thing that's otherwise been taking up years of their lives. It's nerve wracking, it puts a bunch of pressure on you, but if for some reason people have faith in you to help them with that problem and serve them in that very sensitive and important time, it's hard not to get excited for that opportunity.

LD: How would you describe your style as a mediator?

FK: Very facilitative and collaboration based. A lot of mediators these days come from an ex-judge background. It's safe to say I bring a very different approach. One, because it suits me better and two, because I would have no credibility bringing the approach of an ex-judge type because I just don't have that experience. And even if I tried the retired-judge approach, my sense is that it would not be very effective.

My approach is trying to earn the trust of each side and really, sincerely understanding what their problems are. If there are opportunities that either side is missing, if they're not assessing the risks of continued litigation correctly, I help them understand the strengths and weaknesses of their cases. Also, I’d say it takes a really long time for me to throw in the towel and proclaim a mediation dead. A prominent lawyer I recently worked with described me to their client to be like an “over-zealous real estate agent who is obsessed with closing.” It remains unclear to me whether that was intended as a compliment or not, but I’ll take it!

Mediation is a voluntary process. People can terminate it whenever they want. If they’re going to come to mediate, it is because they want to. If at any moment there stops being an agreement on those points, then people can resume litigating as they’ve been doing. That can be liberating, but at the same time, it’s constricting because you can’t really do too much if the parties don’t want to settle. Which, by the way, is fine. The parties control the outcome at the end of the day, and that’s the beauty of mediation. So it’s a mix of risk assessment and strategic evaluation with both sides, but from somebody who is neutral, who doesn’t have a vested interest in the outcome. It’s amazing how impactful an individual can be just because they do not have a vested interest in the litigation outcome.

LD: And who pays for the mediator?

FK: Great question! Mediation cost is usually shared equally by both sides. If there are multiple sides on any side of the “v” there can be some permutations, but the point I really stress is equality of payment obligations. It helps maintain an environment of neutrality, which is critical to building the right mediation environment.

LD: What leaves you feeling like you've done a great job at the end of a mediation?

FK: It’s rare for everyone to be satisfied, but if everyone is slightly disappointed, that's typically a good sign. You want everyone to have that maximum tolerable discomfort with the mediation or get to a settlement because that means everyone stretched as far as they could. That’s when you feel like you did your job as a mediator.

I'm always very careful at the end of a successful mediation not to say, "Congratulations." It's actually not the right thing to say, especially when the outcome imposes significant obligations on one or more sides. Instead, I say, "I know this might not be the result you hoped for, but at least you can put this behind you now." Everyone is definitely relieved that it's over and that's always a gratifying feeling – to have folks remove the burden they've been living with for so long. These cases can go on forever. To get to a point where it's done, there is something special about being part of that.

LD: Can you tell us about a case that has been particularly challenging?

FK: By far, the most complicated matter I've ever worked on is opioids. It's taken two years to nail down settlements involving states, cities, counties, tribes and various companies who are involved in the opioid supply chain – from the makers of the drugs and those who distribute them to those who dispense them. State attorneys general, political subdivisions, tribes – each of these plaintiff groups have different viewpoints and interests, yet they are all on the “plaintiff” side of the “v.” There are many layers involved which adds to the complexity. So, you’re dealing with these very different, very sophisticated, highly experienced plaintiff groups who are all looking for a national resolution.

Then, on the defense side, these different companies are all saying, "We're not responsible for the opioid epidemic," for various reasons, but ultimately committing to pay billions of dollars because they understand the enormous risks they're facing. Resolving a case like that with as many companies and as many plaintiffs’ groups as we had, was so challenging and time-consuming, but so fulfilling at the end of the day.

Being a part of the solution, being at the center of the action, and all the communications running through you, it's really awesome. It's an amazing opportunity, and I can't imagine having a more defining career success point than this. It really helped me appreciate the scale and type of good that mediators can do, helping to resolve problems of this magnitude.

LD: You clerked with Judge Walrath. Are there any lessons from that time that you use in your mediation practice today?

FK: I learned so many things from her. Aside from just bankruptcy practice, being a good person and a good neutral – unrelenting neutrality I learned from Judge Walrath. I remember a story where an old clerk of hers had sent her a slice of a birthday cake. It was the smallest quantity of birthday cake that you can imagine but it was a token of respect and appreciation. He had clerked for her 10 years prior, but it just so happened that he had appeared before her a couple of years before the gift attempt. Well, she sent that slice of cake right back.

LD: Wow. That’s real commitment.

FK: This was shocking to me at the time, but as I progressed through my career, I've come to respect and appreciate it. The line is so blurry sometimes, and once you cross it, there's no going back. All we have as neutrals is our reputation. Once someone thinks that you are for sale and you give them the smallest space to believe that – that's it, you're toast. You will not be effective at your job and most likely you will not have a job for much longer. I learned from her to really guard my neutrality, even if it means going to extreme lengths like sending back a slice of birthday cake.

LD: You have worked with Eric Green for a while now. He is considered one of the country’s leading mediators. What have you learned from him?

FK: Eric took me under his wing early on and exposed me to the most enriching opportunities. His reputation as a mediator is well documented. Thinking about what I’ve learned from him, I’m not sure where to even begin. It’s a long list. But here’s one thing that immediately comes to mind. Eric never seeks out attention or public recognition for his work. I can say this because I know it to be true: It’s rare to get through a day of reading the legal press without coming across a case that Eric successfully mediated. But you will almost never see his name in print. I respect that so much about him. He taught me to keep my head down and focus on the task at hand; success will come in due course. And he’s living proof of that. But at his core, he is just a good person. He is principled. He is unimpeachable. He’s kind. I owe so much of my success to him, for believing in me and giving me the chance to learn under him. He is a real gem.

LD: How did you first decide you wanted to be a lawyer?

FK: I love that question because what I recently discovered is that the skills I thought made me want to go to law school and become a lawyer were not necessarily litigation-oriented. Negotiation, getting folks to view things in a different way than how they previously viewed things, the type of skill sets that I had originally associated with litigation, are actually the types of things that are well suited for mediators. It's the solving of the problem part of it that I really enjoy. I feel like I can make a difference in mediation way more than I could when I was practicing law. Had I known mediation was a potential career path as a lawyer, I probably would have planned differently early on. But everything happens for a reason, and I’m glad how things have turned out.