Big business opts for 'minitrials'

Big businesses, too, have their conflicts. But courtroom justice doesn't always make good business sense. So more and more businessmen may be setting up thier own "minitrials" and leaving the justice system out of it.

Court litigation, Los Angeles attorney Brad Philips sums up, is expensive, prolonged, and often doesn't come to a satisfactory solution from a business standpoint. Rather the businessmen themselves usually know better than lawyers what their interest is in a dispute.

In a minitrial, attorneys give their firms' best case before key management figures from both contesting companies. Then an impartial commentator, agreed on by both companies, remarks on the merits of the case. Lastly, each side retires to come to a decision, usually within an agreed time limit.

The idea was first worked out in 1977 by the law firm Munger, Tolles, and Rickershauser to settle a patent dispute between two companies, TRW and Telecredit. TRW has used the concept again, as have other firms in at least three other cases where publicity was shunned.

But this year could see a spread of the minitrial, says attorney Ron Katz, gauged by the interest of major businesses in a conference held this spring at the University of California at Los Angeles by the Center for Public Resources, an institute in New York. Senior executives from 12 corporations such as Boeing , Phillips Petroleum, and Levi Strauss were paired up for six mock minitrials of the same trademark infringement dispute.

The results of all six mock trials were fairly similar, Mr. Phillips reports, and made a lot of sense. In fact, a judge present gave what would have been his ruling had he case come to court and most executives would have preferred their agreements even to winning the court case.