In a recent post, I discussed the distinction between “noise” and “bias” as noted in the new book, Noise: A Flaw in Human Judgment (Hachette Book Group, New York 2021)  by Daniel Kahneman, Olivier Sibony, and Cass R. Sunstein.   Although somewhat intense reading, I managed to finish it and realized that the main takeaway is… “Wherever there is judgment, there is noise, and more of it than you think.” (Id. at 255) (“Noise”)

So- how do we get rid of all of this noise? First and foremost is to be aware of it. Another way is what the authors call the Mediating Assessment Protocol, which is to, essentially, break a decision into its component parts, analyze each part independently and separately from each other. When looking at each part, we should be looking at other similar or comparable parts as a baseline. We should then reach a conclusion for each part before going on to the next. Only after analyzing each part completely, do we put the component parts together and analyze them as a whole. And only then, is intuition allowed to be part of the process. In essence, we use a rubric. (Id. at 312-324.)

Thus, if one is trying to determine whether to go to trial or settle, one should first look at liability as a separate and discrete issue, analyze it fully by considering similar cases and arrive at a conclusion as to liability. Only then should one turn to the issue of damages, again analyzing it fully by looking at similar jury verdicts or other decisions on damages and arrive at a conclusion.

Only after fully forming a conclusion about liability and about damages, should one then analyze the matter as a whole – looking at both liability and judgment together and only now adding intuition into the mix.

Using this type of rubric, the authors suggest that a lot of “noise” will be tuned out!

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