As a business, it is nearly always in your best interest to try and mediate any disputes that come your way. Going through litigation can be a big, expensive headache that is full of red tape. Mediation also will help you keep valuable contacts, even if you have a dislike for the people who represent those contacts personally. However, according to FindLaw, there are, indeed, certain situations where mediation may not be appropriate or even possible.
First and foremost, if you really and truly believe that the party on the other end of the dispute is guilty and needs to admit it formally, mediation is likely not going to be the path to take. The end result of mediation is generally a compromise that is palatable to both parties, and expecting to mediate your way to an admission of guilt is relatively unlikely. Most of the time, people agree to mediated terms in order to avoid admitting outright guilt.
You also need to consider the value of sending a so-called “message.” Again, generally speaking, it is better to try and fix bridges rather than burn them, but if you believe that the other party has offended so grievously that no amount of reconciliation would be worth more than making a point, then mediation is usually not the answer. Additionally, mediated solutions are usually not legally binding for any party so they will not have an impact on situations in the future.
Finally, it also depends on how open-and-shut you believe your case is. If you think that a jury would be sympathetic to your particular situation, then it may be worthwhile to take the issue to court. Usually, mediated outcomes are not nearly as lucrative as those that juries award in many cases.