I would like to suggest a 7 minute timer for 3 stock in Smash. Thats the most common in tournaments.
Also, the standard procedure for counterpicking after a round is done is as follows:
1) The loser picks the stage
2) The winner picks his character (yes, he can change)
3) The loser picks his character
Sudden Death is not played. If it goes to Sudden Death, the winner is decided by stock first and then least damage.