By Janice L. Sperow
Unlike many other alternative dispute providers that focus exclusively on conflict resolution outside the courtroom, the International Institute for Conflict Prevention & Resolution (CPR) also places a high premium on dispute prevention.
That’s right–curtailing an emerging issue before it becomes a full-blown legal dispute in the first place. CPR has challenged the corporate world to commit to dispute prevention by signing CPR’s Dispute Prevention Pledge for Business Relationships.
Business disputes impose enormous costs in loss of mission, business, focus, revenue, and relationships. Consequently, today’s savvy leaders understand the need to use every tool possible to prevent them–including increasingly available, sophisticated technology.
Four corporate leaders shared how they leverage technology to prevent business disputes at this year’s CPR Annual Meeting. Corporate counsel in-house thought-leaders joined this article’s author, CPR neutral Janice Sperow, La Mesa, Calif.’s Sperow ADR Services. who moderated a March 2 #CPRAM22 discussion on the role of technology in preventing disputes.
The panel explored data transformation’s accelerating role in avoiding litigation, securing compliance, and minimizing risk across a wide range of industries, sectors, and markets. From “big data,” software development, and retail sales, to aerospace and defense, these experts explained how they navigate the benefits and challenges of today’s technology and tomorrow’s automation.
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The corporate counsel panelists included leaders in their fields: Amy Yeung, General Counsel and Chief Privacy Officer for Lotame Solutions Inc., a Columbia, Md., data collection and management consulting firm; Nick Barnaby, Staff Vice President and Associate General Counsel at aerospace defense contractor General Dynamics Corp. in Reston, Va.; Chris Nelson, head of the Data & Operations Team for Microsoft Corp.’s Compliance & Ethics organization in Redmond, Wash., and Kenneth Oh, Vice President of Privacy for Bath & Body Works, headquartered in Reynoldsburg, Ohio..
Before Lotame, Amy Yeung started her career the conventional way, in law firm practice. She soon went in-house, joining Zenimax Media Inc., a Rockville, Md.-based global video game publisher, as Associate General Counsel. She then moved to New York-based artificial intelligence platform Dataminr. Continuing to build on her successes, she became Deputy General Counsel at Comscore Inc., in Reston, Va., where she was integral in evolving the company to compliance with new and prospective privacy regulations, in addition to launching Comscore products.
Like Amy, Chris Nelson is no stranger to big data. His Microsoft position has primary responsibility for workplace- and business-conduct. The Data & Operations Team (DOT), brings together data analysts, program managers, and legal professionals to design and operate solutions that increase the effectiveness of investigations, translate learnings into data-driven insights, and build predictive models and analytics that help the company mitigate emerging compliance risks. Chris is also a core member of Microsoft’s Anti-Corruption Technology & Solutions program, a 10-year effort to “bend the curve” of corruption by delivering expertise and anticorruption technology to governments. Chris worked as Microsoft corporate counsel before taking over DOT.
Protecting new technology, Kenneth Oh is a privacy and intellectual property attorney with more than 25 years of experience. He is a former Trademark Examiner with the U.S. Patent and Trademark Office and was of counsel with Washington, D.C.’s Baker & Hostetler, where he advised clients on intellectual property issues, litigated cases, and appeared before the USPTO’s Trademark Trial and Appeal Board. He served as Associate General Counsel at Bentonville, Ark.’s Walmart Inc., and Assistant Vice President, Privacy and IP Corporate Counsel with Miami-based TracFone Wireless Inc. before becoming the Assistant Vice President, Privacy at Bath & Body Works Inc.
Handling large government and other contracts, Nick Barnaby is General Dynamics’ Staff Vice President and Associate General Counsel, where he advises on many of the company’s most significant litigation and disputes. Nick works on identifying and avoiding potential risks and disputes. Prior to joining General Dynamics, Nick was a partner at Jenner & Block, focusing on internal investigations and commercial litigation.
Moderator Janice Sperow is a full-time neutral, CPR arbitrator and mediator, hearing officer, special master, and Judge Pro Tem who serves on several arbitration panels, including emerging technology, complex commercial, and employment disputes. Formerly a litigator with Morrison & Foerster and then Managing Partner and Head of Litigation & ADR at Ruiz & Sperow, Janice has served as an arbitrator for more than 35 years, overseen more than 450 arbitrations as an arbitrator, and conducted more than 1,000 arbitrations as counsel. Like CPR, she also focuses on dispute prevention.
Despite their differences, the panelists shared one key innovation: they are on the cutting edge in using technology to prevent disputes and mitigate risk.
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The Format: The moderator used a series of questions to launch the dialogue. Here is what the panelists shared with CPR at its annual meeting.
Question: Share with us how your company currently uses technology to prevent disputes and avoid risks.
Chris: Microsoft aggressively uses technology inside the company to fuel its compliance programs and to drive a culture of accountability and business ownership of risk. One of the critical avenues Microsoft uses focuses on increasing the use of data and data fluency on the legal compliance side so that managers and risk owners can translate historically subjective descriptions of risk into objective quantifiable indicators of why a particular risk is trending high or low as compared to the rest of the world–all in the business language they understand and work with daily. It also paints a big picture of how the risk looks over time, its scope, magnitude, and current probability.
Amy: Lotame pulls together a lot of big data sets for commercial advertising purposes, but many companies also use these same data sets to address risk. For example, insurance and financial companies use them to round out their own data for benchmarking, context, and discrimination avoidance. Prior companies, such as Dataminr, capture social media content for immediate use on the ground, such as in the Ukraine conflict, to protect employees and personnel at risk by feeding them real-time data. Other companies use the data for anticipatory prevention such as crafting policies or developing training to address predicted risks.
Kenneth: Bath & Body Works focuses on technology use to protect privacy. In today’s world, it would frankly not be possible to practice privacy law without technology, AI, and third-party vendor software that track data, systems, and populates necessary information fields. Technology reduces the risk of human error as the AI manipulates the data.
Nick: General Dynamics likes to use technology to address the root causes of disputes. Most disputes trace back to three sources or drivers: poor business partners, poor assumptions, or poor contractual terms. For example, technology-assisted due diligence of potential suppliers or partners can uncover more information quicker than a manual review. It may reveal information that can permit the parties to structure a deal which addresses that information directly before a problem arises, or even information that permits a company to choose not to partner with a particular entity.
Question: Dispute prevention looks both backward and forward. We hope to learn from past disputes and avoid repeating them. We also hope to use data to predict potential future problems and avoid them. How has your company used technology both to prevent repeat problems and to avoid future risks?
Chris: Microsoft has been on a multi-year journey to learn how to capture lessons from disputes, workplace investigations, and corruption cases to then try to hone them into a compass that can help point in the direction of likely problems in other places to ideally avoid them, since most risks are serial in nature. Microsoft then feeds those lessons back to the management teams to implement and thereby can avoid a whistleblower case, for example, before it happens. While Microsoft understands that reactive capabilities are critical and therefore it has hotlines, complaint, and ethical issue avenues for problems requiring immediate redress, its focus also includes a proactive approach, for if we do not proactively apply what we learned, then we have as a society have learned nothing. Reactive posturing is a long-term losing proposition.
Amy: Post-mortems are critical on all levels: individual, enterprise, strategic. Plus, the data sets can serve as an independent check to confirm that the company is on the right track. The data become a movable white board to hold us all accountable and to avoid repeating mistakes because we all share in the lessons learned based upon the data.
Question: What are some of the most underused technologies in the corporate world today? Technology that could really help prevent disputes and risk but that we are simply not taking full advantage of?
Nick: Data currently used for business purposes could often be leveraged to mitigate risk if seen through that lens. For example, a budding contract dispute in a long-term contract can often mask a bigger underlying issue, such as a failure to meet a contractual obligation. If we used the information we collect in the aggregate for business purposes for prevention purposes, we could often address concerns before they ripen into full-blown disputes. General Dynamics, and likely many other companies, could use the information they already capture for business uses and repurpose it for risk-management purposes and to escalate the issue more quickly to higher-level decisionmakers before it blossoms into litigation.
Ken: Technology tools work exceptionally well for version- and document control. [Version control tracks systemic changes in software engineering.] We actually have many tools right now that we do not fully understand and use to their maximum capabilities.
Chris: The type of tool most needed and underused depends on the type of risk. For example, for financial risks, data architecture and structure are key. At the executive level, if the company is deciding where to deploy personnel to manage risk, then visualization and constant monitoring are essential.
Question: Greater technology use certainly achieves greater benefits. But it also comes with its own challenges. What are some of the issues you have faced with increased reliance on technology and how have you navigated them?
Amy: The greater the footprint grows, the more resources the company needs to devote to it. For example, most companies adopted email without pre-planning or thought. Now, emails frequently represent litigation fodder. Well, many companies are not currently thinking of today’s email equivalent–the data and technology we are using or adopting today and how it will be used in disputes down the road. Thus, one of the key challenges both at the enterprise and commercial level is the thoughtful planned and integrated structure for technology use at your company. Earlier architecture and ongoing monitoring of data uses can create a much more seamless integration of technology and avoid some types of risk before they occur.
Nick: General Dynamics very deeply values transparency and trust. So, one of the challenges we face in any adoption of new technology is managing the culture around its implementation, requiring us to focus on alignment and trust so employees understand the purpose, need, and benefit of the technology. General Dynamics empowers employees to use and adopt the technology themselves rather than imposing it on them.
Question: How does data ethics fit in?
Amy: Awareness and enactment of data privacy regulations has definitely increased dramatically. Consumers are also becoming more conscious of the varying uses of their data. We data professionals are really looking at the ethics involved in data use and taking responsibility. We do a gut check: Are our assumptions correct? Did we start with the right questions to begin with? Is this the right thing to do?
Question: What has really been worth it in terms of return on investment? If you had to choose one technology that has most impacted your company’s bottom line in terms of dispute and risk cost savings, what would it be?
Kenneth: Privacy software. Frankly, it would subject the company to statutory liability and damages not to properly monitor the use and privacy of customer data with available technology.
Chris: Microsoft uses its own really deep stack of technological tools. In addition, Microsoft spends on securing rich, valuable data sources, especially when working with governments. We also spend on data fluency, making sure we have the personnel who can bridge the risk managers to the backend data.
Nick: Technology limiting and eliminating the environmental impact of our operations. Investing in remedial technology beyond legal requirements to reduce any lingering liability from past environmental issues that occurred before people understood the environmental impact of the chemicals and materials used.
Question: How has data automation affected your own department? Has it helped prevent disputes and minimize risk?
Ken: Access to data quickly has allowed us to prevent disputes.
Chris: Data transformed the de-escalation of the energy after an investigation or dispute. After a dispute, the stakeholders meet and determine the critical failure points. At the end of the meeting, they are energized to avoid the same problems in the future. But a manual audit approach does not have a good return on investment and tends to deenergize the good intentions and follow up. Data has transformed that phenomenon. Now, people have data and a model showing where to look next for the problem to surface and to avoid it, rather than anecdotal memories. Vertically integrating the process to avoid waiting to get answers and analytics in the middle of the process has really helped as well.
Nick: Technology has helped us diagnose legal spend and determine patterns with data analysis rather than an old-school subjective review of legal bills.
Question: Predictions–Experts predict that we will see more technological advances in the next decade than we did in the past century. Given our world’s accelerated data transformation, what area do you predict will see the greatest advancements in dispute prevention over the next five years?
Nick: A more-hope-than-a-prediction that conscientious folks will use technology for good purposes, such as preventing disputes, and not just to gain an advantage.
Amy: Consolidation and integration of technology uses and functions.
Chris: Natural language processing.
Moderator: Personalized and genetics-based healthcare.
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Key Themes & Takeaways:
- With greater technological advancement, comes greater responsibility.
- Use technology in a language business managers understand to achieve common goals.
- Real-time data allow on-the-ground, in-the-moment decision-making to mitigate immediate risks, such as supply-chain blockage due to extreme weather or civil unrest.
- Keeping knowledgeable and current on developing technology allows companies and individuals to pivot nearly instantaneously to new business opportunities.
- Technology-assisted due diligence can more easily permit companies to partner and align themselves with others that share their goals and values.
- Capturing data over time illustrates the serial risks companies face, their pattern, and where they are likely to surface next.
- Technology allows society to turn its past lessons more easily into future remedies.
- Repurpose and leverage data already captured and monetized for business uses to prevent disputes.
- Understand and use all the features of your technology.
- The nature of the risk will often dictate the best technological tool to prevent it.
- Data ethics must be a conscious part of all technology use.
- Ultimately, technology is only as good as the uses to which we, as humans, put it.
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Take the Pledge:
If you agree that dispute prevention should play a vital role in our economy and society but are not sure where to begin, start by taking the CPR Dispute Prevention Pledge for Business Relationships. If you would like to become more active in dispute prevention, join CPR’s Dispute Prevention Committee, or if the intersection with technology sparks your interest, join CPR’s Technology Advisory Committee. Contact CPR Senior Vice-President Ellen Parker at firstname.lastname@example.org. For other questions or information about this article or the roundtable, contact Janice Sperow at email@example.com.
CPR members can access the roundtable video and other #CPRAM2022 sessions after signing in here.
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Author Janice Sperow is a full-time neutral, arbitrator, mediator, dispute prevention facilitator, and Hearing Officer specializing in mass claims, healthcare, technology, employment, and all commercial matters. She works on domestic and international matters at her La Mesa, Calif., firm, Sperow ADR Services. Her previous CPR Speaks article was “Increased Mobile Health Triggers Increased FTC Enforcement, and Points to a Need for Dispute Prevention Efforts,” CPR Speaks (Nov. 4, 2021) (available here).