The Law on Evidence for Foreign Arbitrations Returns to the Supreme Court

By Bryanna Rainwater

The question of whether a foreign or international tribunal includes arbitration panels for the purposes of providing evidence under a federal court order is back before the U.S. Supreme Court. The case is being briefed and is expected to be added for a conference in which the Court’s members will decide whether to hear the case.

The issue had been set as one of the first tasks for the Court in the opening week of the new 2021-2022 term, earlier this month.

 But in September, the Court dismissed the case at the parties’ request, and the issue about the reach of 28 U.S.C. §1782—”Assistance to foreign and international tribunals and to litigants before such tribunals”–disappeared from the court’s docket.

The latest case, ZF Automotive US, Inc., v. Luxshare, Ltd., Docket No. 21-401, filed Sept. 10, presents the identical question as the dismissed case, with one key difference. The issue presented is:

Whether 28 U.S.C. § 1782(a), which permits litigants to invoke the authority of United States courts to render assistance in gathering evidence for use in “a foreign or international tribunal,” encompasses private commercial arbitral tribunals, as the U.S. Courts of Appeals for the 4th and 6th Circuits have held, or excludes such tribunals, as the U.S. Courts of Appeals for the 2nd, 5th and 7th Circuits have held.

The difference in the new version of the case, according to the petitioners, is that it is a “live controversy” and therefore “free from a potential jurisdictional hurdle” that plagued Servotronics, Inc. v. Rolls-Royce PLC, No. 20-794, the case that was dismissed by the nation’s top Court on Sept. 29.

The hurdle referred to by the ZF Automotive petitioners, a Michigan auto parts manufacturer and a subsidiary of Germany’s ZF Friedrichshafen AG, and two executives associated with the company, is Servotronics’ mootness, because the discovery in the case was no longer needed in the face of the arbitration proceedings and the award. (The cert petition is available here.)

Servotronics had sought to end the Circuit split about the interpretation of the meaning “foreign international tribunal.” The Fourth and Sixth U.S. Circuit Courts of Appeals have held that 28 U.S.C. § 1782 encompasses private commercial arbitrable tribunals, as noted in the new ZF Automotive petition and its question presented, while the Second, Fifth, and Seventh Circuits have gone with a more limited approach which does not consider these private arbitrable tribunals to fit within the meaning of  the statute and, therefore, have denied discovery requests.

Servotronics was scheduled for oral argument on Oct. 5, the second day of the Court’s term, but removed from the calendar after the arbitration in the case was conducted in the spring, and the parties moved to dismiss the case in the wake of a July award.

For more on the Servotronics case dismissal and the case history, see Bryanna Rainwater, “Case Dismissed: Supreme Court Lightens Its Arbitration Load as Servotronics Is Removed from 2021-22 Docket,” CPR Speaks (Sept. 8) (available here).

The ZF Automotive petitioners urge the Court to clear up the circuit split and decide the true interpretative meaning of §1782. They argue that Servotronics amicus briefs warn that without resolving the §1782 issue for private international tribunals, there could be a disincentive for parties from entering into international contractual agreements.

Respondent Luxshare, a Hong Kong limited liability company, bought ZF AG’s Global Body Control Systems business in August 2017. During this transaction, the parties signed a Master Purchase Agreement which provides that disputes are to be governed under German law. The petitioners noted that Luxshare waited to file a §1782 application for discovery for more than two years after the transaction’s closing in pursuit of the purchaser’s fraud allegations.

Because the arbitration agreement specified that the DIS—that is, the German Arbitration Institute–would provide the panel to arbitrate the issues between the parties, the petitioner argues that the panel does not satisfy the requirement of being a “tribunal” within the meaning of §1782.

Luxshare filed the original claim in Michigan’s federal Eastern U.S. District Court under §1728 to seek discovery—documents and testimony–from ZF Automotive US and the officers before the arbitration. U.S. Magistrate Judge Anthony P. Patti granted the discovery in a limited scope, and ZF Automotive US’s subsequent motion to stay was denied by the district court.

Arguing that the interpretation of the Sixth Circuit—which oversees Michigan cases–is mistaken, the petitioners cite legal scholars, the Court’s own precedent and dictionary definitions to support their proposition that §1728(a) “includes only governmental or intergovernmental adjudicative bodies, and excludes private arbitrators that have no sovereign authority.”

In its reply brief, Luxshare counters that the case is a poor vehicle to examine the statute. “[T]he question presented may not be dispositive of this case, and may not even be necessary to resolve this case,” the reply notes, because even if the foreign tribunal definition included the DIS arbitration panel, their adversaries maintain that there are case-specific reasons for vacating discovery in the case. (The reply brief in opposition to certiorari is available here.)

Moreover, the reply notes that, like Servotronics, the case is likely to become moot before the Court can rule due to the unlikelihood of the petitioners agreeing to extend the time for arbitration.

In fact, the petitioners filed an Oct. 15 application for a Supreme Court stay on discovery to avoid the mootness issue with Associate Justice Brett Kavanaugh, who is the Court’s justice for the Sixth Circuit. (Available here.)

In a response filed yesterday, Luxshare contended that the ZF Automotive petitioners had not met the standards to grant a stay, and added that the stay would injure the company because it “will deny Luxshare the basic right to have its fraud claims against ZF US adjudicated based on the evidence.” 

Luxshare also wrote in its reply that the Court should deny the stay “for the additional reason that it would disserve the public interest, by both frustrating Congress’s purpose in enacting § 1782(a) and permitting fraud to go unremedied.”

An order had not been issued as of this post.

In addition:  ZF Automotive is no longer alone before the Court on § 1782.  The Luxshare brief advocating that the Court deny the cert petition points out that AlixPartners, LLC v. Fund for Protection of Investor Rights in Foreign States, No. 21-518, covers the same turf.  The Oct. 5 petition (available here) for certiorari asks, similarly, “Whether an ad hoc arbitration to resolve a commercial dispute between two parties is a ‘foreign or international tribunal’ under 28 U.S.C. § 1782(a) where the arbitral panel does not exercise any governmental or quasi-governmental authority.”

* * *

The author, a second-year student at Brooklyn Law School, is a 2021 CPR Fall Intern. Alternatives editor Russ Bleemer contributed to this post.

[END]

The Current State of Arbitration in India–Recent Developments

By Arjan Bir Singh Sodhi

CPR’s Arbitration Committee conducted a Sept. 23 Zoom on recent India conflict resolution developments. The session also provided an update on the “CPR Corporate Counsel Manual for Cross-Border Dispute Resolution–India Supplement.” (See the new supplement on CPR’s website at https://bit.ly/3oR6y7l.)

Viren Mascarenhas, a partner in King & Spalding’s London and New York offices who is the India Supplement’s co-editor and CPR Arbitration Committee vice chair, moderated the discussion. The panel included:

  • Tapasi Sil, general counsel–South Asia, GE Renewable Energy, Dehli, India
  • Rishab Gupta, partner, Shardul Amarchand Mangaldas & Co., Mumbai
  • Shaneen Parikh, partner (head-international arbitration), Cyril Amarchand Mangaldas, Mumbai
  • Sanjeev K. Kapoor, partner, Khaitan & Co., New Dehli, India
  • Quentin Pak, director, Burford Capital, Singapore

For more on the panelists’ and the program’s background, see CPR’s website here.

Viren Mascarenhas kicked off the discussion, welcoming the panelists, and updating on the new version of the CPR Corporate Counsel Manual for Cross-Border Dispute Resolution–India Supplement.

Tapasi Sil provided a view on her international work as an in-house counsel, and how business sees the development of India arbitration from her position as GE Renewable Energy counsel. She acknowledged the positive impacts amendments to the Indian Arbitration and Conciliation Act of 1996, but she also noted that business might face strains in using arbitration over time and costs.

Sil also noted a lack of expertise in commercial and technical knowledge required by the current India arbitrators. She said she hoped that India would welcome diversity and inclusion in arbitration in the future, and increase the numbers of women arbitrators.

Panelist Rishab Gupta also addressed the Indian Arbitration and Conciliation Act of 1996, which he said is based on the UNCITRAL Model Law on International Commercial Arbitration (1985). While pointing out many similarities of the Indian arbitration law with other common law jurisdictions, he noted that the law still required multiple amendments due to cultural factors such as:

  • A long history of having only ad hoc arbitration and a lack of institutional arbitration;
  • The need for a more professional arbitration body that focuses on arbitration expertise emphasizing commercial and technical knowledge;
  • A lack of professional arbitrators, and more focus on litigation for dispute resolution;
  • A lack of trust in the arbitration process, which, according to Gupta, is a result of the above three factors, and
  • The frequent move to Singapore as an arbitration seat for most corporate and cross-border disputes.

Shaneen Parikh of Cyril Amarchand Mangaldas covered India’s current Arbitration and Conciliation Act of 1996 amendment. She spoke about the April pro-arbitration judgment from the Indian Supreme Court, citing Justice Rohinton Fali Nariman in PASL Wind Solutions v. GE Power Conversion India (available, after cutting and pasting, at https://bit.ly/2WZpll8), where it was concluded that two Indian parties could choose a foreign seat of arbitration.

The judgment, noted Parikh, upholds a fundamental ADR principle, party autonomy. She also spoke about the interim relief covered in Section 9 (available, after cutting and pasting, at https://indiankanoon.org/doc/1079220) of the Indian Arbitration and Conciliation Act of 1996.

Furthermore, in the PASL Wind Solutions case, India Supreme Court Justice Nariman referred to the Convention on the Recognition and Enforcement of Foreign Arbitral Award, better known as the New York Convention (see www.newyorkconvention.org), to rule that different international commercial arbitration and foreign awards are enforceable. In the decision, Parikh pointed out, Justice Nariman also held that awards considerations should involve the territory involved, not the parties’ nationality.

Parikh concluded her segment of the panel discussion by discussing the need for more institutional arbitration for domestic and foreign matters.

Khaitan’s Sanjeev Kapoor discussed the interim arbitration procedures and how they are being enforced in India. He said that there are three major issues often faced by the Indian courts:

1) interim orders by arbitration tribunals or domestic arbitration institutions;

2) interim orders by emergency arbitrators in India, and interim orders from foreign arbitration tribunals, and

3) challenges to foreign awards, though he added that there are not many challenges when it comes to enforcing domestic awards in India.

Kapoor said that interim relief involves getting the award from a domestic tribunal and then filing an application under Section 9 of the Indian Arbitration and Conciliation Act of 1996. He also discussed PASL Wind Solutions.

Burford’s Quentin Pak shared his thoughts on the Indian capital market and third-party funding. He pointed out three major factors he said he believes are the factors in the increase in the third-party funding of international arbitration proceedings:

1) Singapore and Hong Kong are passing legislation encouraging third-party funding of arbitration.

2) International companies prefer the Singapore International Arbitration Centre over domestic seats, and

3) The Covid-19 pandemic put pressure on corporations’ balance sheets, accelerating the use of third-party funding. 

Pak concluded by talking about the requirement of funding in India-seated arbitrations, and the monetization of India awards because of the size and growth of the Indian market to international investors.

* * *

The author, a CPR 2021 Fall Intern, is an LLM candidate at the Straus Institute for Dispute Resolution, at Malibu, Calif.’s Pepperdine University Caruso School of Law.

[END]

CPR’s International Conference: European Views on the Resolution of Complex Technology Disputes

By Tamia Sutherland

During the Oct. 6-7 CPR International Conference–the first the New York-based conflict resolution think tank and publisher of the CPR Speaks blog has held combining the work of its international advisory boards–CPR’s European Advisory Board presented a virtual panel centered around resolving complex technology disputes.

The panel discussed highly technical blockchain, patent, and intellectual property disputes. Mark McNeill, a New York and London partner in Quinn Emanuel Urquhart & Sullivan, moderated the panel that included:

  • Luke Sobota, a founding partner and Washington, D.C., managing partner at Three Crowns,
  • Edith Jamet, general counsel at SoftAtHome, a Colombes, France, software company, and
  • Mark Beckett, chief information officer at ArbiLex, an arbitration analytics and funding consulting firm based in Allston, Mass.

After introductions, Moderator McNeill posed a question about the resolution of blockchain disputes. Panelist Luke Sobota explained that blockchain operates as a fixed ledger stored internationally on computers world-wide, making the recorded data hack-proof as “the block exists everywhere at once, and nowhere in particular.” Though the blockchain is secure, it cannot anticipate every mistake or account for human error.

To illustrate what types of disputes may arise as a result of blockchain use, Sobota provided the following example: Blockchain technology can be used in commercial transactions by including a QR code with delivered goods that automatically transfers the payment from the buyer’s cryptocurrency account to the seller’s account, and records the transaction on a block when scanned by the recipient, also known as an oracle.

Sobota defined an oracle as “a real-world objective piece of data that the blockchain software, itself, can retrieve and verify.” This process does not require third-party involvement, and is “both the promise and limitation” of the technology, he said.

The oracle, however, can fall short. Disputes can arise when a recipient of goods fraudulently refuses to scan the QR code; the code has a bug that results in an excessive transfer of money; or the goods are partially damaged as there is no code for partial payment or refunds.

Due to blockchain’s decentralized nature, domestic courts do not have jurisdiction to resolve these transnational disputes, and sometimes, the parties are anonymous. Sobota explained that the two forms of arbitration best suited to resolve these unique disputes are (1) on-block arbitrations and (2) traditional commercial arbitrations.

On-block arbitrations are administered through various platforms and are currently “quite minimalist and only suitable to very simple transactions,” according to Sobota. In this case, parties agree that anonymous “jurors” will resolve the dispute, and the discrepancy is remedied automatically on the blockchain by issuing a new block.

For example, an on-block arbitration can immediately provide a refund for partially damaged goods. Panelist Mark Beckett mentioned Kleros, which is an example of an arbitration platform that relies on smart contracts and anonymized jurors to resolve disputes.

While this appears to be an easy and effective solution, questions about a lack of juror guidance, financial incentives, outside pressures, and concerns regarding juror consistency are critiques of the decentralized justice method.

Moderator McNeill then asked panelist Edith Jamet about the types of disputes she sees and how she prefers to resolve the disputes in her in-house role at a software company. She said she typically deals with patent issues. She said confidentiality is essential, and thus, mediation is best to find resolutions, and arbitrations are second best when the parties cannot come to a decision. She conceded, however, that sometimes court is mandatory and can be more secure.

Jamet discussed a mediation with the French tax administration where she had to demonstrate that her company’s technology was innovative and therefore eligible for a tax credit. Emphasizing Luke Sobota’s earlier point about finding sufficiently knowledgeable neutrals, Jamet said that she had to make an analogy to train tracks to illustrate her company’s technological software advancements because it was complex and she wanted the mediator to understand her arguments.

In response to an inquiry about the arbitration’s suitability for IP disputes, Mark Beckett raised skepticism about the number of neutrals who have technical knowledge. He noted that, in court, at least there is a right to appeal. Luke Sobota noted again that suitability depends on the neutrals chosen. In the case of typical IP contractual disputes, however, no special knowledge is necessary, said Sobota.  

Moderator McNeill asked Mark Beckett about ArbiLex, its mission, and what it can do. Beckett replied that ArbiLex is a legal technology startup that uses artificial intelligence and predictive analytics in international arbitration. The company provides practitioners and institutions with data to determine whether they should litigate or arbitrate a case. Ethics guidance states that lawyers generally cannot give a percentage chance of prevailing in a dispute due to predictive limitations. But ArbiLex is providing data for parties to assess the chances of prevailing in disputes.

Beckett explained that ArbiLex’s system can run combinations of different tribunals to provide outcome prediction analysis, provide information on who appointed certain arbitrators, predict case outcomes, relate outcomes to whom a particular arbitrator is sitting with, and provide data on how counsel has performed against each other. The information and graphics provided by ArbiLex, said Beckett, could cut down on the amount of research practitioners need to make tough decisions regarding dispute resolution of complex issues, where various interests may be pulling the practitioner in different directions.

Throughout the conversation, the neutrals that participate in CPR’s Technology Advisory Committee were mentioned as resources for finding technologically knowledgeable neutrals when these complex technology disputes arise.

* * *

The author, a second-year law student at the Howard University School of Law in Washington, D.C., is a CPR 2021 Fall Intern.

 [END]

UNCITRAL Adopts Expedited Arbitration Rules

By Mylene Chan

This is the third part of a series of CPR Speaks posts reporting on the United Nations Commission on International Trade Law’s 54th session where the commission adopted legislative and non-legislative texts relating to alternative dispute resolution. 

At the three-week session concluding July 16, the commission adopted the UNCITRAL Expedited Arbitration Rules and the Explanatory Notes to the UNCITRAL Expedited Rules. These rules and notes complement and are intended to be read together with UNCITRAL’s well-known arbitration rules, which are for resolving international disputes and applicable both in administered arbitrations under the auspices of an arbitral institution, as well as in ad hoc arbitrations.

The UNCITRAL Arbitration Rules were originally developed as an alternative to other major rule systems. UNCITRAL’s innovative rules were initially viewed with skepticism, but over time, they have been frequently used in investment arbitrations, commercial arbitrations, arbitrations between states, and between states and individuals, such as for the Iran-U.S. Claims Tribunals and several bilateral investment treaties. Latham & Watkins Guide to International Arbitration (2019) (available at https://bit.ly/2VeZKU8).

The UNCITRAL Arbitration Rules have gone through three versions, in 1976, 2010 (revised to meet the needs of modern business including improvements to procedural efficiency, inclusion of provisions on multi-party arbitration and the development of rules on interim measures; available at https://bit.ly/3i7UrPq), and 2013 (incorporated rules on transparency for investment arbitrations based on treaties; available at https://bit.ly/2UZMEKH). See general background on the rules from UNCITRAL at https://bit.ly/3l6RyjD.

In 2018, UNCITRAL mandated Working Group II to explore ways to improve the efficiency of the arbitral proceedings through streamlining and simplifying procedures, resulting in the drafting of the UNCITRAL Expedited Arbitration Rules. The goal is to reach a final dispute resolution in a cost- and time-effective manner while ensuring due process and fair treatment for the disputants. (See https://undocs.org/en/A/CN.9/934 for the 2018 statement on expedited rules.)

For coverage of the early drafting process of the UNCITRAL Expedited Arbitration Rules, see Piotr Wójtowicz & Franco Gevaerd, “How UNCITRAL’s Working Group II on Arbitration Is Analyzing the Field to Help Expedited Processes” 37 Alternatives 90 (June 2019) (available at https://bit.ly/377Nfwg), and Piotr Wójtowicz & Franco Gevaerd,  “The Framework: The U.N.’s Working Group II Debates New Expedited Arbitration Rules,” 37 Alternatives 99 (July/August 2019) (available at https://bit.ly/3l5OLqS).

Special features in the UNCITRAL expedited arbitration rules include the following:

  • Disputes under the expedited procedures shall be settled in accordance with the UNCITRAL Arbitration Rules as modified by the expedited rules.
  • The expedited rules shall apply only with express consent by the disputants.
  • To facilitate speedy constitution of the tribunal, the claimant must include, with its notice of arbitration, the proposal of an appointment authority and the arbitrator. The notice of arbitration constitutes the claimant’s statement of claim. The respondent then has 15 days to file a response to the notice of arbitration. By contrast, under UNCITRAL Arbitration Rules, the time to respond is 30 days from the receipt of the notice of arbitration.
  • When the disputants cannot agree on an appointing authority, any disputant can request that the Permanent Court of Arbitration Secretary-General designate the appointing authority or serve as appointing authority. The PCA Secretary-General has discretion to decline serving as appointing authority and designate another authority if it deems it more appropriate. In this way, the UNCITRAL Expedited Rules have deviated from the default two-step designation/appointment procedure found in the non-expedited UNCITRAL Arbitration Rules.
  • The tribunal has discretion in shaping the proceedings, including extending or abridging timeframes (except for award issuance, as discussed in the bullet below) and determining whether hearings will be held or evidence taken.  This discretion represents an expansion of the discretion contained in the UNCITRAL Arbitration Rules.
  • The time period for rendering the award employs a bifurcated approach. If the tribunal considers that it is at risk of not rendering an award within nine months, it shall propose a final extended time limit. If all disputants agree, the extension is considered adopted.  If a party objects to the extension, however, any party may make a request that the UNCITRAL Expedited Rules no longer apply to the arbitration. After hearing the disputants, the tribunal may then decide that it will instead conduct the proceedings in accordance with the UNCITRAL Arbitration Rules, which do not contain the time limits.

The most contentious issue was the last bullet point above regarding the time period for rendering the award. Working Group II spent more than six hours debating on this point during the 54th session, focusing on how to balance the policy interest of promoting a truly expedited process with the goal of ensuring that the result of that process would be enforceable through the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, better known as the New York Convention.

At one point, the U.S. delegation objected vehemently that “[u]sing this approach, as the default in the rules, creates a very concerning precedent for an uncontrolled instrument in our delegation’s experience.  . . . That is why we have drafted the compromise language that . . . seeks to bridge the gap between delegations like ours, who are very concerned about adopting a system that will likely produce unknowable awards, and those delegations who primarily are concerned that without a hard stop at nine months, the rules will enable arbitrators who were not very diligent, or who simply procrastinated to continue to take extensions.”

There were more concerns about protecting those with lesser means and bargaining power:

  • The U.S. delegation noted, “We think that given that these rules may be used by unsophisticated parties because they are expedited, . . . one of the goals is to reach out to parties who might be otherwise deterred from pursuing arbitration because of the cost.  . . .”
  • The Israel delegation point out that “[t]here could be concerns of parties with weaker bargaining powers that would have to be essentially compelled to agree to this.  . . .”

While the debate was heated, ultimately the member states drafted an innovative approach to reach a consensus. 

The UNCITRAL Expedited Arbitration Rules will appear together with the explanatory notes toward the end of the year as an appendix to the UNCITRAL Arbitration Rules.  In the fall, Working Group II will deliberate on rules about early dismissal of frivolous claims that will require modifications to the UNCITRAL Arbitration Rules. Working Group II will post the final rules, and currently has the drafts, here.

In addition, UNCITRAL is contemplating developing a new framework for adjudication. commonly known as dispute resolution boards, to complement the UNCITRAL Arbitration Rules. There has been a recurring expression of interest within UNCITRAL member states in the principle of rapid decision common to adjudication in construction projects. The U.S. delegation noted that it hoped that this principle can be adapted to expedite the resolution of disputes in other long-term contracts, or at least to mitigate the impact of those disputes.

UNCITRAL expects to conduct colloquiums to discuss adjudication next spring. With the adoption of the expedited rules, UNCITRAL is taking steps to expand the use of arbitration as a method of dispute resolution available to a wider range of parties.

Thomas W. Walsh, special counsel based in the New York office of Freshfields, who in his arbitration work focuses on UNCITRAL matters and worked on an early draft of the UNCITRAL Expedited Rules, said that the rules “are a welcome example of the arbitration community responding to the needs of the businesses that use arbitration. If parties have a commercial need to expedite the resolution of their dispute, the rules offer a thoughtful, ready-made procedure that they can select to meet that commercial need.”

The UNCITRAL Expedited Rules eliminate many of the obstacles that made arbitration costly and overly time-consuming, and the role of UNCITRAL as a global trend-setter on arbitration means that these new provisions are likely to be used as models worldwide.

* * *

The author, an LLM candidate at Yeshiva University’s Benjamin N. Cardozo School of Law in New York, has covered UNCITRAL’s 54th Session proceedings for CPR Speaks as a 2021 CPR Summer Intern. Her articles can be found using the search box on the upper right of this page.

[END]

UNCITRAL Completes a New Mediation Framework, Based on the Singapore Convention

By Mylene Chan

Earlier this month, the United Nations Commission on International Trade Law adopted the UNCITRAL Mediation Rules, the UNCITRAL Notes on Mediation, and the Guide to Enactment and Use of the UNCITRAL Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation. 

Judith Knieper, Legal Officer at the UNCITRAL Secretariat, at a side forum on investor-state mediation, commented that these texts complete UNCITRAL’s mediation framework, with the milestone 2018 Singapore Convention on international settlement agreements as a pillar. 

Starting in 1980, UNCITRAL began to develop a mediation framework, which now includes the following:

  • UNCITRAL Conciliation Rules (1980) (updated in 2021).
  • UNCITRAL Model Law on International Commercial Conciliation (2002) (amended in 2018).
  • UNCITRAL Guide to Enactment and Use of the 2002 Model Law (2002) (replaced in 2021).
  • UNCITRAL Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation (2018) (amending the 2002 Model Law). See page 2 of UNCITRAL Working Document 1073 here.
  • The United Nations Convention on International Settlement Agreements Resulting from Mediation (2018), commonly known as the “Singapore Convention.”
  • UNCITRAL Mediation Rules (2021) (updating the 1980 Conciliation Rules)
  • UNCITRAL Notes on Mediation (2021).
  • Guide to Enactment and Use of the UNCITRAL Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation (2021) (replacing the 2002 Guide) (available in the Working Document linked above). 

These texts provide a means for the harmonization of laws, procedural rules, and enforcement mechanisms for international mediation. The most significant tool for international commercial dispute resolution is the Singapore Convention, which enables enforcement of mediated settlement agreements among its signatories.

As a result of the adoption of the Singapore Convention, international businesses now have an effective alternative to litigation and arbitration in resolving cross-border disputes.  Judith Knieper said that 54 states had signed the Singapore Convention, and she said she hoped that more will join as many states are currently engaged in the ratification process.

The UNCITRAL Secretariat has invited CPR to participate as an observer delegation to its Working Group II deliberations, and solicited its comments on the drafts to facilitate finalizing the texts. The UNCITRAL Working Group II is composed of UNCITRAL’s 60-member states and has been developing work focused on mediation, arbitration, and dispute settlement. 

During UNCITRAL’s recent 54th session, which ran from June 28 and concluded July 16, and was held in person in Vienna, Working Group II introduced a number of updated provisions aimed at taking into account recent mediation trends and developments, including court-ordered mediation. See page 2 UNCITRAL Working Document 1074 here. UNCITRAL incorporated Working Group II’s revisions as part of the newly adopted UNCITRAL Mediation Rules.

Major updates in the UNCITRAL Mediation Rules include the following:

  • Clarify that the rules apply to mediation regardless of the process’s origin, including an agreement between the parties, an investment treaty, a court order, or a mandatory statutory provision.
  • Introduce a definition of mediation.
  • Stipulate that in a case of conflict, mandatory provisions in the applicable international instrument, court order, or law will prevail.
  • Specify that mediation commences when the disputants agree to engage in the mediation.
  • Require disclosure of circumstances regarding impartiality or independence.
  • Permit use of alternative means of communication during the mediation and of remote consultations.
  • Provide that information shared by parties with the mediator is confidential unless parties express otherwise.
  • Update the provisions governing the preparation of settlement agreements to take into account UNCITRAL’s legal framework, including the recently adopted Singapore Convention.  
  • Address the interaction between mediation and other proceedings.
  • Provide for exclusion of liability for mediators.
  • Encourage gender and geographical diversity in selection of mediators.
  • Specify that parties and the mediator should agree upfront on the methods of assessing mediation costs, with multiparty mediations shared on a pro rata basis.

UNCITRAL is expected to publish the UNCITRAL Mediation Rules and the UNCITRAL Notes on Mediation together later this year, according to a statement at the end of the session.

UNCITRAL’s work on mediation will continue with the drafting of rules and guidelines relating to investor-state mediation and with work exploring educational best practices, according to an official’s comments in a side forum, which is a lunch-hour roundtable in which UNCITRAL officials discussed topics related to UNCITRAL’s work.

Benjamin N. Cardozo School of Law Prof. Lela Love, who is chair of the International Advisory Board on Mediation for the Office of Ombudsman for the United Nations Funds and Programmes, commented about the developments reported here:

All this remarkable focus on mediation—and activity around it—heralds a new era for the dispute resolution process that ideally promotes enhanced understanding, dialogue and creative problem solving.  This may be a renaissance time for mediation—one that is very welcome in the divided and polarized time we inhabit.

* * *

The author, an LLM candidate at Yeshiva University’s Benjamin N. Cardozo School of Law in New York, has covered UNCITRAL’s 54th Session proceedings as a 2021 CPR Summer Intern.

UN Insolvency Work Finds Help with Mediation

By Mylene Chan

The United Nations Commission on International Trade Law adopted a simplified insolvency regime that recommends mediation to resolve disputes between financial sector creditors and small debtors during its 54th Session. 

The move sets out a path where mediation can be a help to debt-plagued businesses in developing and emerging countries.

Last Friday, UNCITRAL closed its 54th Session in Vienna, which began June 28. During this session, Working Group V on insolvency law finalized legislative recommendations for a simplified insolvency regime for micro and small enterprises, or MSEs, and UNCITRAL adopted it. 

UNCITRAL mandated this project in 2013 because the insolvency rules generally applicable to mid-sized and large business enterprises do not accommodate micro and small businesses, which are the driving economic force for many countries. Gregor Baer, 14:2 Insolvency and Restructuring Int’l 64 (Sept. 2020) (available at https://bit.ly/3B1peox).

As part of the United Nations’ sustainable development goals, UNCITRAL has also asked its  Working Group I, on micro, small and medium enterprises, to make recommendations to reduce legal obstacles faced by micro and small businesses in developing countries. Id.

The drafting of the simplified insolvency regime has been coordinated with the World Bank Group because the Financial Stability Board designated both the World Bank and UNCITRAL as standard setters in the field of insolvency. Financial Stability Board, Insolvency and Creditor Rights Standard (Jan. 20, 2011) (available at https://bit.ly/36EKqTi).

In light of the significant negative impact of Covid-19 on MSEs, several member states of Working Group V have expressed an urge to expedite the drafting of the simplified insolvency regime. UNCITRAL, Capital Markets Intelligence, “International Insolvency & Restructuring Report 2020/21” (available at https://bit.ly/2VBeg8P).

Ironically, because many member states have implemented insolvency-related legislative measures to address difficulties faced by MSEs during the health emergency, the pandemic has created valuable experiences that could help improve the text of the simplified insolvency regime.

The simplified insolvency regime addresses major characteristics of small debtors, such as having a non-diversified creditor, supply, and client base. See Note by the Secretariat,  “Insolvency of micro, small and medium-sized enterprises: Draft text on a simplified insolvency regime” (Sept. 28, 2018) (available at https://bit.ly/3ie53Ll).  

Other distinguishing features of small debtors covered by the simplified insolvency regime include the access to credit being subject to the grant of personal guaranties, encumbrance of physical assets, and unencumbered assets with minimal value.  In addition, the simplified insolvency regime considers small debtors’ frequent poor or nonexistent records, overlapping ownership control and management, and “concerns over stigmatisation.” See UNCITRAL, Capital Markets Intelligence, International Insolvency & Restructuring Report at 10, linked above.

The simplified insolvency regime focuses on mechanisms to bring micro and small business debtors into a formal insolvency system that provides rehabilitation and a reasonable payment plan.  Through reduced complexity of insolvency procedures, lowered costs, and more favorable conditions for a prompt discharge, small debtors could hope to have a fresh start.  See Note by the Secretariat at page 7, linked above.

Member states have proposed endorsing out-of-court and hybrid procedures to develop workable alternatives to formal insolvency processes amicable to MSEs. Report of Working Group V (Insolvency Law) on the work of its 54th session (Vienna, 10–14 Dec. 2018) p. 22 (Dec. 20, 2018) (available at https://bit.ly/3z29MGR).  

During previous drafting stages, some member states explained that certain preconditions should exist for out-of-court and hybrid procedures to be effective, such as incentives for financial institutions to negotiate debt restructuring and to suspend the debt.  Those procedures, however, were generally more suitable for large and medium-sized enterprises.

Other member states explained that in some jurisdictions, positive tax impacts of debt forgiveness are available as incentives for financial sector creditors to negotiate debt restructuring with small debtors. In other jurisdictions, administrative out-of-court procedures and mediation have yielded positive results.

In previous negotiation stages, some national delegations and development-focused non-governmental organizations suggested non-punitive rehabilitation of small debtors to promptly restore their economic productivity. See Baer, linked above.

* * *

In this month’s session, Working Group V adopted the following commentaries in the simplified insolvency regime to provide guidance that mediation could be helpful in resolving disputes relating to MSEs:  

To avoid delays and at the same time to ensure transparency and predictability, this [text] recommends that a simplified insolvency regime should provide for the default procedures and treatment that can be overridden by the decision of the competent authority on its own motion or upon request of any party in interest. The competent authority may modify the proceedings by introducing, for example, a mandatory mediation stage or displacing the debtor- in-possession with an independent professional.

Note by the Secretariat, “Draft text on a simplified insolvency regime” 38, ¶ 75. (Feb. 16, 2021)  (available at https://bit.ly/3id8IJw).

Mediation and conciliation services may also be helpful for resolution of disputes between MSE debtors and creditors and among creditors.

Note by the Secretariat, “Draft text on a simplified insolvency regime Addendum” 38, ¶ 75. (Feb. 16, 2021)  (available at https://bit.ly/3raOQKU).

* * *

The simplified insolvency regime is expected to appear as Part V of UNCITRAL’s Legislative Guide on Insolvency Law.

Developing and emerging countries, where MSEs may drive the economies, are among those hit hardest by the economic contraction spurred by the Covid-19 pandemic. Small debtors’ insolvency affects job preservation and the supply chain.

On July 16, the final day of the 54th session, Caroline Nicholas, Senior Legal Officer of UNCITRAL, commented on technical assistance activities focusing on MSEs recovery from the effects of the pandemic:  

What is really interesting to hear is the experience in three continents, in Africa, Latin America, and Asia. We have some emphasis on exactly the same points, the need for agility, the need for syndicated simplified measures and the need for speed in supporting MSEs so that they are receiving the financial and other support.

As the world is gaining control over the Covid-19 virus, mediation emerges as a potential solution to help ease the recovering path for struggling segments by bringing creditors to negotiate with small debtors. 

With the help of mediation and incentivized policies for creditors to suspend or forgive debts, perhaps many MSEs can recover their economic productivity and help developing and emerging countries restore economic and social welfare after the pandemic. 

* * *

The author, an LLM candidate at Yeshiva University’s Benjamin N. Cardozo School of Law in New York, has covered UNCITRAL’s 54th Session proceedings as a 2021 CPR Summer Intern.

[END]

United States Submits Amicus Brief in Servotronics International Arbitration Supreme Court Case

By Cai Phillips-Jones

Multiple parties have filed briefs concerning arbitration discovery rules in a case now before the U.S. Supreme Court for fall argument, Servotronics v. Rolls Royce, No. 794 (see the Court’s official docket at https://bit.ly/3ysbMrL).  

In the case, the Court will decide the question of whether federal district courts can assist with obtaining evidence in foreign arbitration cases at the parties’ request. The argument date has not yet been set.

The U.S. Solicitor General’s office in the Justice Department has filed an amicus brief advocating on behalf of the U.S. government for a narrow interpretation of 28 U.S.C. 1782, a law that has created a split among federal circuit courts. The law allows circuit courts to authorize discovery for litigation originating in “foreign tribunals,” including compelling testimony from witnesses residing in the United States. 

But circuit courts have not been able to agree about whether the law pertains to arbitration taking place in foreign countries: The Fourth and Sixth U.S. Circuit Courts of Appeals support court involvement in discovery for these arbitrations under Section 1782, and the Second, Fifth and Seventh Circuits reject this interpretation of the law.

The Fourth and Seventh Circuits both heard the same Servotronics case that is now on the Supreme Court docket. The circuit courts reached opposite conclusions. For background on the cases’ paths and how the current Seventh Circuit case made it to the Supreme Court, see Amy Foust, “The Next Arbitration Matter: Supreme Court Agrees to Decide Extent of Foreign Tribunal Evidence Powers,” CPR Speaks (March 22) (available at https://bit.ly/36cp27K), and “YouTube Analysis: What Happens Next with the 3/22 Servotronics Cert Grant on Foreign Arbitration Evidence,” CPR Speaks (March 22) (available at https://bit.ly/3jLbVT3).

CPR, which publishes CPR Speaks, submitted an amicus brief in support of the Servotronics certiorari request in January, which also was the subject of an amicus brief by the Atlanta International Arbitration Society. Since the petition was granted, 11 additional amicus briefs, including the brief of the Solicitor General’s office, have been filed.

Of the group, two state that they do no support either party–those of Prof. Yanbai Andrea Wang, of Philadelphia’s University of Pennsylvania Carey Law School, who asks the Court to clarify the scope of Section 1782, previously interpreted in the Intel case discussed below; and the International Court of Arbitration of the International Chamber of Commerce, which discusses the ICC’s international law views.

Two briefs support the petitioner, submitted on behalf of Columbia Law School Prof. George A. Bermann; and Palo Alto, Calif.-based ADR provider Federal Arbitration Inc.

Seven of the briefs support the respondent in seeking a narrow scope for Section 1782 discovery to exclude international arbitrations. In addition to the U.S. government’s brief, they include briefs submitted on behalf of China and Hong Kong-based arbitrators Dr. Xu Guojian, Li Hongji, Zhu Yongrui, Tang Qingyang, Chi Manjiao, Ronald Sum, and Dr. Zhang Guanglei; the U.S. Chamber of Commerce and the Business Roundtable; International Arbitration Center in Tokyo;  the General Aviation Manufacturers Association Inc. and the Aerospace Industries Association; Halliburton Co., which is facing a Section 1782 issue in a separate case, and the Institute of International Bankers, a New York City-based industry association of international banks operating in the United States.

* * *

In its brief, the government reviews the history of requests for discovery from foreign parties.

According to the amicus brief, prior to 1855, federal courts did not have the authority to compel a witness to testify in a case involving a foreign state party. In 1855, an act was passed by Congress to remedy this, but in a strange twist this law was subsequently “buried in oblivion” due to “a succession of errors in indexing and revising the statutes” and lost to the courts. A similar law was passed in 1877 and, in 1948, the law was broadened to include discovery for non-state parties.

In 1964, the language in the law was broadened again, applying to “a proceeding in a foreign or international tribunal” compared to the previous version’s “any judicial proceeding in any court in a foreign country.” Since then, only one Supreme Court case has discussed the scope of the law, Intel Corp. v. Advanced Micro Devices Inc., 542 U.S. 241 (2004).

The case concerned the distinction between judicial and administrative processes and whether Section 1782 applied to the latter. The Court found it applied. But recently, disagreement  has sprung up about whether the “foreign tribunal” language includes arbitrations involving foreign parties. The U.S. government has now taken the position that the law should not apply to private foreign arbitrations.

In its brief, United States argues (1) that such discovery functions were not within the scope of Congress’ intent when it passed 28 U.S.C 1782; (2) that interpreting the law to apply to international commercial arbitrations would create asymmetry with the domestic rules of arbitration incorporated in the Federal Arbitration Act; and (3) such an interpretation would create additional problems if extended to investor-state arbitration.

Noting that previous versions of the law clearly referred to only courts, the government acknowledges that the 1964 revision changed this language from “any judicial proceeding in any court in a foreign country,” to “a proceeding in a foreign or international tribunal.” This change, according to the government, and in contrast to the Fourth Circuit’s interpretation, was “only a measured expansion of the provision’s scope to capture quasi-judicial entities (such as investigating magistrates) and certain intergovernmental bodies (such as state-to-state claims commissions).” As the government points out, at the time the 1964 law was passed, international commercial arbitration was still novel, and thus likely outside Congress’s intent.

The government’s second argument discusses the incongruence of the limited discovery available under the FAA to arbitrators, in contrast to the discovery requests available to parties under Section 1782. Interpreting the law to apply to commercial arbitrations would “[allow] more expansive discovery in foreign disputes than what is permitted domestically,” the government’s amicus brief states.

While the court acknowledges that Section 1782 is not coextensive with domestic discovery rules, the “stake asymmetry” produced by a broad interpretation of the law “should [be taken] into account” in determining the law’s scope.

Finally, the government discusses a particular type of arbitration, investor-state arbitration, which gives investors who have claims against a foreign state in which they held an investment a private remedy for losses allegedly caused by the state. Arbitration in this context replaced a more time-consuming and expensive process, diplomatic protection, involving a government negotiating a resolution on behalf of one of its citizens who has suffered an economic injury.

The solicitor general’s amicus brief argues that investor-state arbitrations would be hampered by additional discovery procedures and “upset settled expectations” of investor and state parties entering contracts.

The U.S. government, in addition to filing a brief, has requested permission from the court to argue the case with the parties this fall The Court has not yet acted on the oral argument request, which is expected to be granted.

Meantime, the underlying arbitration in Servotronics has been conducted in London the week of May 10. If a decision emerges before the Court hears the arguments, the existence of an arbitration award could raise questions of mootness.

* * *

The author, a J.D. student who will enter his third year this fall at Yeshiva University’s Benjamin N. Cardozo School of Law in New York, is a 2021 CPR Summer Intern.

[END]

Arbitration for Art: Regs Seek to Provide a Better Way to Resolve Disputes

By Jacqueline Perrotta

Over the past 30 years, the Art World has become the Art Market. Selling and purchasing art has become Big Business for collectors and investors alike. In a mostly unregulated market, new regulations are emerging on resolving disputes between parties involved in art deals.

On July 13, 2020, subject-matter experts including lawyers and professors with experience in the art sector and in arbitration, gathered to form these new “Regulations on Arbitration in the Art Sector of the Venice Chamber of Arbitration” as a way to better resolve art disputes.

A January 2021 article, “Art and Arbitration: an overview in light of the new Regulations on Arbitration in the Art Sector of the Venice Chamber of Arbitration,” highlights the context of the regulations in today’s global art market, the advantages of using arbitration for art sector disputes, and the new regulations, including their importance and potential impact on how the art market resolves disputes.

Described as the first initiative of its kind in Italy, the regulations promote the use of arbitration and provide an alternatives to the Hague’s Court of Arbitration for Art, or CAfA.  Established in 2018, the Court of Arbitration for Art was founded to resolve disputes through alternative dispute resolution throughout the art market. Through CAfA, disputes can be arbitrated or mediated with the help of the Netherlands Arbitration Institute.

 Disputes that arise in art parallel commercial transactions, but with niche concerns including issues of cultural and religious sensitivity, confidentiality, and authenticity.

The use of these regulations for art arbitration comes with several upsides. The article linked above highlights a prominent advantage where arbitration is efficient and is “freely accessible”–having an arbitration clause already baked in to provide a jumping off point if a dispute arises out of difficult cultural matters or from the uncertainty of fraudulent works.

Another upside discussed in the article that comes with using arbitration is “guaranteed confidentiality,” because art-market players often are sensitive regarding “reputation and discretion,” and there is a heightened importance of privacy for collectors and dealers.

The goal of the Venice Chamber regulations is also to broaden the use and scope of arbitration to the contemporary art context and go beyond the limited definitions of national legislation.  By introducing the regulations, arbitration as a means of alternative dispute resolution is promoted as an efficient and effective way to resolve art sector disputes.

* * *

The author, a J.D. student who will enter her second year this fall at Brooklyn Law School, is a 2021 CPR Summer Intern.

[END]

Y-ADR Interview Series #5: Kelly Xing, Legal Counsel, General Motors

CPR’s new Y-ADR Interview Series returns with another discussion on in-house work, law practice development, and careers in dispute prevention and resolution.

This week, Y-ADR Steering Committee member Elizabeth Chan, an associate in the London office of Three Crowns, discusses conflict resolution with Kelly Xing, Legal Counsel at General Motors Co. in the Jing’an District, in Shanghai, China.

Kelly discusses her career path and conflict resolution experience, including how she approaches the drafting of dispute resolution clauses, and how the company uses a multi-tiered approach to dispute resolution that focuses on resolving disputes at management level.

She also talks about the business, discussing in detail the GM joint ventures she works on.

Lizzie Chan’s interview is her fifth in the CPR Y-ADR Interview series.  The previous interview, with Mathias Goh, can be viewed on CPR Speaks here. Previously, Lizzie spoke with Timothy Shore on working as an ombudsman, which can be viewed on CPR Speaks here. The second interview in the series, with CPR Y-ADR co-chair Jason Klingensmith, Assistant General Counsel, at General Motors Co. in Detroit, is available on CPR Speaks here

Lizzie’s kickoff interview in the series, with Jason’s GM colleague Brittany Mouzourakis, is available on CPR Speaks here.

You can watch the new Kelly Xing interview above, and share it on YouTube here.

CPR’s Young Leaders in Alternative Dispute Resolution educates the next generation of leaders on the full spectrum of dispute prevention and resolution mechanisms, and offers unique networking and professional development benefits to participants. Through periodic seminars and other initiatives, participants are introduced to CPR and gain an insider’s view into how CPR’s community of corporate counsel, law firm counsel, and other experts in the field are using dispute prevention and resolution techniques to manage conflict.

Y-ADR is open to the conflict prevention and resolution community–attorneys, professionals, academics and students–45 years old and younger, or those with less than eight years of professional experience in international or domestic ADR practice or other areas of conflict prevention and resolution.

The Y-ADR Steering Committee is the leadership group for Y-ADR. Jason Klingensmith’s co-chair is Ulyana Bardyn, counsel in the New York office of Eversheds Sutherland.

Follow CPR’s social media at the links at the bottom of this page for developments, and connect with Y-ADR’s LinkedIn page here.

[END]

CEDR’s Eileen Carroll: Her Mediation Story

By Antranik Chekemian

F. Peter Phillips, director of New York Law School’s Alternative Dispute Resolution Skills Program, welcomed an online audience earlier this month as part of the program’s long-running lunchtime speaker series for a session with veteran U.K. mediator Eileen Carroll.

Carroll is founder of London-based Centre for Effective Dispute Resolution, better known as CEDR, “by far the most influential and prescient dispute resolution organization not only in the U.K., but really . . .  in Europe,” said Phillips in the introduction to the Feb. 10 session, which had about 40 attendees.

Phillips invited Carroll to share her professional background and how her journey into the ADR world started.  Carroll opened describing, among other things, a long history with the publisher of this CPR Speaks blog, the International Institute for Conflict Prevention and Resolution, and recounted some of those interactions over these years.  [Phillips is a former CPR senior vice president.]

She said she was a senior litigation partner at a London law firm in the 1980s, with “good contacts” in the U.S., and she took a six-month secondment to San Francisco.  “I was one of the senior litigation partners and they asked me whether I would go and work with a firm on the west coast,” she said, “and I took myself off to San Francisco.”

She said that she decided her focus would be alternative dispute resolution. “I learned a bit about mediation from some of the research I had done, and I thought that would be my project,” she said. She noted that she was impressed by how the mediation process “extracted people from the drama of litigation.” Carroll explained:

I then was given a book called The Manager’s Guide to Resolving Legal Disputes by Henry and Lieberman.  . . . Jim Henry, based in New York, who had started . . .  CPR. He became a very dear friend, and I was going to write a book, but someone gave me his book . . . and I decided when I read that I was really fired up to do something.

James F. Henry is founder of CPR, and Jethro Lieberman is a former CPR vice president and a retired New York Law School professor.

Carroll showed the audience an article she wrote stemming from her U.S. work, “Are We Ready for ADR in Europe?” International Financial Law Review 8 Part 12, 11 (1989).

The article’s title, she said, “was a question no one had asked, and I was determined that we were going to be ready for ADR in Europe. But I knew […] that I needed to do something to get a support behind me, so I set about founding a nonprofit organization.” She added, “I did get inspiration from Jim [Henry].”

She added, “By the time we launched CEDR, I had managed to get with the help of others–80 big companies to support the idea–[and] the major law firms in London didn’t want to be left out, so they thought they better support the idea.”

Philips jumped in and mentioned that CEDR’s story was similar to the CPR Institute’s origin in the U.S. “It wasn’t as if the idea was ‘Let’s take mediation and convince people of it’ so much as it was ‘Let’s take a core of leading owners of disputes–leading corporations, people who spend a lot of money litigating–and convene them so that they become the torchbearers,” said Phillips, adding, “They became the people who are convincing their peers.”

Carroll said that the ties to North America in her work continues, citing current work with the International Academy of Mediators. [CPR and CEDR continue to collaborate on seminars and trainings. Information on the next scheduled joint training–a four-day advanced mediation skills training seminar that begins April 19, in which the organizations will be joined by the Silicon Valley Arbitration & Mediation Center, is available on CPR’s website here.]

Philips asked Carroll about the role of emotion in commercial mediation, noting “the challenge to determine the extent to which . . . the expression of emotion in a commercial context is helpful.”

Carroll said, “In every conflict, there is emotion–people are upset in some way or other. Whether it’s because they have been avoiding it, whether it’s anger, whether it’s anxiety, all of those emotions I find present, and they display themselves in different ways, because we all have different kinds of personalities.”

She stressed the importance of “creating an environment where people can tell whatever their story is.” She stated that a mediator’s job is not to patronize but to notice the parties’ emotions and feelings, and explore them at the right moment with the right questions.

Carroll further emphasized that there is not a uniform approach in mediation. “There may be several working sessions with different people,” she said, “so to deal with these emotions, you have to go at it carefully without too many assumptions and create the space to get to know the people that you’re going to work with.”

Phillips then asked Carroll about the challenges women encounter in ADR. “When you were a practicing lawyer, you were very frequently the only woman in the room,” he said, “In the early days of ADR, you were very frequently one of the very few women who was making a go of it,” he said.

She emphasized that because law firms usually advise their clients during the mediator selection process, “they often follow the same kind of pattern of three names.” She expanded:

When l look back to the beginning of the field when we first started, . . . there was just a sense that we need people with status, people with experience, so at that point people were kind of looking to, ‘Who were those senior people?’ And the legal profession, even in the early 90s, a lot of those people were men. It is changing. But . . . those who were early entrants to the field obviously got . . . a reputation. [If they] were good mediators and good arbitrators who were around in the mid-90s, some of those people still have incredibly effective practices today.

Phillips then asked Carroll about a recent CEDR report that discussed “how female mediators view their strengths as opposed to how male mediators view their strengths.” [CEDR’s current research can be found here.]

“[W]omen recognized that they were good at relationships and empathy,” said Carroll, recalling the research, “and a lot of guys obviously have that experience, but . . . a lot of the men saw themselves as more as getting the deal done, much more transactional.”

Carroll then referred attendees to a Simon Baron-Cohen’s 2012 book, “The Essential Difference: Men, Women and the Extreme Male Brain, which discusses these issues.

“Women do have some very natural abilities in relation to communication skills and they have done work with babies, boys, and girls . . . and the way they react.  . . . So, women have a lot of natural skill in the area of mediation which I think sometimes they underplay because if you look at in life, women often have the role of having to make . . . all the relationships work within a family, sometimes in an office,” said Carroll.

Emphasizing the need for diversity, she concluded, “Women absolutely have the capability to do any tough mediation, because they have got the intellectual skill, they understand the background of the problem. There is no reason why there could not be as many successful commercial women mediators as men. I think it’s something about the filter of the selection process, which I think is changing.”

“All the business people I have worked with through the years in mediation, I have never had a problem,” said Carroll.  “Over time,” she continued, “I have never . . . felt any concern in dealing with business people about the role of the woman mediator. Never. I would not say that was always the case in relation to certain members of the bar.  . . . I have always managed to walk around it. It hasn’t been a problem.”

She concluded her presentation discussing instilling “patience and persistence” into mediation to make it successful.

* * *

Eileen Carroll’s presentation is archived at the NYLS ADR Program link above and directly on YouTube here.

* * *

The author, a second-year student at New York’s Benjamin N. Cardozo School of Law, is a CPR 2021 intern.

[END]