CPR’s new website now hosts the CPR Speaks blog. You can find new posts, at https://www.cpradr.org/news/cpr-speaks.
Mediation
The ADR Legacy of CPR’s Founding Father, James F. Henry–In Memoriam
Jim Henry
CPR’s founder, James F. Henry, has passed away.
He leaves behind a legacy trailblazing the use of methods other than litigation to resolve business disputes. His impact is immeasurable. He is responsible for promoting processes, techniques, and tools for alternative dispute resolution for major business conflicts, and expanding its use by lawyers throughout the world.
He founded and then served as president and chief executive officer of CPR, overseeing its initial initiatives with a group of in-house counsel to later include law firm practitioners, academics, and international firms and partner organizations, from CPR’s inception until his 2000 retirement.
Even after his retirement, he continued to advocate for better dispute resolution, writing–including in Alternatives to the High Cost of Litigation, which he founded in 1983 (and for which he served as publisher during his CPR years)–and occasionally speaking.
CPR established the James F. Henry Award in 2002. It honors outstanding achievement by individuals for distinguished, sustained contributions to the field of ADR, based on their leadership, innovation and sustaining commitment to the field.
“We’re all privileged and humbled to be walking in Jim Henry’s footsteps,” said Allen Waxman, CPR’s president and chief executive officer since 2019. “He foresaw in a way many others did not the need for business to find better ways to resolve their conflicts than what court systems might offer. He was a maven for innovation, pushing for greater creativity, efficiency, and fairness in ADR processes. We are all beneficiaries of his work and leadership.”
Henry died on Aug. 28. He had lived in Waccabuc, N.Y., where he resided for seven decades. He was 91.
Henry’s family has announced a celebration of his life on Sunday, Nov. 13, at 3:00 p.m., in Waccabuc. They have asked that if you are able to attend, please let the family know so that they can send you an invitation. The contact is Stephen Henry at shenry@henrylacey.com.
Henry founded CPR in 1977 to continue previous foundation work on social justice issues that included studying poverty, Native American issues, and tropical disease eradication. In due course, it became the Center for Public Resources (later to change to the International Institute for Conflict Prevention and Resolution); its subject focus was business ADR. His delivery devices included new sets of conflict resolution rules, tools, initiatives and programs. (A timeline of Henry’s and CPR’s history is available on CPR’s website here.)
Initially, he and the organization championed mediation and negotiation. He strove to have lawyers talk first before marching to courts. That resulted in the mid-1980s in CPR’s signature “Pledge,” the Corporate Policy Statement on Alternatives to Litigation. (See background and text https://bit.ly/3CDmyjH.) Under the nonbinding pledge, a company agrees that it will consider—and be ready to negotiate–a resolution with the dispute resolvers at its adversaries.
The pledge idea spread from CPR to companies throughout the legal world. It became CPR’s signature effort in the 1980s. Thousands of big companies and subsidiaries signed on.
That led to a similar pledge for law firms—that they would discuss with the clients in appropriate case the use of ADR. Industry commitments followed, in which groups of businesses agreed to resolve, by negotiation or mediation, specific disputes that arise among the competitors within those industries. (The pledges and commitments can be seen here.) Similarly, Henry spearheaded efforts at CPR to bring together academics and attorneys at all levels to translate theory into effective practice.
The resonance of Henry’s CPR pledge continued well after his retirement, and continues today. In 2012, a “21st Century Pledge” modernized the idea to institutionalize the pursuit of corporate ADR systems.
CPR has continued this tradition of pledges seeking innovation in dispute management by recently establishing a pledge that businesses will consider incorporating mechanisms into their arrangements with others, not just to resolve disputes, but prevent them altogether. See CPR’s Dispute Prevention Pledge for Business Relationships (revised April 5, 2022) at www.cpradr.org/resource-center/adr-pledges/dispute-prevention-pledge-for-business-relationships.
The pledge didn’t stand alone at CPR, even in the mid-1980s. With the assistance of the late Harvard Law School Prof. Frank E.A. Sander, Henry established the CPR Awards (go here for details on this year’s awards-entry deadline next month and submission instructions), to recognize but also to incentive business and academic development of the processes and systems that CPR began to produce, including nonadministered arbitration rules and guidelines for establishing and using minitrials.
Those resources and materials, and many others including international and translated versions, are still vital, and can be found on CPR’s website at https://bit.ly/3ryxCID. (Sander became the longest serving member of Alternatives’ editorial board, from its 1983 inception until his death in 2018.)
Henry correctly projected that private ADR forums initiated by companies and industries would continue to proliferate after CPR’s 1980s work. He cited and worked to expand corporate dispute resolution programs ranging from employment settings to case management. He later worked with court administrators on programs that impacted the installation of ADR offices by Presidents George H.W. Bush and Bill Clinton in the 1990s in every federal court in the nation, as well with executive branch government ADR officials. And he expanded CPR’s initiatives to arbitration rules and ethics standards for ADR providers and practitioners.
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Henry’s principle delivery system, however, actually was the lawyers themselves.
Exhibiting a lifelong devotion to improving society through law, Henry continually emphasized best practices in lawyering. He had confidence that excellent legal skills would bring the informal dispute resolution processes that had been performed for years to a valued place in legal operations and management.
Henry set out to assemble those people, and make them available to disputes. CPR Dispute Resolution has grown its Panel of Distinguished Neutrals to more than 600 neutrals today, and has addressed cases valued in the billions of dollars.
Henry saw the work of lawyers as the key to ADR success, as well as CPR, a New York-based nonprofit. He was a tireless cheerleader throughout his tenure as CPR’s president and CEO until his 2000 retirement for bringing out the best in the legal profession, and making ADR skills a requirement.
That in turn created a network of devotees to, and members in, what came to be known in the mid-1990s as the CPR Institute for Dispute Resolution, ahead of the current name that added the international perspective begun under Henry. CPR members have led in the use of commercial conflict resolution for their clients’ problems, both in house and at law firms, world-wide.
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Jim Henry was born in 1930 in Grand Rapids, Mich., and attended Williams College. He later served as a U.S. Army Intelligence Officer, and was awarded law degrees from the Georgetown University Law Center in Washington, D.C., and the New York University School of Law.
CPR President Allen Waxman said, “On behalf of the board and staff at the International Institute for Conflict Prevention and Resolution, we send deepest condolences to Jim’s wife, Susan Henry, and their three children and eight grandchildren.”
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The November issue of Alternatives to the High Cost of Litigation has published an expanded version of this tribute to Jim Henry’s life. See CPR News, 40 Alternatives 154 (November 2022) (available at https://bit.ly/3DgLuMV). An archive of Henry’s Alternatives feature articles can be accessed directly on the Wiley Online Library at https://bit.ly/3ylmkLs.
[END]
CPR Amends Its Employment-Related Mass Claims Protocol
The International Institute for Conflict Prevention and Resolution has announced amendments to its Employment-Related Mass Claims Protocol–the ERMCP or Protocol.
The ERMCP provides an innovative mechanism for more efficient and effective resolution of a mass of employment-related cases. The Protocol features a “Test Case Process” followed by a global mediation process informed by the Test Cases.
The ERMCP incorporates CPR’s Administered Employment Arbitration Rules.
An initial set of revisions to the Protocol by a CPR Task Force comprising leading counsel from the plaintiff’s bar, in-house employment counsel, corporate defense attorneys, and neutrals (arbitrators and mediators) was produced in April 2021 in connection with the release of the CPR Administered Employment Arbitration Rules (see CPR Speaks (April 14, 2021). A second set of revisions that, among other things, incorporated CPR’s Due Process Protections, and makes changes to align with CPR’s updated Diversity Commitment, was promulgated in October 2021 (see CPR Speaks (Oct. 14, 2021).
The just-released Version 2.1 ERMCP amendments arise from CPR’s administrative experience under the Protocol. These changes relate to payments under the Protocol as well as additional clarifications on timing and the opportunity to mediate cases outside the mediation process.
CPR has added a requirement that, subject to any applicable fee waiver, claimants pay a part of the appointment fee as specified on the CPR Fee Schedule, which, in keeping with CPR’s Due Process Protections, will in no event be greater than the court fee required to file an action in a court of competent jurisdiction at the place of arbitration, or if none is specified, in the county of the claimant’s primary place of residence.
The Protocol also specifies that the appointment fee from both the claimant and the respondent in a particular case must be received by CPR prior to provision of a slate of candidates for that case. See Paragraph 4 of the Protocol here and the CPR Fee Schedule for details.
In light of questions received, Version 2.1 also makes clear that the parties may engage in a mediation (other than the ERMCP) at any time during the mass claims process, including during the Test Cases. It provides that any such mediation will be administered by CPR under the CPR Mediation Procedure. (See Footnote 21 of the Protocol.)
In response to other questions, Protocol Paragraph 6 also clarifies that the parties may jointly request an abeyance in connection with a mediation or otherwise of any pending arbitration. If an arbitrator has been appointed, the arbitrator will decide whether to approve such request.
CPR Dispute Resolution Services Senior Vice President Helena Tavares Erickson noted, “We always seek to improve on our innovations as we learn from experience and always welcome and appreciate the feedback provided by the users of our services and products.”
FAQs for the new ERMCP 2.1 can be found here.
[END]
CPR Council Meeting: Abraham Lincoln and Dispute Resolution
By Xin Judy Wang
The June 22 CPR Council meeting featured a presentation on Abraham Lincoln and dispute resolution by the International Institute for Conflict Prevention & Resolution’s former CEO & President Thomas J. Stipanowich, the William H. Webster Chair in Dispute Resolution and a law professor at the Straus Institute at Pepperdine University’s Caruso School of Law in Malibu, Calif.
He served as CPR’s president and CEO from 2001 to 2006, and returned to discuss his project, “The Lincoln Way: Abraham Lincoln as a Problem Solver and Manager of Conflict.”
Stipanowich began his presentation discussing the United States’ fascination with Lincoln, the 16th president. Possibly the nation’s most familiar historical figure along with George Washington, Lincoln lived one of the most documented and written-about lives from the nineteenth century. Almost everyone feels some level of familiarity with Lincoln, attaching him to particular principles, life experiences, or lifestyles. Lincoln was also a self-taught lawyer who worked on a broad spectrum of cases ranging from pig-stealing incidents to representation of railroads.
Stipanowich said he was attracted to Lincoln’s legacy through a telling quote: “Discourage litigation. Persuade your neighbors to compromise whenever you can. As a peacemaker the lawyer has a superior opportunity of being a good man. There will still be business enough.” The quote came from Lincoln’s lectures to fellow lawyers around 1850, many of whom were trial attorneys.
From this quote, Stipanowich saw a striking similarity between Lincoln’s peacemaking spirit and CPR’s mission to reduce conflict to enable purpose.
As Stipanowich’s project title suggests, Lincoln was a lifelong problem solver and a conflict manager.
Lawyer Lincoln encouraged fellow trial lawyers to discourage litigation and always sought ways to resolve conflict out of the courtroom to avoid the often-unsatisfactory result through trials. Stipanowich found evidence that Lincoln was an informal mediator and had served as an arbitrator. Once, he organized a minitrial with a judge outside the court, with the judge rendering a nonbinding decision that settled a dispute without going to trial.
Stipanowich found Lincoln recognizing that, especially for reputational conflict–a popular type of suit at the time–going to trial is not the best way, whether one is representing the plaintiff or the defendant. It was better to reach a negotiated settlement privately.
As a politician, Abraham Lincoln navigated across party lines to achieve resolutions in the context of a mega-negotiation to address every stakeholder group. He had contacts in different parts of the country, reaching out to border states and southern politicians. It was his awareness of changing circumstances that led to his campaign leading to the Emancipation Proclamation. The African American community’s support was critical for restoring the union as a growingly important constituency and a necessary force in the military.
As an individual, Lincoln wrestled with internal conflict on self-image, religion, and relationships. Stipanowich found Lincoln to be tremendously influenced by reading the autobiography of Ben Franklin as a teenager, thus developing an enduring rationalist spirit. Lincoln was clear in his mission and ambition: “Every man is said to have his peculiar ambition. Whether it be true or not, I can say for one that I have no other so great as that of being truly esteemed of my fellow men, by rendering myself worthy of their esteem.” In pursuit of such honor and respect, Lincoln wrestled with depression, a broken engagement, and an avoided duel.
Through navigating conflicts and periods of crisis stemming from his internal and external conflicts, Lincoln built and rebuilt a transformational leadership. Lincoln’s rational, problem-solving spirit is just as relevant today for lawyers, corporations, and interested parties. In Stipanowich’s 2009 article, “Lincoln’s Lessons for Lawyers,” he summarized Lincoln’s legal practice principles:
- Use litigation as a last resort—and be frank with your client about its costs and risks.
- Try to be objective in assessing your client’s case; avoid “irrational optimism.”
- Begin negotiating cooperatively and encourage the reliance of others by behaving in a logical and predictable way. Look for trade‐offs.
- Seek creative ways of bridging the gap to an agreement that achieves a client’s key goals and priorities in a simple, straightforward manner.
- Do not place your own financial interests or ego above the interests of the client.
Thomas, Stipanowich, “Lincoln’s Lessons for Lawyers” Dispute Resolution Magazine 18 (Feb. 1, 2010) (available at https://bit.ly/3INyalO).
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The CPR Council, the governance body of the CPR Institute, promotes the practice of more efficient and effective dispute prevention and resolution. It oversees the development of dispute management resources and tools. The Council’s web page is available at www.cpradr.org/about/cpr-council.
In addition to Tom Stipanowich’s presentation, the June 22 Council meeting also discussed the updated Council Charter, new Council programming, CPR Dispute Resolution Panelists, CPR’s new Immediation Platform for dispute resolution services, and the revised CPR Diversity Commitment. The meeting concluded with a networking session.
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The author, who will be a second-year student at Columbia University Law School in New York this fall, is a 2022 CPR summer intern.
[END]
Judges as Mediators, and the Issues that Won’t Go Away
By Mnotho Ngcobo
If you were to ask a layman what mediation is, the answer would probably be something along the lines of, “a private dispute resolution process where an independent private mediator would attempt to assist parties to reach an agreement/solution to whatever dispute they may be facing.”
But one of the problems with the typical layman’s mediation view is that it doesn’t account for a continually emerging group of individuals working their way into this ADR process–the judicial officers, including judges and magistrates (and noting that different countries have different names for these officials).
Often, parties go to mediation to avoid facing a judicial officer. That’s arguably the best part about ADR . . . or it used to be. Judicial officers are employed to adjudicate disputes. They are trained to uphold law and rules, while private mediators are specialists trained to facilitate disputes–they aren’t primarily focused on procedure, for example, because mediation by its nature is flexible and not rule-based.
What happens when a judicial officer AKA a judge mediates a case? What issues does it raise for the parties in disputes?
The truth is that parties often fear judicial officers, and when a judicial officer is facilitating a mediation, parties might not be comfortable. There is then a risk that a party would agree to something out of fear: What happens when the same judicial officer who facilitated the mediation between the parties is tasked with running the fairness hearing? This could cause problems, and some might cry “judicial overreach.”
An interesting case where the judicial officer facilitated the mediation and was also tasked with running the settlement agreement’s fairness hearing was decided earlier this year in McAdams v. Robinson, 26 F.4th 149 (4th Cir. Feb. 10, 2022)(available at https://bit.ly/3aECNBO).
This case arises from a class action lawsuit against Coppell, Texas, finance company Nationstar Mortgage LLC, alleging that Nationstar was in breach of the state and federal consumer protection laws, failing to timely acknowledge receipt of class members’ loss mitigation applications, respond to the applications, and diligently obtain documents to process them.
The case was litigated over six years. In 2017, a Maryland-based U.S. District Court judge referred the case for “Settlement or other ADR conference” before Magistrate Judge Timothy J. Sullivan, of Greenbelt, Md. In March 2020, the parties were ordered to conduct mediation. In June 2020, the parties filed a notice of settlement and a joint motion to proceed before the magistrate judge who had mediated the settlement. Among other things agreed upon in the proposed settlement agreement was that Nationstar would pay a $3 million relief fund, consisting of:
- Administrative expenses up to $300,000;
- Attorneys’ fees;
- A service award to the class’s representative; and
- Class claims.
Any remainder, the Fourth Circuit opinion noted, would go to a nonprofit that advocates for consumers. In exchange for the settlement relief fund, all claims against Nationstar would be released.
The magistrate granted the preliminary approval of the settlement agreement and scheduled a fairness hearing.
Petitioner McAdams, who had filed suit against Nationstar in a California action, filed an objection to the proposed settlement agreement. She maintained that the class notice was insufficient; the settlement was unfair, unreasonable, and inadequate; the release was unconstitutionally overbroad, and the attorneys’ fee award was improper.
Objection Overruled
The magistrate judge who mediated the case overruled McAdam’s objections and held that the distribution of the notice was sufficient; the settlement terms were fair, reasonable, and adequate; and the release was not too broad. The magistrate also went on to approve the $1.3 million attorney’s fee.
On appeal, the Fourth U.S. Circuit Court of Appeals affirmed in a unanimous opinion by Circuit Judge Albert Diaz.
The appeals court did not deal in detail with the issue of the magistrate judge having a dual role, as both a mediator and the judge approving the settlement.
Yet petitioner McAdams attacked the magistrate judge’s jurisdiction, holding that she did not consent to have the magistrate judge hear her case. Federal law provides that with the “consent of the parties,” a magistrate judge may conduct “any or all proceedings . . . and order the entry of judgment.” 28 U.S.C. § 636©(1). McAdams argued that the word “parties” includes her as an absent class member.
But the appeals court rejected McAdams’s assertion and held that absent members are not ‘within the contemporary meaning of the term “parties” as used in § 636.
McAdams also argued that this case presents a serious conflict of interest because the magistrate judge both mediated and approved the settlement agreement. The panel noted that it did not deal with this issue because McAdams did not “support that assertion” nor “preserve [it] for appeal.” The opinion states that McAdams did not move for the magistrate judge’s recusal or otherwise object. For those reasons, the Court did not deal with the conflict issue.
The Fourth Circuit has addressed with the issue of objector requirement in 1988 Trust for Allen v. Banner Life Ins. Co., 28 F.4th 513 (4th Cir. 2022) (available at https://bit.ly/3o47kvZ). In the case the objector argued that there was no burden on its part to show that the settlement was unfair, but rather the burden rested on the parties that sought settlement approval. The appeals court rejected this argument and held that the objector must clearly state its case to allow the other parties to fully respond and for the court to evaluate the issues. The court held that it is only when a sufficiently specific objection has been made, that the parties seeking settlement approval have the burden of proof.
The objector, like McAdams, failed to support it arguments.
The McAdams case creates severe implications for the absent class members. It may seem like the courts afford them less protection. Class actions not only affect the rights of the named plaintiffs, but also the rights of the absent class members. The court must play a major role in ensuring that the rights of all class members are recognized and protected.
The McAdams appeals panel held that absent class members are not parties to the action within the meaning of section 636(c), and, therefore, absent class members do not need to consent should the named plaintiff and defendant file a consent.
Removing and/or limiting such a right should be accompanied by some form of protection. This means that McAdam’s conflict-of-interest argument plays little to no role in this case since she, and others in her position, cannot object nor consent as absent class members.
The Magistrate’s Dual Role
Presiding judicial officers have long been performing this dual role of mediating and approving settlements. Some scholars argue that this dual role improves access to justice–in that there is no need to hire a private mediator, thus reducing costs for the parties involved.
Others counter that the dual role creates a conflict of interest. A judicial officer who mediated a case might be biased once the official has to decide on the same matter at a fairness hearing.
One of the biggest and most persistent issues is that a judicial officer determined to settle a case “has enormous power to coerce a settlement.” Patrick E. Longan, “Bureaucratic Justice Meets ADR: The Emerging Role for Magistrates as Mediators,” 73 Neb. L. Rev. (1994) (available at https://bit.ly/3z8fPMQ). The court can instill in the parties a fear of retaliation which would make going to trial unappealing.
Lawyers representing their clients before the judicial officer serving as a mediator might feel compelled to urge clients to accept whatever the judicial mediator is saying to avoid alienating the court, or be on the wrong side of the judicial officer, which would make their future cases before that judicial officer hard.
So while it may seem like a good idea to have judicial officers serve as mediators, it still can create some problems. A judicial officer who mediates a case might have his or her objectivity questioned later because, during mediation, parties will disclose information and the mediator would weigh in on that and might even advise the parties of the cons of going to trial. The judicial officer runs the risk of being committed to one view of the case.
The risks of judicial officers serving as mediators far outweigh the benefits. In McAdams, the argument of conflict of interest could have been avoided if a different judicial officer had decided on the fairness hearing. The moment the magistrate judge ran the fairness hearing, the conflict arguments advanced above were triggered.
As McAdams demonstrates, the area continues to be one of intrigue both for case management efficiency, and the problems inherent in its use. See a new article on the topic at Melissa B. Jacoby, “Other Judges’ Cases” NYU Annual Survey of American Law, Vol. 72, 2022 Forthcoming, UNC Legal Studies Research Paper (June 30, 2022) (available at https://bit.ly/3cj2PuY).
For more on McAdams, see Donald L. Swanson, “Judicial Mediator Serving As Deciding Judge In Same Case: An Overreach? (McAdams v. Robinson)” mediatebankry blog (Feb. 22, 2022) (available at https://bit.ly/3aEY3HC).
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The author, a South Africa attorney who received his LLM in dispute resolution from University of Missouri-Columbia Law School in May, is a 2022 CPR Summer intern.
[END]
The EEOC Set to Release Two Reports Comparing Online and In-Person Mediation
By Mylene Chan
The U.S. Equal Employment Opportunity Commission, a federal agency which enforces federal workplace anti-discrimination laws, will release Tuesday two reports on the transition to video mediation from traditional in-person sessions during the course of the pandemic.
The reports’ striking positive view of online ADR points to continued use, post-pandemic.
The EEOC had conducted about 10,000 mediations annually in the past decade–in-person until mid-March 2022, when it transitioned to online dispute resolution due to the Covid-19 outbreak. See “EEOC Mediation Statistics FY 1999 through FY 2020,” at https://bit.ly/38VirmT.
In September 2020, the EEOC commissioned researcher E. Patrick McDermott, a professor of management and legal studies of Franklin P. Perdue School of Business at Salisbury University in Salisbury, Md., with Ruth Obar, a program evaluation scholar based in Manila, Philippines, to conduct an online dispute resolution survey to measure the performance of online mediation against in-person processes.
This survey used the same performance measures employed in previous surveys by the EEOC since 2000 annually to measure participant satisfaction with in-person mediation.
“Our two independent studies of the mediator and participants’ experience in online mediation, which includes party representatives, leave no doubt that we are seeing the rise of a new and improved model of workplace discrimination mediation,” said McDermott. He added, “Without a playbook, the EEOC mediation program National Coordinator, Stephen Ichniowski, the District Office ADR Program Managers, and the many program mediators transitioned successfully from in-person to online mediation. This program’s success and the data should be considered in future dispute resolution design in the courts, administrative agencies, and private models.”
The new releases covering the two studies, “Equal Employment Opportunity Commission Mediators’ Perception of Remote Mediation and Comparisons to In-Person Mediation” and “The Equal Employment Opportunity Commission Mediation Participants Experience in Online Mediation and Comparison to In-Person Mediation,” are expected to be released here Tuesday morning. [UPDATE: The studies were released Wednesday, June 1, and can be accessed directly here.] They indicate that most of the survey participants prefer online mediation over in-person mediation, and that they believe procedural fairness, distributive justice, and access to justice are greater in online mediation.
Here are the key findings:
- 92% of charging parties and 98% of employers would conduct EEOC online mediation again.
- 86% of charging parties and 94% of employers believe that EEOC’s online mediation procedures are fair.
- 82% of charging parties and 91% of employers regard the overall online mediation as fair.
- 60% of charging parties and 72% of employers are satisfied with the outcome of the online mediation, a rate higher than the same measure taken for in-person mediation previously.
- Nearly 70% of the participants prefer online mediation to in-person mediation.
- Online mediation affords significantly greater access to justice because employers are more willing to participate in a mediation done online.
- Employers report higher satisfaction across procedural and due process measures in online mediation.
The EEOC’s results echo and confirm the views of many practitioners who find Zoom mediation to be a successful model.
John M. Noble, a Greensburg, Pa., mediator who reports he had 267 2021 mediations, shared his positive experience with Zoom:
Having conducted 564 remote sessions in the first 26 months of this Covid era, the mid-2020 notion that in-person ADR is still “better” than Zoom is now near non-existent. The non-travel benefits alone have proven life-altering: when the session is over, you are home or in the office; no more hotels or trains, planes and automobiles; no weather/dangerous highway issues; plaintiffs are expressly more comfortable in their own homes; defense representatives markedly increase efficiencies–at no added costs–participating from their home or office work-stations, given the routine in-person session down-time.
The participants and shared documents are “closer” to me on screen than in-person and I hear better with the head-set. Remarkably, while five of the eight insisted-upon in-person sessions I reluctantly conducted in 2020-22 did not settle (two of the cases saw no offers!), I have seen record numbers of settlement dollars accepted remotely-over $450 million and counting. Frankly, my location has become irrelevant as I now Zoom with people from any time zone and I very thankfully no longer travel 12-20 hours a week. Beyond sold: . . . remote ADR is here to stay!
Colin Rule, chief executive officer of Resourceful Internet Solutions Inc., which owns mediate.com, commented,
Zoom has revolutionized the practice of mediation. Many mediators conducted their first online mediation via Zoom during the pandemic, and now they won’t go back. Video conference mediation has become the new normal, with face-to-face processes the exception–a complete reversal from pre-2019.
Zoom-based mediation helps parties be at their best; it allows for more flexible mediation processes (with more breaks), and it’s much greener (with fewer car miles and airline flights). Parties prefer Zoom for mediation because of the cost and convenience, and studies are showing mediation over Zoom is equally as effective as face-to-face mediations. Zoom is constantly improving their platform, and video and audio quality are certain to get even better over the coming years. Zoom may be the gateway to more technological innovations for mediation in the near future.
Other mediators see advantages and disadvantages of online mediation and will use it if needed . . . but do not prefer it. See, e.g., Robert A. Creo, “The Post Pandemic Compromise: Hybrid Mediation!”, 39 Alternatives to the High Cost of Litigation 111 (July/August 2021) (available at https://bit.ly/3wQaxmZ).
The two EEOC reports confirm that online mediation is widely accepted by mediators and participants. Online mediation, which was initially deemed as a temporary fix, is likely to continue to become mainstream at the EEOC even after the pandemic recedes.
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The author is 2022 Founders’ Fellow of Mediators Beyond Borders International. She is a former CPR intern, and has written for and contributed to this CPR Speaks blog and CPR’s newsletter, Alternatives to the High Cost of Litigation.
[END]
Mediating Commercial Disputes: Understanding the Process to Maximize the Benefits
By Mia Levi
Mediation is a process in which a neutral third party—a mediator—meets with the disputing parties and actively assists them in reaching a settlement. Mediation is private and confidential, flexible, and more informal than other processes such as arbitration or litigation. It is concluded expeditiously, allowing parties to settle the dispute or narrow their issues at moderate cost. The overwhelming majority of disputes in mediation (70% to 80% of commercial disputes) settle, and because the outcomes are mutually agreed upon, they have high rates of compliance.
Mediation is able to preserve relationships because the emphasis is on the interests of the parties—process flexibility allows the people involved to find the best path to agreement. Parties may adapt the procedure to their own needs and can explore a wide range of remedies that might not have been available to them in court. It’s also more predictable than a trial decided by a judge or jury, avoids a “win or lose” outcome, and allows for an amicable resolution that may preserve the parties’ relationship. The goal is to resolve problems in a principled fashion (or reach an impasse) and move on.
But often, parties may be hesitant to agree to mediation. This can be remedied by understanding which kinds of disputes are suitable for mediation, when to schedule the mediation so that it is most successful, and, finally, how the mediation process itself works.
Is the Dispute Right for Mediation?
It is possible that the dispute at hand is not suitable for mediation. The ADR Suitability Guide, published by the International Institute for Conflict Prevention & Resolution (CPR), outlines three factors parties should consider in deciding the suitability of a case for mediation: (1) the parties’ goals for managing the dispute, (2) the suitability of the dispute for a mediation process, and (3) the potential benefits of mediation in relation to the specific dispute being considered.
First, looking at the parties’ goals, if there is a desire to maintain a working relationship, maintain control over the outcome, limit costs and disruption, and maintain privacy, then mediation may be a preferable tool. Second, for the dispute to be suitable for mediation, there should be no deep desire for vindication or revenge by the parties, no need to attain legal precedent, and no extreme power imbalance. Third, the potential benefits of mediation include allowing the parties to explore mutual needs and interests confidentially, providing an opportunity to be heard, providing a “reality check” for internal decision makers, helping to clarify the issues, and providing the opportunity to have an intermediary help frame proposals and present offers and counteroffers. Parties should weigh all these factors in making the decision to mediate.
Among dispute resolution processes, mediation offers a maximum degree of confidentiality and privacy. Contractual and legal protections provide additional assurances against the use or disclosure of mediation statements or documents. These confidentiality protections contrast sharply with the public nature of the litigation process and its procedures that encourage public disclosure. If parties are looking to attain a ruling that will contribute to legal precedent or require articulation of public policy, mediation likely is not the proper forum.
When Should Parties Mediate?
There is no one right time to conduct a mediation. Including a mediation step (prior to arbitration or litigation) in the proceedings is an easy way to ensure that the parties discuss settlement options. When mediated, many cases are settled or partially settled at the initial stages of the case. Settling even part of the dispute up front can make the arbitration hearings or litigation shorter and less expensive. The opportunities to reduce the costs and wear and tear of court proceedings are greatest before litigation has commenced, but mediation may be a sensible option at any point in the litigation process, even while an appeal from a trial court judgment is pending. Parties not ready for mediation at the outset of the case may be more receptive as it runs its course.
Indeed, the timing of mediation may be rendered somewhat inflexible when parties contract for a sequential, multistep dispute resolution. While tiered dispute resolution clauses may get parties to the mediation table, these provisions may not assist parties in achieving this goal at an ideal time in the life of their dispute. Some parties may find it more beneficial to mediate their dispute after some discovery has been exchanged. Parties should continuously keep an open mind as opportunities for settlement arise throughout the proceedings. It is not uncommon for cases to settle during or even after the hearings. Sometimes, an additional mediation session after some discovery is effective in reaching a settlement.
For those parties contemplating mediation in conjunction with arbitration, the Concurrent Mediation-Arbitration Clauses and Protocol, which CPR introduced in July 2020, allows the parties to agree they will attempt to settle any dispute that is the subject of arbitration by confidential mediation conducted during the pendency of the arbitration. This process was developed to encourage the availability of mediation to parties in a more flexible manner than is provided under standard multistep dispute resolution provisions. This, in turn, creates an opportunity for parties to continue to explore settlement options based on what they learn during the arbitration proceedings and without delaying those proceedings.
What Should the Parties Expect from Mediation?
Parties who have not written mediation into their contract or dispute resolution clause may need to execute a submission agreement—essentially an agreement to submit the dispute to mediation with an alternative dispute resolution (ADR) provider—or they may agree to mediate in an ad hoc process. Notably, an ADR provider will be able to assist the parties in selecting the appropriate mediator for their dispute.
Many ADR institutions provide opportunities for parties to further streamline the mediator-appointment process. For example, streamlined mediator appointment is suitable for disputes where the parties wish the ADR provider to choose a mediator for them. Parties submit information about their dispute and the candidate sought, and the ADR provider will make the selection based on the information provided by the parties and vet the candidate for conflicts purposes before the appointment. This streamlined process lowers administrative costs and allows the parties greater speed in getting a mediator appointed and the process underway.
The process itself will depend on the mediator selected. Mediators will have different styles of mediation. On one side of the spectrum, facilitative mediators will work with parties to find creative solutions that meet the interests and needs of the parties. This will be beneficial for cases where parties wish to continue a personal or business relationship. On the other side, evaluative mediators will offer an opinion regarding the relative strength of each side’s legal arguments and generally will predict the likely outcome if the parties were to bring the case to trial. Mediators may also offer a hybrid style, combining the two.
Conclusion
Understanding the mediation process will help parties gain more advantages from the mediation itself. It is important for parties to realize that while settlement of their dispute might be the most desired outcome, an impasse does not mean that the parties have failed. If parties narrow the issues, understand the opposing side’s point of view, or simply have an opportunity to be heard, it will be successful for the parties in the long run.
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Mia Levi (mlevi@cpradr.org) is the Vice President of Global Development for Dispute Resolution Services of the International Institute for Conflict Prevention and Resolution (CPR).
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This post is © 2022. Published in GPSolo eReport, Volume 11, Number 9, April 2022, by the American Bar Association. (Available here.) Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association or the copyright holder.
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#CPRAM22 Highlights: Ethics in the Evolving World of Remote, Hybrid, and In-Person ADR
By Tamia Sutherland
During its March 2-4, 2022, Annual Meeting, CPR–a New York-based conflict resolution think tank, ADR provider, and publisher of this CPR Speaks blog–presented a virtual panel on alternative dispute resolution ethics. The panel discussed ethical guideposts for lawyers, mediators, and arbitrators; challenges and solutions in the new post-pandemic business environment; the rise of the hybrid procedures online and in person; and takeaways for meeting the continuing challenges.
Steven Bierman, a former partner and co-head of litigation at Sidley Austin and founder of Bierman ADR LLC, based in New Canaan, Conn., moderated the panel that included:
- Susan Guthrie, a Chicago-based family law mediator, founder of Learn To Mediate Online, and co-founder of the Mosten Guthrie Academy, a training provider for attorneys, arbitrators, and mediators;
- Jill Pilgrim, a business, sports, and dispute resolution attorney, founder and managing attorney of New York’s Pilgrim & Associates Arbitration, Law & Mediation Offices, and adjunct lecturer in law at Columbia Law School;
- Paul Genender, a partner in of the Complex Commercial Litigation practice group in the Dallas office of Weil, Gotshal & Manges, and
- Ellen Waldman, CPR Vice President of Advocacy & Educational Outreach, and a former professor in the fields of mediation and medical ethics.
The presentation began with an overview of the main sources of ethical standards, which include the American Bar Association Model Rules of Professional Conduct, the ABA/American Arbitration Association/Association for Conflict Resolution Model Standards of Conduct for Mediators, and ABA/AAA Code of Ethics for Arbitrators in Commercial Dispute.
Under the ABA Rules of Professional Conduct, panelist Waldman introduced Model Rules 1.1, and 1.6(a), (c) for consideration. MRPC 1.1–Competence states, “[a] lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation.”
More specifically, she focused on Comment Eight, maintaining competence, which explains what is necessary to maintain the requisite competence: “. . . a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology. …”
With the rise of virtual proceedings and the rise of cybersecurity issues and data breaches, Comment 8 is more relevant now than ever before. Moreover, it interacts with another pivotal ethical rule, MRPC 1.6(a), which covers confidentiality: “[a] lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation or the disclosure is permitted by paragraph (b) [which lists exceptions for disclosures such as ‘to prevent reasonably certain death or substantial bodily harm’].”
This can pose an issue in a virtual environment where accidental screen sharing, screenshots, and unauthorized recordings have become commonplace—especially in light of MRPC 1.6(c), which reads, “[a] lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client.”
Under the Model Standards of Conduct for Mediators, panelist Waldman highlighted Standards IV, V, and VI. Standard IV–Competence, states that “[a] mediator shall mediate only when the mediator has the necessary competence to satisfy the reasonable expectations of the parties … [and] should attend educational programs and related activities to maintain and enhance the mediator’s knowledge and skills related to mediation.”
Standard V–Confidentiality states that “[a] mediator shall maintain the confidentiality of all information obtained by the mediator in mediation, unless otherwise agreed to by the parties or required by applicable law.”
Standard VI–Quality of the Process explains that “[a] mediator shall conduct a mediation in accordance with these Standards and in a manner that promotes diligence, timeliness, safety, presence of the appropriate participants, party participation, procedural fairness, party competency and mutual respect among all participants.”
Under the Code of Ethics for Arbitrators, key rules include Canon IV, titled “An arbitrator should conduct the proceedings fairly and diligently,” and Canon VI, titled “An arbitrator should be faithful to the relationship of trust and confidentiality inherent in that office.”
Additionally, Howard University School of Law Prof. Homer La Rue, founder of the Ray Corollary Initiative (a plan for increasing diversity among the ranks of ADR neutrals), and a CPR Board Member, shared the National Academy of Arbitrators Formal Advisory Opinion No. 26 on video hearings, issued on April 1, 2020, in the chat. The advisory opinion states that “in order to provide an ‘adequate hearing’ by way of video, the arbitrator must be familiar with the platform offered to the parties, and must be confident that the parties have such familiarity as well, or have reasonable access to an effective alternative platform. …”
Before identifying three common themes in the different sources of ethical standards, CPR introduced its model rule amplification proposition that requires third-party neutrals to act diligently, efficiently, and promptly, decline to serve in matters in which the lawyer is not competent to serve, maintain the confidentiality of all information acquired, use reasonable efforts to conduct the process with fairness to all parties, and be especially diligent that unrepresented parties have adequate opportunity to be heard. This referenced both the 2021 CPR Annotated Model Procedural Order for Remote Video Arbitration Proceedings, and the 2002 CPR-Georgetown Commission on Ethics and Standards In ADR Model Rule for the Lawyer as Third-Party Neutral.
The three common rules’ themes discussed were competence, confidentiality, and fairness/quality. The panelists discussed the practical application of each of the themes in practice. They emphasized the importance of using pre-hearing meetings to ensure that the technology does not get in the way of the process, and does not to begin operation until all parties have an even playing field considering the socioeconomic digital divide, as well as the need to consider the effects of zoom fatigue on the parties present.
Videos from #CPRAM22 will be posted; watch www.cpradr.org for updates.
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The author, a second-year law student at the Howard University School of Law, in Washington, D.C., is a CPR 2021-22 intern.
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Getting Online Justice, from AALS’s Annual Meeting
By Ellen Waldman
At the January American Association of Law Schools annual meeting, the organization’s Section on Alternative Dispute Resolution teamed with the Section on Commercial Law and Consumer Law, and the Section on Creditors’ and Debtors’ Rights, to host a panel discussion titled “Online Dispute Resolution in the Post-Pandemic Era.”
The virtual panel featured speakers Alicia Bannon from the Brennan Center for Justice at NYU Law School in New York City; Prof. Jean Sternlight from the University of Nevada, Las Vegas William S. Boyd School of Law, and U.S. Bankruptcy Judge Christopher Lopez, of Texas’s Southern District in Houston. The moderators were Prof. Christopher Bradley of the University of Kentucky’s J. David Rosenberg College of Law, in Lexington, Ky., and Prof. Amy Schmitz from Ohio State University’s Moritz College of Law, in Columbus, Ohio.
Noting that the pandemic pushed many forms of dispute resolution, including trials, into a virtual format, the panel focused its attention on both the promise and peril of widespread adoption of online dispute resolution.
On the promise side of the ledger, panelists agreed that the shift to virtual platforms had the potential to increase the ease with which disputants could access dispute resolution proceedings, cutting down on cost, time and inconvenience.
Judge Lopez, who presides over roughly 3,000 individual and corporate bankruptcies and, as of the conference, had conducted about 20 online mediations since proceedings went virtual in early 2020, was particularly enthusiastic about his court’s use of online evidentiary hearings and mediations. He observed that that stressed debtors juggling multiple jobs and parenting commitments need not take time off from work in order to “go to court.”
Allowing litigants the option to tune-in from their computers and cell phones conserved scarce time and money, helping debtors, in Lopez’s view, “keep their cars” and “stay in their houses.”
But panelists agreed that the rush to pivot online was not without its perils. Alicia Bannon, co-author of a report on best-practice principles for remote court proceedings, noted that the balance courts were being asked to strike was delicate: how best to adhere to public health guidelines while continuing to serve constituent communities, and to expand efficiencies while preserving fairness.
Courts, she suggested, should not be going it alone, but should engage with a diverse array of stakeholders, including, as noted in the report, “community advocates, public defenders and prosecutors, civil legal service providers, tenant representatives, survivors of domestic violence, public health experts, disability rights advocates, court employees, and more.”
The panelists emphasized the traditional courthouse as a place where litigants access legal information and guidance, and suggested that alternative forms of support needed to be built into remote proceedings. Pro se litigants were a particular source of concern as, in addition to being unfamiliar with the justice system, they may have limited computer literacy and may struggle with accessing and engaging with the required technology.
Recognizing and attending to the digital divide was a consistent theme. For those litigants with counsel and a sophisticated mastery of video-camera technique, online proceedings present obvious benefits. But, for those without counsel and no easy access to or understanding of computer-assisted communication, the dangers presented are equally obvious. Static reception, dropped calls, an inconsistent or shaky camera, distracting background visuals and ambient noise all influence a disputant’s ability to communicate, absorb information, and engage with other dispute resolution participants.
And, if one aim of dispute resolution procedures is to foster a disputant’s sense of procedural justice–the experience of having a voice and being heard–technology failures can render that goal impossible.
Prof. Sternlight in particular emphasized the importance of adopting a context-sensitive approach. Drawing on her research into the psychological impacts of varied forms of technology with co-author Jennifer Robbennolt, Sternlight suggested that different communication channels affect disputant behavior and experience in important ways.
For example, certain modes of communication are better suited to the expression and understanding of emotion. We can “read” upset or anger better in face-to-face or even video-conference meetings, as opposed to text or email exchanges.
Similarly, the perceived anonymity of an Internet-based communique can disinhibit disputants who would otherwise maintain a more polite discourse. Asynchronous technological formats such as email can slow down exchanges, leading to more thoughtful and deliberate decision-making. But the leanness of the medium and lack of interpersonal cues can lead to conflict escalation where rapport or goodwill in the relationship is lacking.
At an earlier moment in dispute resolution’s development, Northwestern University Pritzker School of Law Emeritus Prof. Stephen Goldberg and the late Frank Sander of Harvard Law School advocated for a form of triage where policymakers considered both a dispute’s characteristics and the particular attributes of litigation, arbitration, and mediation, and “matched the forum to the fuss.” Stephen B. Goldberg & Frank E.A. Sander, “Fitting the forum to the fuss: Factors to consider when selecting an ADR procedure,” 12 Alternatives 48 (April 1994) (available at https://bit.ly/3sAj8sT).
In today’s environment, panelists urged that we similarly match our technologies to the “fusses” that face us. When determining whether a dispute should be handled in-person, by phone, via video-conference or through an Internet chat, decision-makers must consider their goals for the process, the characteristics of the disputants, and the nature of the dispute or particular task at hand. See Jean R. Sternlight & Jennifer K. Robbennolt, “High-Tech Dispute Resolution: Lessons from Psychology for a Post-Covid-19 Era,” DePaul Law Review (forthcoming) (Sept. 9, 2021) (available at https://bit.ly/3HPjqBx).
All the speakers acknowledged that online dispute resolution proceedings pose new, previously unknown questions. Judge Lopez said that he has been spending a great deal of time thinking through the confidentiality issues that arise when litigants screen-share sensitive financial information that can be easily photographed and distributed.
He also noted that judges had to ensure that there was no “home court” advantage, and that litigants appearing in person receive no special attention compared to those appearing virtually. Panelist Alicia Bannon called attention to a study conducted in an immigration court that revealed detainees appearing virtually in immigration proceedings were more likely to be deported than those facing the judge in person. Appearing by video alone, however, apparently was not the determinative factor. Rather, those detainees who accessed court via video-conference also accessed legal services at lower rates than their “in-person” counterparts and seemed generally less engaged with the judicial process. In this way, the perception that online proceedings may provide a lessor form of justice becomes a self-fulfilling reality.
The discussion ended on a final point that resonated with the audience of educators. Courts need to train attorneys to be proficient with new online technologies and provide resources for disputants so that they can competently participate in virtual proceedings.
Similarly law schools need to emphasize technological competence as they work to prepare lawyers, mediators, arbitrators and other dispute resolution for our brave, new, online world.
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The author is Vice President, Advocacy & Educational Outreach at CPR. Her bio on CPR’s website can be found here.
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Nominee Ketanji Brown Jackson’s ADR Work
By Tamia Sutherland and Russ Bleemer
President Biden’s nominee to the U.S. Supreme Court, U.S. District of Columbia Circuit Court of Appeals Judge Ketanji Brown Jackson, is well acquainted with conflict resolution’s role in legal practice from her law firm days.
The 51-year-old was elevated just last June to the appeals court by Biden, but has been on the bench since 2013, serving as a U.S. District Court judge in Washington, D.C. She would be the first black woman Supreme Court justice if she is confirmed.
While her ADR-centric cases on the bench were few, Jackson–who clerked in 1999-2000 for Justice Stephen G. Breyer, whom she would replace, though she wasn’t at the Court for the justice’s seminal arbitration cases–has significant commercial conflict resolution work in her CV.
Most notably, while of counsel in the Washington office of Morrison & Foerster, Jackson did extensive work on the seminal case of Hall Street Associates LLC v. Mattel Inc., 552 U.S. 576 (2008) (available at http://bit.ly/38ELtSU), successfully preserving respondent Mattel’s arbitration award (pending additional court review) and standing for the proposition that the parties cannot expand the scope of review for an award because it is contrary to the Federal Arbitration Act’s mission.
Jackson’s MoFo litigation department work, on both the civil and criminal sides, was preceded by two years as an associate at one of the nation’s highest-profile commercial conflict resolution practices with mediator Kenneth Feinberg. Jackson was an associate in Feinberg’s Washington firm, then known as the Feinberg Group, in 2002-2003, in the midst of Feinberg’s best-known case, when he served as special master of the September 11th Victim Compensation Fund of 2001. Congress established the fund to aid victims and survivors of the 9/11 attacks; the fund used mediation-style processes to reach out to potential claimants, and evaluated applications, determined appropriate compensation, and disseminated awards.
Judge Jackson described her work at the firm in her Senate Judiciary Committee Questionnaire for Judicial Nominees ahead of a hearing on her nomination last April:
While at the Feinberg Group, I assisted in the negotiated (non-litigation) resolution of mass tort claims. I attended arbitration proceedings and advised client corporations regarding trust payment structures for
resolving mass-tort liability, such as asbestos claims.
She noted later in her disclosure, “my typical clients were large corporations facing mass tort liability. I specialized in mediation and arbitration procedures and in the evaluation of trust structures for the settlement of current and potential (future) tort claims.” She noted that she did not appear in court while working at the firm.
“I recall quite well the superlative legal skills of Judge Jackson while a member of the Feinberg Group Law Firm,” notes Ken Feinberg in an email. He continues:
Ketanji was involved in a series of matters relating to ADR: asbestos mediation, Dow-Corning breast implants mediations and some work on the 9/11 Victim Compensation Fund. Quite apart from her obvious legal skills, she proved to be a creative lawyer looking for paths to resolve complex mass tort litigation outside of the conventional legal system. She quickly recognized that mediation, arbitration and negotiation were cost effective, efficient and an abbreviated way to “get to yes.”
Feinberg concludes, “It was clear to me some 20 years ago that she was destined for greatness.”
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Jackson was confirmed to the D.C. Circuit Court by the Senate 53-44 on June 14. In a statement this morning, the White House noted that the president “sought a candidate with exceptional credentials, unimpeachable character, and unwavering dedication to the rule of law,” but also noted, in anticipation of a close confirmation vote, that “Judge Jackson has been confirmed by the Senate with votes from Republicans as well as Democrats three times.”
Senate Majority Leader Chuck Schumer, D., N.Y., told reporters Friday afternoon he will seek “a prompt hearing” by the Senate Judiciary Committee, to be followed quickly by Senate confirmation to the U.S. Supreme Court seat.
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Judge Jackson further detailed her ADR work in her Senate Judiciary Committee questionnaire. She listed on her questionnaire the sole arbitration case for which she wrote an opinion, CEF Energia B.V. v. Italian Republic, No. 19-cv-3443 (KBJ) (D.D.C. Jul. 23, 2020). In the case, Jackson granted Italy’s request to decline to confirm arbitration awards. The two awards in favor of four energy companies against the Italian government were stayed in a Sweden court pending Italy’s challenge to the award, and the companies sought enforcement before Judge Jackson.
Jackson conducted an analysis of the power to stay proceedings in the United States while a foreign arbitral matter is continuing under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, best known as the New York Convention.
Noting “the ongoing set-aside proceedings that are taking place in Sweden (the primary jurisdiction of the parties’ arbitrations) and the significant interests in judicial economy and international comity that weigh in favor of staying this case,” Jackson stayed the confirmation decision pending the outcome in Sweden.
She wrote that a federal district court “must recognize and enforce a foreign arbitral award ‘unless it finds one of the grounds for refusal or deferral of recognition or enforcement of the award specified in the said Convention.’” 9 U.S.C. § 207. Furthermore, Jackson found that “a court ‘may refuse to enforce the award only on the grounds explicitly set forth in Article V of the Convention.’”
The applicable grounds for refusal Jackson highlighted from Article V of the New York Convention, were that the agreement is not valid if (1) “award …has been set aside or suspended by a competent authority of the country in which … that award was made[,]” or (2) recognition or enforcement… would be contrary to the public policy of that country. New York Convention Art. V(1)(e), Art. V(2)(b).
But Judge Jackson’s holding to stay the confirmation was supported by her findings that the interest of the judicial economy, and the test in Europcar Italia S.P.A. v. Maiellano Tours, 156 F.3d 310 (2d Cir. 1998), which she wrote weighed in favor of staying the case. Quoting Naegele v. Albers, 355 F. Supp.2d 129, 141 (D.D.C. 2005), Jackson stated that “[l]itigating essentially the same issues in two separate forums is not in the interest of judicial economy or in the parties’ best interests.”
In concluding her point that the interest of the judicial economy weighed in favor of staying the case, she acknowledged the length of time that had elapsed and wrote:
This Court fully understands that Petitioners have been pursuing recompense from Italy since 2015 and that the resolution in the [Sweden] Court may take one to two more years. . . . But it is not at all clear that proceeding with the instant litigation will necessarily lead to a faster resolution of the complex issues that must be determined prior to enforcing the awards. …
Judge Jackson carefully analyzed each of the six Europcar factors in deciding whether to stay an action under Article VI of the New York Convention in relation to the CEF Energia B.V. facts, concluding that the Europcar factors weighed in favor of staying the case.
She also noted that the European litigation over the awards stemmed from the controversial European Court decision in Slovak Republic v. Achmea B.V., Case C-284/16 (2018) (available at https://bit.ly/2Kf8OmM), in which the court found that “intra-[European Union] treaty arbitration provisions are invalid to the extent that they prohibit judicial review of EU law by EU courts.” Achmea concerned cases under the Energy Charter Treaty—the treaty under which the CEF Energia B.V. arbitrations were conducted.
In addition to CEF Energia, B.V. v. Italian Republic, Judge Jackson had eight other arbitration-focused cases on her docket covering a range of arbitration issues. In Metropolitan Municipality of Lima v. Rutas De Lima S.A.C. Jackson presided over an issue regarding Federal Arbitration Act Section 10, where the city of Lima, Peru, petitioned and moved for an order vacating an arbitral award that was rendered in favor of the respondent, a contractor. The matter was reassigned to Judge Florence Y. Pan before Jackson could rule on the merits.
The other cases mostly involved confirmation proceedings.
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Here is how Judge Jackson described her work on Hall Street Associates from her Senate Judiciary questionnaire:
From 2007 to 2008, I was part of a litigation team that represented respondent Mattel in a Supreme Court case involving the section of the Federal Arbitration Act that grants expedited judicial review to confirm, vacate, or modify an arbitration award. I was responsible for reviewing the factual record related to the subject matter of the underlying arbitration, and I drafted parts of both the primary brief for respondent and two supplemental briefs on specified issues the Supreme Court ordered. I also assisted in the preparation of oral argument counsel. The Supreme Court ultimately agreed with Mattel’s argument that the Act’s grounds for vacatur and modification of arbitration awards are exclusive for parties seeking expedited review under the FAA, but remanded the case for a determination regarding whether the parties did, in fact, intend for the arbitration proceeding at issue to be governed by the FAA.
She listed the case as one the 10 most significant litigated matters she has worked on in her career on the Senate Judiciary questionnaire.
The case is often cited for limiting the ability of parties to contract for review of their arbitration awards, though it does not apply to arbitration awards written solely under state laws, where, at least theoretically, parties could contract for expanded review under some circumstances.
Hall Street Associates also left alive the judicial standard of “manifest disregard” of the law for overturning awards under FAA Section 10, which commentators have urged needs clarification. See, e.g., Stuart M. Boyarsky, “The Uncertain Status of the Manifest Disregard Standard One Decade after Hall Street,” 123 Dick. L. Rev. 167 (2018) (available at https://bit.ly/3slmLTk), and Michael H. LeRoy, “Are Arbitrators Above the Law? The ‘Manifest Disregard of the Law’ Standard,” 52 B.C. L.Rev. 137 (2011) (available at https://bit.ly/3ImK05i).
The 116-page Senate Judiciary Questionnaire prepared by Judge Jackson containing descriptions of her professional work and education history can be found at https://bit.ly/35vbFSJ.
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Sutherland, a second-year law student at the Howard University School of Law, in Washington, D.C., is a CPR 2021-22 intern. Bleemer edits Alternatives to the High Cost of Litigation for CPR.
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CPR Speaks 