Karl Bayer stumbled upon this year’s Fulbright & Jaworki’s Litigation Trends Survey Report and we thought you might be interested in reading it. Here is an excerpt: How to Resolve? Litigation versus Arbitration: 20. Commercial International Arbitrations Expected to Rise: Nearly a quarter of counsel from large-cap companies and 17% of all respondents expect an increase in the number of commercial international arbitrations they will be involved in over the coming year. Increases are expected, particularly, in the financial services, insurance, manufacturing and retail sectors. 21. Rate of International Arbitration Higher in U.K. and Among Retail/Wholesale: 22% of U.K. respondents say their company has been party to at least one international arbitration in the last 12 months, versus 14% of U.S. respondents. That number goes up to 29%, however, when looking only at large-cap companies. Moreover, 72% of retail and wholesale companies that participated in the survey commenced at least one international arbitration in the past 12 months. 22. Arbitration in Labor Suits – A Special Case: 15% of respondents said their company requires arbitration of disputes in non-union settings – that`s down from last year`s 22%. Why choose arbitration for these suits? The process is beneficial from an employee-relations standpoint, according to 83% of those respondents. Cost also is an issue: The median cost ($50,000) to arbitrate a single-plaintiff employment case is about half the median cost ($99,038) of litigating a single-plaintiff employment case to conclusion. Though arbitration is not the better route for everyone: Large-cap companies, on the whole, spend more on arbitrating single-plaintiff cases, with 61% of large-caps paying upwards of $50,000 per case. The median cost of arbitration for public companies is also substantially higher than for private companies. 23. For Domestic Disputes, Leaning Toward Litigation: 55% of U.S. respondents said that in disputes that are not international in nature, and when given a choice, they opt for litigation over arbitration – from both the defensive and offensive side. (In the U.K., however, arbitration for domestic disputes remains popular with 51% of U.K. respondents saying they opt for arbitration in domestic disputes.) The primary considerations for choosing one over another are cost, efficiency, higher comfort level and predictability of outcome. 24. Why Are Some In-House Counsel Choosing Litigation for Domestic Disputes? In the U.S., some in-house lawyers believe litigation is more likely to produce decisions on the legal merits rather than an arbitrator`s unchecked sense of fair play. What`s more: arbitration can be no less expensive or time-consuming. The median cost for arbitration – $50,000 – is way up from last year`s median cost of $35,000. Litigation, some respondents say, offers greater discovery opportunities, greater availability of dispositive motions and more established rules. Any thoughts? You may download Fulbright’s 6th Annual Litigation Trends Survey Report here. Technorati Tags: arbitration, ADR, law,
Continue reading...In Theriault v. FIA Card Services, N.A., No. 09-30233 (5th Cir. Oct. 8, 2009), Victor Theriault became delinquent on his credit card account with FIA Card Services, N.A. (formerly known as MBNA America Bank, N.A.) (FIA) around December 2006. FIA filed for arbitration at the National Arbitration Forum (NAF). On April 2007 NAF issued an arbitration award in favor of FIA. Theriault challenged the award on the grounds that FIA had violated the Truth in Lending Act (TILA) and breached its contract. The district court confirmed the arbitration award and Theriault now appeals. The Fifth Circuit, in a two-page unpublished opinion, affirmed the district court’s judgment. The court said that Theriault failed to establish grounds for vacating the arbitration award under Section 10 of the Federal Arbitration Act. Technorati Tags: arbitration, ADR, law, Fifth Circuit, NAF, National Arbitration Forum
Continue reading...Last week’s Wall Street Journal had an interesting and well-written article about arbitration of credit card disputes, centered around the National Arbitration Forum (NAF). Hat tip to Don Philbin. Here is an excerpt: Arbitration and mediation have existed as ways to resolve disputes in the U.S. for more than 200 years. They became the standard practice in the financial world after 1987, when a Supreme Court decision gave securities firms the go-ahead to require arbitration to resolve brokerage-account disputes. In a typical case, a bank refers an unpaid credit-card bill to a debt collector. If the collector is unsuccessful at recovering it, it refers the case to an arbitration body. Arbitration bodies, such as NAF and AAA, which generated revenue by charging fees to the parties involved, use retired judges and attorneys as arbitrators who decide the cases. If the arbitrator rules for the creditor, the collector can ask a court for a judgment to collect. Because a debt collector can earn up to a third of the debt outstanding when the ruling is in the bank’s favor, it can be in a collector’s interest for an arbitrator to rule against the card holder. Former arbitrators, a congressional subcommittee, consumers and government suits are now alleging that NAF has been systematically ruling against consumers for years. Banks prevail over consumers in 94% of debt-collection arbitrations, an NAF official said in recent testimony to a congressional subcommittee. Arbitration advocates defend those results, citing studies that show debtors lose at a similar rate in court. They say that there is typically a long paper trail proving that customers owe the amounts in dispute. A congressional subcommittee, which began an investigation last year to study the fairness of mandatory arbitration, concluded in July that the current arbitration system is “ripe for abuse.” Arbitration, as “operated by NAF, does not provide protection for those consumers,” the committee said. A sweeping overhaul won’t occur unless Congress decides whether to pass laws limiting how arbitration can be used. But arbitration experts now expect that more collection claims will be funneled into the courts. Read the full article here. Related Posts: Pending U.S. Legislation on Arbitration and Mediation: Update (Oct. 14) Class Action Suit Filed Against the National Arbitration Forum (Sept. 17) U.S. Congressional Hearing | “Mandatory Binding Arbitration – Is it Fair and Voluntary?” (Sept. 16) Videos of Congressional Hearing | Arbitration or Arbitrability?: the Misuse of Arbitration to Collect Consumer Debts (Sept. 7) American Bar Association’s Resolutions on the Arbitration Fairness Act of 2009 (Aug. 26) Recent Developments in Arbitration of Consumer Disputes (Aug. 14) Testimony from the U.S. Congress Hearing on the Misuse of Arbitration to Collect Consumer Debts (July 24) The American Arbitration Association Confirms Today That It Supends Arbitration of Consumer Debt Collection (July 23) National Arbitration Forum Settles with Minnesota’s Attorney General (July 20) U.S. Congress Hearing on the Misuse of Arbitration to Collect Consumer Debts (July 20) National Arbitration Forum Sued by the Minnesota Attorney General (July 16) National Arbitration Forum’s Response to NPR Arbitration Story (June 17) Employment and Consumer Arbitration: NPR Article (June 10) Technorati Tags: arbitration, ADR, law, legislation, Arbitration Fairness Act of 2009, consumer arbitration, National Arbitration Forum
Continue reading...Effective October 5 2009, the Internal Revenue Service (IRS) has an updated mediation procedure for cases in the Appeals administrative process. Under Revenue Procedure 2009-44, the IRS expands the types of cases eligible for voluntary mediation and clarifies the cases that are ineligible. Mediation is available for: Legal issues. Factual issues. Certain compliance coordination issues. Early referral issues where agreement is not reached. Issues for which a request for competent authority assistant has not yet been filed. Unsuccessful attempts to enter into a closing agreement. Offer in compromise and Trust Fund Recovery Penalty cases. The new procedure also provides that settlement agreements on mediation cases of $50,000 or more must be reviewed by the Office of Chief Counsel. Read more here. Technorati Tags: ADR, law, mediation, IRS
Continue reading...Disputing is published by Karl Bayer, a dispute resolution expert based in Austin, Texas. Articles published on Disputing aim to provide original insight and commentary around issues related to arbitration, mediation and the alternative dispute resolution industry.
To learn more about Karl and his team, or to schedule a mediation or arbitration with Karl’s live scheduling calendar, visit www.karlbayer.com.
Disputing is published by Karl Bayer, a dispute resolution expert based in Austin, Texas. Articles published on Disputing aim to provide original insight and commentary around issues related to arbitration, mediation and the alternative dispute resolution industry.
To learn more about Karl and his team, or to schedule a mediation or arbitration with Karl’s live scheduling calendar, visit www.karlbayer.com.