July 1, 2013

From the Spring 2013 DR Magazine: Welsh and Lipsky

By Jen Reynolds

This Spring’s Dispute Resolution Magazine is filled with great articles exploring whether and how we should regulate ADR. Among these articles is a piece by Nancy Welsh (Penn St.) and David Lipsky (Cornell) called, “‘Moving the Ball Forward’ in Consumer and Employment Dispute Resolution: What Can Planning, Talking, Listening and Breaking Bread Together Accomplish?” I found this piece particularly striking as an example of the value of learning conversations.

The article starts off with a provocative story. Faced with the Supreme Court’s endorsement of mandatory pre-dispute arbitration in contracts of adhesion, the Dispute Resolution Section’s Council puts forth a compromise in 2009: mandatory pre-dispute arbitration clauses are acceptable so long as they have meaningful opt-out provisions. Apparently this compromise was, to put it mildly, not popular. The authors describe the reaction afterward as “a firestorm of opposition” from pro- and anti-arbitration proponents so intense that the Council was forced to “abstain from expressing any position at all.”

I recently have been thinking and writing about compromise, and here we see an excellent example of our modern antipathy toward what Gutmann and Thompson call “classic compromises.” In a classic compromise, each side must sacrifice something, and moreover the resultant agreement (the compromise) is often internally inconsistent because it is an amalgam of disparate positions. Because they involve sacrifices and inconsistency, compromises generally do not sit well with us, and perhaps especially with those of us who are integrative bargainers and ADR types seeking to avoid positional struggles. The Council’s proffered compromise — mandatory with opt-out — is an example of a classic compromise, because it requires both sides to sacrifice something of value and leads to an apparently inconsistent result. How can participation be mandatory and voluntary at the same time?

In this case, as Welsh and Lipsky recount, the rejected compromise was not the end of the story. Instead, over the next three years several rich learning conversations followed. These conversations (styled as “study groups” and “roundtables”) sought to promote greater understanding of the issues, not continued partisan advocacy for one approach or another. To do so, the organizers used modified Chatham House Rules (individuals not attached to particular comments or views) and invited scholars, advocates, and dispute resolution providers.

From the standpoint of sharing information, these meetings were quite successful. The article details a number of helpful clarifications around the terms “consumer arbitration” and “employment dispute resolution” that create more play in the joints when talking about what kinds of forward-looking policy measures we might take around arbitration. For example, the prospect of converting “difficult” consumer-initiated claims into “easy” consumer-initiated claims (as with automated credit card chargeback systems and ODR) is an insight into better system design that may take some of the pressure off the policy debate. The article refers to a piece by Vikki Rogers, also in this same issue of the DR Magazine, that explores these system improvements.

More broadly speaking, such intensive learning conversations represent the kind of service that law schools should be doing for local and national communities. Not only is modeling effective process a good way to educate policymakers, but the chance to share information addresses actual information gaps that, once filled, make it easier to find agreement.

But what of the compromise? Can we avoid sacrifice and inconsistency? Indeed, the article ends where it began: with the ABA Dispute Resolution Section. Ultimately, the authors conclude, the next steps (research, best practices) must be undertaken by major dispute resolution organizations. And here I will make my last comment, which is to say that the transition from the learning conversation to commitment/resolution/next steps likely will involve compromise. What the authors suggest, however, is that such a compromise is much more likely to be acceptable now that such deep conversation — conversation in which reasonable minds have disagreed and had a chance to talk about those disagreements — has taken place.

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Comments

  • Jill Gross says:

    Given the Supreme Court’s most recent endorsement of class action waivers in arbitration agreements in AMEX v. Italian Colors, it is critical that stakeholders move forward and generate solutions that actually can be implemented to counteract the force of mandatory arbitration. It is very unlikely Congress will reform the Federal Arbitration Act, so pro-consumer change will emanate only from these Roundtables, “conversations” and other think tanks devoted to real change — and no doubt compromise will be a prerequisite to change.

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