Dispute Resolution and Arbitration Commons^™

Shots Fired: Digging The Uniformed Services Employment And Reemployment Rights Act Out Of The Trenches Of Arbitration, Lisa Limb

Michigan Law Review

The Uniformed Services Employment and Reemployment Rights Act (USERRA) was enacted to protect servicemembers from discrimination by civilian employers and to provide servicemembers with reemployment rights. Recent circuit court decisions, however, have maimed these protections by ruling that mandatory arbitration is permissible under USERRA. This Note argues that such rulings conflict with USERRA’s plain language, statutory structure, and purpose. Ultimately, in light of strong public policy considerations, this Note contends that mandatory arbitration should not be permissible under USERRA and proposes that Congress amend the Act to explicitly prohibit arbitration.

The Hague Rules On Business And Human Rights Arbitration, Bruno Simma, Diane Desierto, Martin Doe Rodriguez, Jan Eijsbouts, Ursula Kriebaum, Pablo Lumerman, Abiola Makinwa, Richard Meeran, Sergio Puig, Steven Ratner, Giorgia Sangiuolo, Martijn Scheltema, Anne Van Aaken, Katerina Yiannibas

Other Publications

The Hague Rules on Business and Human Rights Arbitration provide a set of procedures for the arbitration of disputes related to the impact of business activities on human rights. The Hague Rules are based on the Arbitration Rules of the United Nations Commission on International Trade Law (with new article 1, paragraph 4, as adopted in 2013) (the “UNCITRAL Rules”), with modifications needed to address certain issues likely to arise in the context of business and human rights disputes. Each article is accompanied by a commentary, which includes background on the drafting of various provisions in the Rules, explaining in …

The New York Convention: A Self-Executing Treaty, Gary B. Born

Michigan Journal of International Law

The thesis of this Article is that uncertainty regarding the Convention’s status as a self-executing treaty of the United States is unwarranted and unfortunate. Instead, both the Convention’s provisions for recognition and enforcement of arbitration agreements (in Article II) and of arbitral awards (in Articles III, IV, V, and VI) should be regarded as self-executing and directly applicable in U.S. (and other national) courts. As discussed in detail below, this is because Article II establishes mandatory, complete, and comprehensive substantive rules, directed specifically to national courts, for the recognition and enforcement of international arbitration agreements. Likewise, the history and purposes …

A Global Treaty Override? The New Oecd Multilateral Tax Instrument And Its Limits, Reuven S. Avi-Yonah, Haiyan Xu

Michigan Journal of International Law

This article will proceed as follows. Section 2 summarizes the main provisions of the MLI. Section 3 discusses the purpose of tax treaties in the twenty-first century, because it can be argued that they are less necessary under conditions of tax competition. Section 4 raises the question whether tax treaties can be improved short of a full-fledged multilateral tax treaty by inserting a most favored nation (MFN) provision similar to those found in bilateral investment treaties. Such an MFN provision operates over time to create a de facto multilateral treaty without the negotiation of one. Section 5 concludes this article.

Mandatory Arbitration In Consumer Finance And Investor Contracts, Michael S. Barr

Book Chapters

This chapter focuses on the use of mandatory pre-dispute arbitration clauses in a subset of consumer contracts – those involving consumer finance and investor products and services. Arbitration clauses are pervasive in financial contracts – for credit cards, bank accounts, auto loans, broker-dealer services, and many others. In the wake of the recent financial crisis, Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank). Dodd-Frank authorises the new Consumer Financial Protection Bureau (CFPB) and the Securities and Exchange Commission (SEC) to prohibit or condition the use of arbitration clauses in consumer finance and investment contracts, …

Labor And Employment Arbitration Today: Mid-Life Crisis Or New Golden Age?, Theodore J. St. Antonie

Articles

The major developments in employer-employee arbitration currently do not involve labor arbitration, that is, arbitration between employers and unions. The focus is on employment arbitration, arbitration between employers and individual employees. Beginning around 1980, nearly all the states judicially modified the standard American doctrine of employment-at-will whereby, absent a statutory or contractual prohibition, an employer could fire an employee "for good cause, for no cause, or even for cause morally wrong." Under the new regime, grounded in expansive contract and public policy theories, wrongfully discharged employees often reaped bonanzas in court suits, with California jury awards averaging around $425,000." Many …

A Comprehensive Theory Of Civil Settlement, J. J. Prescott, Kathryn E. Spier

Articles

A settlement is an agreement between parties to a dispute. In everyday parlance and in academic scholarship, settlement is juxtaposed with trial or some other method of dispute resolution in which a third-party factfinder ultimately picks a winner and announces a score. The “trial versus settlement” trope, however, represents a false choice; viewing settlement solely as a dispute-ending alternative to a costly trial leads to a narrow understanding of how dispute resolution should and often does work. In this Article, we describe and defend a much richer concept of settlement, amounting in effect to a continuum of possible agreements between …

Mandatory Arbitration In Consumer Finance And Investor Contracts, Michael S. Barr

Articles

Mandatory pre-dispute arbitration clauses are pervasive in consumer financial and investor contracts—for credit cards, bank accounts, auto loans, broker-dealer services, and many others. These clauses often ill serve households. Consumers are typically presented with contracts on a “take it or leave it” basis, with no ability to negotiate over terms. Arbitration provisions are often not clearly disclosed, and in any event are not salient for consumers, who do not focus on the importance of the provision in the event that a dispute over the contract later arises, and who may misforecast the likelihood of being in such a dispute. The …

Reasoned Awards In International Commercial Arbitration: Embracing And Exceeding The Common Law-Civil Law Dichotomy, S. I. Strong

Michigan Journal of International Law

Unlike many types of domestic arbitration where unreasoned awards (often called “standard awards”) are the norm, international commercial arbitration routinely requires arbitrators to produce fully reasoned awards. However, very little information exists as to what constitutes a reasoned award in the international commercial context or how to write such an award. This lacuna is extremely problematic given the ever-increasing number of international commercial arbitrations that arise every year and the significant individual and societal costs that can result from a badly written award. Although this Article is aimed primarily at specialists in international commercial arbitration, the material is also useful …

Enforceability Of Mandatory Arbitration Clauses For Shareholder-Corporation Disputes, Garry D. Hartlieb

Michigan Business & Entrepreneurial Law Review

Investor litigation is an increasingly vexatious field of law. Nearly every time a significant change of control or corporate ownership occurs, plaintiffs’ attorneys file standardized complaints to set in motion class action suits. Ultimately, the settlements shareholders receive fail to achieve the practical effects that parties on both sides desire. Shareholders may receive pennies on the dollar of what they allege was lost by corporate wrongdoing, and, in some cases, shareholders may not receive monetary recovery as the settlement requires only that the corporation to make changes to its governing documents. These suits distract directors and management from the core …

The Influence Of Arbitrator Background And Representation On Arbitration Outcomes, Adam C. Pritchard, Stephen J. Choi, Jill E. Fisch

Articles

We study the role of arbitrator background in securities arbitration. We find that several aspects of arbitrator background are correlated with arbitration outcomes. Specifically, industry experience, prior experience as a regulator, and status as a professional or retired arbitrator are correlated with statistically significant differences in arbitration awards. The impact of these characteristics is affected by whether the arbitrator in question serves as the panel chair and by whether the parties to the arbitration are represented by counsel. Our findings offer some preliminary insights into the debate over possible arbitrator bias. On the one hand, they suggest that the party …

Employment Arbitration Reform: Preserving The Right To Class Proceedings In Workplace Disputes, Javier J. Castro

University of Michigan Journal of Law Reform

The recent judicial enforcement of class waivers in arbitration agreements has generated ample debate over the exact reach of these decisions and their effects on the future of collective action for consumers and employees. In AT&T Mobility v. Concepcion, a 5-4 majority of the Supreme Court majority held that the Federal Arbitration Act (FAA) preempted state laws prohibiting companies from incorporating class action waivers into arbitration agreements. The Court upheld such waivers on the grounds that they are consistent with the language and underlying purpose of the FAA. Most courts across the country have since reinforced the strong federal policy …

The Use And Abuse Of Precedent In Labor And Employment Arbitration, Theodore J. St. Antoine

Articles

As he did so often with legal problems, Oliver Wendell Holmes put his finger on the key to the problem of precedent with a memorable assertion. Said he: "It is revolting to have no better reason for a rule of law than that so it was laid down in the time of Henry IV." Notice that Holmes did not say it is a bad thing for a rule to have an ancient lineage. The question is whether the rule that may have made sense when Henry IV reigned, or when the Wagner Act was passed, has stood the test of …

Parallel Justice: Creating Causes Of Action For Mandatory Mediation, Marie A. Failinger

University of Michigan Journal of Law Reform

The American common law system should adopt court-connected mandatory mediation as a parallel system of justice for some cases that are currently not justiciable, such as wrongs caused by constitutionally protected behavior. As evidence that such a system is practical, this Article describes systemic and ethical parallels between court-connected mediation and the rise of the equity courts in medieval England, demonstrating that there are no insurmountable practical objections to the creation of “mediation-only” causes of action. The Article then explores the constitutional concerns surrounding the idea of “mandatory mediation-only” causes of action, using constitutional hate speech and invasion of privacy …

The Bible Of Labor Arbitration: Tribute To Professor Frank Elkouri, Theodore J. St. Antoine

Other Publications

Each of the three traditional learned professions has had its “bible.” Divines had the progenitor, the Holy Bible itself; medical doctors had Gray’s Anatomy; and lawyers had Blackstone. What could be more fitting than that the sprightly newcomer to the ranks of the learned professions—labor arbitration—should also have its own bible: Elkouri & Elkouri, How Arbitration Works? But while Blackstone, Gray’s, and perhaps even the King James Version have largely been supplanted by sleeker, more contemporary models, nothing of the sort has happened to Elkouri. It just sails on majestically from one edition to another, now heading into its seventh.

To Skin A Cat: Qui Tam Actions As A State Legislative Response To Concepcion, Janet Cooper Alexander

University of Michigan Journal of Law Reform

The Supreme Court's decision in Concepcion is widely regarded as heralding the demise of small-claims class actions whenever contracts of adhesion are involved in the transaction-which means for virtually all consumer and employment claims. Amending the Federal Arbitration Act to overturn Concepcion would be a relatively simple exercise in legislative drafting, but in the current political climate such efforts are unlikely to succeed. Thus far, proposed federal corrective legislation has failed to pass, and federal agency regulation of class waivers has been lacking. State legislatures might have the political ability to pass corrective legislation, but virtually all state limitations on …

Concepcion's Pro-Defendant Biasing Of The Arbitration Process: The Class Counsel Solution, David Korn, David Rosenberg

University of Michigan Journal of Law Reform

By mandating that numerous plaintiffs litigate their common question claims separately in individual arbitrations rather than jointly in class action arbitrations, the Supreme Court in AT&T Mobility LLC v. Concepcion entrenched a potent structural and systemic bias in favor of defendants. The bias arises from the parties' divergent stakes in the outcome of the common question litigation in individual arbitrations: each plaintiff will only invest to maximize the value of his or her own claim, but the defendant has an incentive to protect its entire exposure and thus will have a classwide incentive to invest more in contesting common questions. …

What The Awards Tell Us About Labor Arbitration Of Employment Discrimination Claims, Ariana R. Levinson

University of Michigan Journal of Law Reform

This Article contributes to the debate over mandatory arbitration of employment-discrimination claims in the unionized sector. In light of the proposed prohibition on union waivers in the Arbitration Fairness Act, this debate has significant practical implications. Fundamentally, the Article is about access to justice. It examines 160 labor arbitration opinions and awards in employment-discrimination cases. The author concludes that labor arbitration is a forum in which employment-discrimination claims can be-and, in some cases, are-successfully resolved. Based upon close examination of the opinions and awards, the Article recommends legislative improvements in certain cases targeting statutes of limitations, compulsory process, remedies, class …

American Express Co. V. Italian Colors Restaurant: Brief Of Professional Arbitrators And Arbitration Scholars As Amici Curiae In Support Of Respondents, Theodore J. St. Antoine

Appellate Briefs

This case involves question of substantial importance to the field of arbitration. Amici are professional arbitrators and scholars. They file this brief to give the Court the benefit of their many years of practical experience and scholarly study. In our view, the effective-vindication rule that pervades this Court's last 25 years of arbitration jurisprudence is crucial to promoting public confidence in the legitimacy of arbitration and furthering the federal policy favoring arbitration. Eradicating that rule will undermine arbitration's legitimacy and leave it a weakened institution in the eyes of the public.

The effective-vindication rule is an integral component of the …

Protecting The Right Of Citizens To Aggregate Small Claims Against Businesses, Paul D. Carrington

University of Michigan Journal of Law Reform

Two years ago I ranted against the Supreme Court's subversion of the Rules Enabling Act and its opposition to the benign aims of the twentieth-century progressive law reformers expressed summarily in Rule 1 of our Federal Rules of Civil Procedure. I observed then that the majority of the Justices of the Supreme Court appeared to have joined the Chamber of Commerce, aligning themselves also with Vice President Dan Quayle's 1989 Council on Competitiveness that denounced effective civil procedure as an enemy of economic development. I was then commenting adversely on what the Court had done to transform Rule 8. I …

A Presumptively Better Approach To Arbitrability, John A. E. Pottow, Jacob Brege, Tara J. Hawley

Articles

One of the most complex problems in the arbitration field is the question of who decides disputes over the scope of an arbitrator's purported authority. Courts in Canada and the United States have taken different approaches to this fundamental question of "arbitrability" that necessarily arises when one party disputes the contractual validity of the underlying "container" contract carrying the arbitration clause. If arbitration is a creature of contract, and contract is a product of consensual agreement, then any dispute that impugns the underlying consent of the parties to the container contract implicates the arbitration agreement itself (i.e., no contract, no …

The Boundaries Of Most Favored Nation Treatment In International Investment Law, Tony Cole

Michigan Journal of International Law

Contemporary international investment law is characterized by fragmentation. Disputes are heard by a variety of tribunals, which often are constituted solely for the purpose of hearing a single claim. The law applicable in a dispute is usually found in a bilateral agreement, applicable only between the two states connected to the dispute, rather than in a multilateral treaty or customary international law. Moreover, the international investment community itself is profoundly divided on many issues of substantive law, meaning both that the interpretation given to international investment law by a tribunal will be determined largely by those who sit on it, …

Dispute Resolution As A Part Of Your Merger Or Your Acquisition Agreement, Kenneth Mathieu, Vincent (Trace) P. Schmeltz Iii

Michigan Business & Entrepreneurial Law Review

Often overlooked until invoked, the dispute resolution provisions of an acquisition agreement frequently mirror the terms of a lawyer’s last deal. Yet such provisions—including purchase price adjustment clauses, the terms of governing earn-out disputes, and the contract sections outlining the indemnification claims process—often have long-term economic ramifications on the buyers and sellers. In working with corporate lawyers over the years, we have noted that corporate lawyers understand (and give intense thought to) the leverage their clients have, what their clients hope to accomplish in a transaction, and what makes long-term economic sense in drafting an agreement and negotiating more advantageous …

Cruises, Class Actions, And The Court, David Korn, David Rosenberg

University of Michigan Journal of Law Reform Caveat

As the Carnival Triumph debacle splashed across the national consciousness, lawyers shook their heads. Sensationalist news coverage exposed common knowledge in the legal community: cruise passengers have little recourse against carriers, and, as a result, they often bear the brunt of serious physical and financial injuries. Cruise lines, escaping legal accountability for their negligence, sail off undeterred from neglecting passenger safety on future voyages. While its previous decisions helped entrench this problem, a recently argued case presents the Supreme Court with another opportunity to address it.

Why American Express V. Italian Colors Does Not Matter And Coordinated Pursuit Of Aggregate Claims May Be A Viable Option After Concepcion, Gregory C. Cook

University of Michigan Journal of Law Reform Caveat

This Comment suggests that the upcoming decision by the Supreme Court in American Express Co. v. Italian Colors Restaurant will not change the class action landscape. While the plaintiff bar contends that certain public policy goals will be lost as a result of American Express and AT&T Mobility LLC v. Concepcion, this Comment argues that, in the correct circumstances, coordinated individual arbitrations can address at least some of these public policy goals and plaintiff counsel should focus on such coordination efforts (including, for instance, ethically recruiting actually-injured plaintiffs, the use of common plaintiff counsel, the use of common experts, and …

Employment Arbitration: The Voice Of (Mostly Vicarious) Experience, Theodore J. St. Antoine

Book Chapters

At the 1999 Annual Meeting of the National Academy of Arbitrators (NAA), Dennis Nolan gave a provocative, influential address on the Academy’s future. He concluded that if the organization was to survive and remain a vibrant force for workplace justice, to the mutual benefit of employers and employees, it must expand beyond its traditional role in labor arbitration based on collective bargaining. According to Nolan, the Academy should also encompass employment arbitration in the nonunion context. Like many good advocates, he may have slightly overstated his case. Although subsequent changes in admission standards now allow the counting of 10 employment …

The Moral Dimension Of Employment Dispute Resolution, Theodore J. St. Antoine

Articles

Dispute resolution may be viewed from the perspective of economics or negotiation or contract law or game theory or even military strategy. In this Article, I should like to consider employment dispute resolution in particular from the perspective of morality. I do not necessarily mean "morality" in any religious sense. By "morality" here I mean a concern about the inherent dignity and worth of every human being and the way each one should be treated by society. Some persons who best exemplify that attitude would style themselves secular humanists. Nonetheless, over the centuries religions across the globe have played a …

Employment Arbitration: Panel Discussion, Theodore J. St. Antoine

Other Publications

The rapid growth of arbitration in nonunion employment settings has provoked endless debate about its advantages and disadvantages for employers, employees, and unions. Often absent from the debate is systematic, reliable information on the extent of employment arbitration and arbitration outcomes. Professor Alexander Colvin of Cornell University has undertaken pioneering work that explores how employment arbitration is working in practice and its impact on the major players. After Professor Colvin presented his latest findings, a panel of leading arbitrators and advocates discussed the implications of his results for the continuing development of employment arbitration.

Adr In Labor And Employment Law During The Past Quarter Century, Theodore J. St. Antoine

Articles

Two events can serve as bookends for alternative dispute resolution (ADR) in labor and employment law during the past quarter century. The first was the 1991 U.S. Supreme Court decision in Gilmer v. Interstate/Johnson Lane Corp. The Court approved so-called "mandatory arbitration" by holding that an individual stockbroker was bound by a contract with the New York Stock Exchange to arbitrate a claim of age discrimination against his employer, rather than take the case to court. The second event, or set of events, is the current consideration by Congress of the proposed Employee Free Choice Act (EFCA) and Arbitration Fairness …

Attorneys As Arbitrators, Adam C. Pritchard, Stephen J. Choi, Jill E. Fisch

Articles

We study the role of attorneys as arbitrators in securities arbitration. We find that arbitrators who also represent brokerage firms or brokers in other arbitrations award significantly less compensation to investor-claimants than do other arbitrators. We find no significant effect for attorney-arbitrators who represent investors or both investors and brokerage firms. The relation between representing brokerage firms and arbitration awards remains significant even when we control for political outlook. Arbitrators who donate money to Democratic political candidates award greater compensation than do arbitrators who donate to Republican can-didates. We also study the dynamics of panel interaction. We find that the …