Insights & News

ADR Advisor, December, 2015

December 15, 2015
Client Alert

The Value of Arbitration: A Response to The New York Times
To Cross or Not? Strategies for Calling Witnesses for Cross-examination in International Arbitration
Stradley At Work

The Value of Arbitration: A Response to The New York Times

By Lee A. Rosengard and Bridget C. Giroud

In its recent three-part series “Beware the Fine Print,” The New York Timesi called into question the fairness of mandatory arbitration provisions. Sparking a national debate, the series suggests that mandatory arbitration replaces the protections afforded by traditional litigation with top-secret proceedings presided over by arbitrators who favor corporations. The series goes so far as to suggest that individuals often forgo bringing claims altogether rather than participate in a mandatory arbitration process that they believe is unfairly tilted against them.

These conclusions miss the mark. The hallmark of mandatory arbitration is the parties’ freedom to contract for a dispute resolution process other than traditional litigation in court. In principle, mandatory arbitration is advantageous to both corporations and individuals because it offers parties more control over the proceedings than they would have in the civil trial system. It can also lead to faster, cheaper outcomes.

Arbitration can give both corporations and individuals more input in the decision-making process than either would have in the civil trial system. Parties typically choose arbitrators together. Unlike jury selection, this gives the parties an opportunity to research the decision-makers’ backgrounds – including any potential biases – before selection. Additionally, a number of providers, such as the American Arbitration Association, organize arbitrators by industry, so parties can choose experts in the fields relevant to their dispute, making deliberations more efficient and informed. Further, arbitration hearings allow for more open communication than at trial, because they are confidential.

In addition to enhanced control, arbitration also usually provides a cheaper, faster final outcome for all. According to a 2009 study of consumer arbitrations conducted by the AAA,ii for example, plaintiffs spent, on average, only $96 on proceedings for claims totaling under $10,000. The study also found that the average time to resolution of consumer arbitrations is less than seven months. Additionally, because there is almost no opportunity to appeal arbitration decisions, except under very rare circumstances, cost predictability and timely closure result.

While arbitration may not be appropriate for every contractual relationship, its flexibility and efficiency make it an option that parties should consider. Recognizing arbitration’s advantages, organizations like CPR – the International Institute for Conflict Prevention & Resolutioniii – have proposed that the recent criticism of the process demonstrates the need for the implementation of mandatory and consistent procedural rules, not the complete abolishment of mandatory arbitration.iv

The answer to the doubters is that there are ways to improve the arbitration system, like everything else, but that it would serve no one’s interest to remove arbitration from the dispute-resolution options available to consumers and businesses alike.

i Jessica Silver-Greenberg and Robert Gebeloff, “Arbitration Everywhere, Stacking the Deck of Justice,” N.Y. TIMES, Oct. 31, 2015, http://www.nytimes.com/2015/11/01/business/dealbook/arbitration-everywhere-stacking-the-deck-of-justice.html?_r=0; Jessica Silver-Greenberg and Michael Corkery, “In Arbitration, a ‘Privatization of the Justice System,’” N.Y. TIMES, Nov. 1, 2015, http://www.nytimes.com/2015/11/02/business/dealbook/in-arbitration-a-privatization-of-the-justice-system.html; Michael Corkery and Jessica Silver-Greenberg, “In Religious Arbitration, Scripture Is the Rule of Law,” N.Y. TIMES, Nov. 2, 2015, http://www.nytimes.com/2015/11/03/business/dealbook/in-religious-arbitration-scripture-is-the-rule-of-law.html.

ii Pat Vaughan Tremmel, “Examination of Consumer Arbitrations as Policy Debate Heats Up,” NORTHWESTERN UNIVERSITY (March 11, 2009), http://www.northwestern.edu/newscenter/stories/2009/03/arbitrations.html.

iii Noah J. Hanft, “A New Scarlet ‘A’ for Arbitration?” INTERNATIONAL INSTITUTE FOR CONFLICT PREVENTION & RESOLUTION (November 2015)

iv For instance, the series does highlight fairness concerns with mandatory arbitration provisions in form contracts, which contain terms as to which consumers have no input and that they often do not read. Even where consumers are able to “opt out” of arbitration under these contracts, the series’ authors found, “few consumers take advantage of it because they do not realize they have signed a clause to begin with, or do not understand its consequences, according to interviews with lawyers and plaintiffs.” While arbitration can often offer these consumers the advantages discussed here, the system works best where the parties choose arbitration.

To Cross or Not? Strategies for Calling Witnesses for Cross-examination in International Arbitration

By Joseph T. Kelleher and Brandon Riley

One of the hallmarks of international arbitration is that contrary to the American litigation tradition, there is no live direct testimony from the witnesses. Instead, each witness submits an often lengthy written witness statement (more often drafted by lawyers) as the whole of his or her direct testimony. It is then up to the opposing litigation team to decide whether to cross-examine that witness. It is a crucial strategic decision.

The decision is key because if opposing counsel does not designate that witness for cross-examination and the tribunal does not exercise its authority to compel his or her presence at the hearing, the arbitral tribunal will never hear live testimony from that witness. Live testimony is usually more persuasive than the written word, because a live witness breathes life into an otherwise dry recitation of the facts. So the decision for opposing counsel is whether to give a witness an opportunity to provide texture to the written statement through the in-person appearance that comes with cross-examination or to allow the statement of that witness to go unchallenged and thereby keep the witness from being in the presence of the tribunal. Ask yourself, how many cases are won on cross-examination?

Counsel can find guidance in making the decision by considering a number of questions:

  • How strong is the witness statement? If the witness statement does not add much to the other side’s case, consider forgoing cross-examination.
  • Does the witness statement cover the same facts as other witness statements presented by the other side? If it does, consider not cross-examining the witness.
  • Are there strong witness statements or documented facts that rebut this witness’ statement already in the record through other witnesses or that will be adduced by the cross-examination of other witnesses? If so, cross-examination of that witness is probably unnecessary.
  • In what language will the witness testify? Although the witness statement will have been translated into the forum language (often English) for the benefit of the parties and tribunal, the witness may not speak that language or, even if he or she does, may elect to testify in the native language through an interpreter. Translation in both directions can give the witness a much longer opportunity to consider the response to questions during cross-examination, and the immediacy of traditional cross-examination is lost. If there are several witnesses who will be testifying in a foreign language, consider calling only the ones whose cross-examination is most important to your client.

In the end, counsel must decide whether to cross-examine a witness in an international arbitration on a witness-by-witness basis. While the reflexive reaction may be to cross-examine the majority of witnesses, the better practice is to avoid automatically listing opposing witnesses for cross-examination. Instead, it is best to be thoughtful about the impact of their existing written statements and considerate of whether allowing them an opportunity for a personal appearance before the tribunal will help or hurt your cause. Take care to avoid unnecessarily or inadvertently diminishing your client’s case by handing an opposing witness an audience he or she would not otherwise have had, or allowing the witness to have influence he or she may not otherwise have brought to bear on the arbitrators.

Stradley At Work

Kevin Casey presented “The Barbed Wire Invention: An External Factor Affecting American Legal Development” at The Federal Circuit Historical Society luncheon during the Federal Circuit Bar Association’s 2015 Bench & Bar Conference. The discussion focused on the changes in rules of law fostered by the invention of the barbed wire fence and its impact in various areas of law.

Super Lawyers named 35 Stradley Ronon attorneys to its annual listing of the top-rated lawyers in the country. Featured in Super Lawyers magazine, these attorneys are among the top five percent of lawyers in their geographic region, as chosen by their peers and a nomination committee review. Seven attorneys from Stradley’s Alternative Dispute Resolution practice group were included on the list: 

Jon Bloom 
Kevin Casey 
Karl Myers 
John Nader 
Ben Picker 
Ellen Rosen Rogoff 
Lee Rosengard

Best Lawyers named 23 Stradley Ronon attorneys to its recently released 2016 edition of The Best Lawyers in America, regarded as a definitive guide to legal excellence in the region. The chosen lawyers received high ratings from their peers in the publication’s annual survey for their “abilities, professionalism and integrity.” Included on the list were Kevin Casey, Ben Picker and Ellen Rosen Rogoff.

Chambers & Partners recognized Kevin Casey for Intellectual Property (Pennsylvania) in the 2015 edition of Chambers USA: America’s Leading Lawyers for Business. Attorney rankings within come from extensive independently conducted research and in-depth interviews with clients and attorneys. The rankings are based on technical legal ability, professional conduct, client service, commercial astuteness, diligence, commitment and other qualities most valued by clients.

Casey Shark Tank
The 7th Grade Academy Shark Tank Panel including Kevin R. Casey, second from right

Kevin Casey served on a panel of judges for Malvern Preparatory School’s “Shark Tank Challenge.” Malvern’s seventh-grade Academy students created an improved packaging design for a product of their choice that resolves the environmental issue of wasteful packaging material. The students also used graphic design to create a brand and logo for their packaged product. The judging panel, made up of professionals with engineering and educational expertise, gave feedback on the environmental and economic benefits of each design. 

Patrick Kingsley spoke at the 40th Annual Meeting & Seminar program hosted by Surety Claims Institute, where he and co-panelist William Pearce of Arch Insurance Company presented “Inter-creditor and Forbearance Agreements,” which featured a discussion on harmonizing the conflicting interests of creditors, sureties, lenders, banks and owners before bankruptcy. Pat also presented “Key Bond and Contract Provisions” at a CLE program hosted by Stradley Ronon. The presentation discussed Pennsylvania law addressing the obligations of sureties and their principals. 

Karl Myers was appointed to the board of directors of American Red Cross Blood Services for the Penn-Jersey region, which serves all of Southeastern Pennsylvania and the entire state of New Jersey. Myers also serves on the board’s donor recruitment committee. 

Ben Picker received The Legal Intelligencer’s 2015 Lifetime Achievement Award. The award honors individuals who have had a distinct impact on the legal profession in the state.


Picker Italy
Stradley Ronon Senior Counsel Bennett Picker speaks at a global mediation conference held in the Palazzo Vecchio in Florence, Italy.

Ben Picker was the keynote speaker at a global mediation conference hosted by the newly formed Florence International Mediation Centre and the International Mediation Institute at the Palazzo Vecchio in Florence. The event commemorated the formation of the FIMC, an international mediation service for individual and businesses. On behalf of the American Arbitration Association, Picker also signed a memorandum of understanding with Florence Chamber of Commerce President Leonardo Bassilichi to provide for collaboration in the promotion of mediation internationally.

Ben Picker has been appointed by the International Mediation Institute as a representative to the United Nations Economic and Social Council. The institute is a nonprofit that seeks to promote dispute resolution worldwide. Picker will be working with a U.N. task force promoting a culture of mediation within nations and internationally. He is senior counsel at Stradley Ronon. 

Brandon Riley was appointed to the associate board of City Year Philadelphia. The associate board fosters a network of diverse and action-oriented young professionals to advance the mission of City Year Philadelphia, which is to provide high-impact student, classroom and school-wide support and to help students stay in school.

The posting of information on this website, or the receipt of information by viewers of this website, is not intended to – and does not – create an attorney-client relationship. This website is not intended to provide legal advice, and visitors to this website should refrain from acting on information posted here without seeking specific legal advice from individually qualified counsel.

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