Why ADR?

Alternative Dispute Resolution

ADR provides options – nonbinding mediation and binding arbitration – to determine the outcome of commercial disputes in a private and efficient business setting rather than relying on traditional civil litigation in the court system to do so.

Neutral Third Party

In the case of mediation, a neutral third party with applicable industry and ADR expertise works collaboratively with the parties and legal counsel to evaluate the merits of the dispute and to facilitate a mutually agreeable settlement outcome. In the case of arbitration, a neutral third party with applicable industry and ADR expertise presides over a more formal proceeding that provides the parties a prompt, fair and unbiased opportunity to exchange relevant information, followed by an evidentiary hearing conducted by the arbitrator prior to the issuance of his or her final binding award to decide the outcome of the dispute.

Faster, Less Expensive

When ADR is conducted with the guidance of a qualified third-party neutral, it has proven to produce faster and less expensive outcomes than traditional civil litigation. In fact, a 2017 study published by Micronomics found that it took, on average, 12 months longer to get business disputes to trial in the U.S. District Courts during 2011-2015 than it took similar cases during the same period to get to final award through binding arbitration administered by the American Arbitration Association (AAA).

The district court delays were traced to substantial additional direct and secondary costs and economic losses for the litigants and our country’s economy, which Micronomics estimated to be in excess of $180 million per month nationwide during that same period.

Several other important factors should be considered when choosing between ADR and traditional civil litigation to resolve disputes between businesses. 
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Autonomy, Control and Flexibility

The parties have the ability to provide meaningful input to the third-party neutral regarding the best practices and procedures for the administration of the mediation and/or arbitration, including any adjustments to those practices and procedures when they become necessary to ensure that the ADR process is fair and adequately meets the parties’ needs. ADR proceedings are not dependent on state and federal rules of civil procedure and discovery practices or their caseloads, which are increasingly strained by budget cuts.
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Confidentiality

Mediation and arbitration proceedings are conducted in a private business setting, which is not open to the public or the press. The confidentiality of mediation communications is often statutorily protected. The parties can also agree to and the arbitrator can order further measures when necessary to protect the confidential, proprietary and privileged content of the information exchanged during the proceeding.
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Mediator/Arbitrator
Selection

The parties will actively participate in the selection of a qualified third-party neutral who has the desired industry and ADR expertise and personal characteristics needed to satisfy the unique circumstances of the parties’ dispute, including an unbiased attitude, patience, fairness, decisiveness and availability.
To learn more about the ADR services administered by the American Arbitration Association, please check its commercial and construction industry mediation and arbitration rules and forms at www.adr.org.