Like the paperless office, online dispute resolution (ODR) was an early goal of those embracing online communication. Unlike the paperless office, however, whose arrival has been somewhat delayed by the principle that anything made easier, eg printing, will be done many more times than otherwise would be the case, ODR has indeed arrived. “Where is it?” you may ask. All around. Stop looking for a product and think, instead, about the definition.
James Rustidge, the first full-time court mediator, was not told not to use email. So he used email. He then delivered more settlements than he had managed to do previously, using in-person mediations. James is now this country’s leading ODR practitioner. He just didn’t know it until I told him!
For many, ODR conjures up, at the one end, use of general technologies such as video conferencing, and at the other end, dedicated tools such as blind bidding and artificial negotiating aids. Reaction to ODR is often, at best, something to keep an eye on for the future, and at worst, “I prefer the personal touch”. Suggest, on the other hand, that digital technology should be used to aid legal practice, and most would readily agree. It is not unusual, for example, to find international arbitration services using video conferencing and email when in-person arbitration becomes impractical. This is hardly surprising given that distant arbitration is as old as paper itself.
Am I widening the goalposts? Of course. In mitigation I will say two things. Firstly, defining ODR purely in terms of its “bleeding edge” creates an artificial view as to progress. Is using a VoIP phone via your wi-fi, not still “using a computer”? Dedicated ODR is simply the more advanced use of ODR. Secondly, I have not widened the posts as much as I could, since I am not including online case management systems such as Money Claim Online. To be included in my definition, there has to be some communication by the parties beyond the pleading that forms part of the dispute resolution itself.
So now we know what we are talking about, just what systems for ODR are available?
Aids to negotiation between the parties
Cybersettle’s blind bidding system was the first dedicated technique. It was very good. Whilst many of us then began to build our own blind bidding systems, extensive patent rights obtained by Cybersettle led to a showering of cease and desist letters. All recipients complied, with the exception of the National Arbitration Forum, who this year suffered a reverse in court to their challenge to the Cybersettle patent.
The patent has restricted the expansion of blind bidding to the agenda of one company. One of the greatest attractions of blind bidding to UK defendants is the incentive to make a higher offer early when costs are low (less in total than a lower but later offer) safe in the knowledge that their negotiating position is not compromised. But whilst it is successful in the US, it is not really successful elsewhere.
The patent is not the sole reason, since Cybersettle have also failed in the UK. There is another hurdle. Over five years ago, I ran a blind bidding pilot for an insurer. The claimant lawyers did not want to play. Cynics might argue that early settlement at times of low chargeable hours threatens fee targets (in the USA, attorneys charge a percentage of the damages). Perhaps fixed costs here will have the same effect.
Artificial intelligence systems, such as SmartSettle, require the parties to value the significance of components to the dispute and then the program will suggest solutions. The main problem is that, like a computer game, it may prejudice the novice user: it takes time to use these systems effectively. In addition, they appeal more to non-lawyers whose professional skills are not challenged. As such they are currently off our radar but I believe they are paving the way to the cyber judge of the future.
Although the most obvious use of ODR is to provide mediation to those who cannot participate in person, it can also help the mediator to clarify and narrow the issues and better empathise with the parties before the meeting, even in a normal resolution. An online mediator can be available throughout litigation to help resolve issues at any time. My own company, TheMediationRoom, has introduced a concept called anonymous brainstorming, whereby any person can post suggestions which are then considered on an objective basis. Online mediation has the opportunity to expand mediation itself.
The busiest provider is Square Trade for its speedy resolution in eBay disputes. TheMediationRoom.com has been adopted by two US government agencies as well as the Law Council of Australia and the Commonwealth Telecommunications Organisation. Over 50 mediators have taken the training course created in collaboration with the ADR Group, who themselves have had such a success with an online adjudication pilot for PayPal, using our software, that they have now been contracted onto a second level of pilot involving retailers.
In another field, Jim Melamed of Mediate.com reported to the recent 5th International Forum on ODR that US divorce-related disputes were being settled online in half the time of traditional mediation. (Videos of all presentations are available at TheMediationRoom.com.)
Has ODR taken off? Not quite but there are interesting developments all around.
Graham Ross is a solicitor and mediator. He co-founded the UK’s first blind bidding service, WeCanSettle, and now heads TheMediationRoom. He is a member of the United Nations Expert Panel on ODR and was host this year of the Panel’s 5th International Conference in Liverpool.