1. Result Risk: The possibility of losing in arbitration and having to pay the prevailing party’s attorneys’ fees should be considered.
2. Customization: Arbitration allows for a high level of customization based on the agreement of the parties involved.
3. Overall Strategy: Companies should have a clear strategy for when to insist on arbitration and when to negotiate against it in order to manage risks and costs.
4. Public Policy and Legislation: The customization of arbitration is limited by public policy and legislation.
5. Finality: The concern about finality in arbitration may outweigh other factors if the risk of losing is substantial.
6. Alternative Dispute Resolution: Arbitration is a viable alternative to traditional court litigation for resolving disputes. – Arbitration allows for the identity of adjudicator to be predetermined, whereas a jury trial does not.
– The cost of arbitration may be less than a jury trial, but it can still be expensive, especially if it involves multiple arbitrators and extensive hearings.
– Arbitral proceedings typically move at a faster pace than court calendars, which can be both positive and negative.
– Arbitration awards are generally final, with limited rights to review or appeal. 1. Arbitration is generally better at maintaining confidentiality than the court system, especially when dealing with highly confidential information like trade-secrets or proprietary information.
2. Courts are open forums by nature, making it difficult to protect trade secrets during litigation.
3. While arbitration is often the preferred choice for confidentiality, it may not be the best option for every dispute. Companies should carefully consider their specific circumstances before requiring arbitration for all disputes.
4. Companies should consider consulting with outside counsel to determine the best approach for drafting specific arbitration provisions.
https://www.rumberger.com/insights/arbitration-embrace-it-or-avoid-it-considerations-for-small-businesses/
Leave a Reply