ARBITRATION'S E-DISCOVERY CONUNDRUM: Dealing with Complex Evidence Problems in a Streamlined ProcessArticle by Thomas L. Aldrich In the opinion of Thomas Aldrich, the arbitration process has become mired in a legal morass of runaway document discovery and e-discovery, which has largely nullified the long-recognized benefits of speed, efficiency and cost savings that originally made arbitration an attractive alternative to litigation. [1] He also argues that because the process has become more cumbersome, time-consuming and expensive, arbitration is developing into a less desirable alternative to other ADR processes such as mediation. [2] Given these concerns, Aldrich’s article focuses mainly on the efforts of arbitral institutions to restore the benefits of arbitration without compromising fundamental fairness. To this end, Aldrich starts with a look at the development of e-discovery rules and their interplay with the rules of these various institutions. Aldrich begins with a discussion of the 1925 Federal Arbitration Act (“FAA”), which created a body of federal law that recognized contracting parties’ obligations to honor a private agreement to submit a dispute to arbitration. Though the FAA allowed arbiters to subpoena witnesses and documents for testimony, it made no specific pronouncements about prehearing discovery. Aldrich suggests that under this law one could infer that no right to discovery exists unless the parties contract otherwise. Aldrich also makes mention of the 1955 Uniform Arbitration Act which was also silent with regard to discovery. [3] Next he discusses the 2000 Revised Uniform Arbitration Act (“RUAA”) that has several clearly delineated provisions addressing discovery. Though the RUAA it allows the arbitrator to define the scope and breadth of the discovery, Aldrich is quick to point out that arbitrators often accede to a party or parties’ requests for expansion of discovery right up to the point that it closely resembles those in court. With these issues at the forefront of the dialogue, Aldrich reviews the approaches being used by certain arbitral institutions to resolve this expanding problem and ultimately renders his opinion on the future viability of arbitration: The Draft Conflict Prevention and Resolution Protocol: Aldrich first addresses the protocol promulgated by the International Institute for Conflict Prevention and Resolution (CPR). Its arbitration committee has proposed new guidelines that attempt to temper the ability of parties to conduct massive discovery – electronic or otherwise – by not only requiring a narrow focus in the discovery requests but also through demanding a balance between the burdens, costs and accessibility of the requested information. The CPR protocol can be further broken down into four “modes:” Mode A, Mode B and Mode C. Mode A is the narrowest in scope and only requires parties in an arbitration hearing to disclose the documents it intends to present in support of its case. Mode B provides that each side must produce e-documents maintained by an agreed limited number of designated custodians, that the disclosure be limited to e-documents created from the date of signing the arbitration agreement to the date of filing the request for arbitration. Similar to Mode B, Mode C also allows for discovery of documents from certain custodians but increases both the number allowed and the applicable time period. It also allows for documents obtained through other forensic methods to be admitted for consideration. Finally, Mode D allows for a broad discovery and only has limitations similar to those of the Federal Rules of Civil Procedure under Rule 26. [4] Chartered Institute Protocol: According to Aldrich, the Chartered Institute Protocol (CIP) for E-Disclosure in Arbitration has much in common with its CPR counterpart. This includes early consideration of the conduct the discovery; agreements by the parties to limit the scope and extent of production; reduction of the cost and burden of production; and placement of the ultimate burden of persuasion on the requesting party. [5] Unlike the CPR, however, the CIP’s fails to provide detailed choices regarding potential methods of document production by the parties. Aldrich suggests this could be a serious shortcoming. International Centre for Dispute Resolution Guidelines: Aldrich next examines the International Centre for Dispute Resolution’s (ICDR) guidelines for arbitration. Though the stated principles align with those of the protocols already discussed, the guidelines offer very limited suggestions for dealing with runaway discovery. Instead, the guidelines state succinctly that “[t]he tribunal shall manage the exchange of information among the parties in advance of the hearings with a view to maintaining efficiency and economy ... [by] avoid[ing] unnecessary delay and expense, while at the same time balancing the goals of avoiding surprise, promoting equality of treatment, and safeguarding each party's opportunity to present its claims and defenses fairly.” [6] In fact, the guidelines only require three things: (i) that document requests be narrowly focused and structured to avoid unnecessary expense; (ii) that documents upon which the parties intend to rely must be produced; and (iii) that any documents disclosed must be produced in the form they are maintained (absent, of course, a clear need for a different form). International Bar Association Rules: Similar to the IDCR guidelines, the International Bar Association’s (IBA) Rules on the Taking of Evidence do little in concrete terms to ameliorate the discovery issues in arbitration. In Article 3, Section 2 of the Rules, however, is language that states that any requests for documentation may be excluded on grounds of relevance or materiality, legal impediment or privilege, unreasonable burden to produce, or considerations of fairness or equality that the tribunal determines compelling. Aldrich argues that a savvy arbitrator could use this language to avoid costly and time-consuming fishing expeditions by the parties. [7] Conclusion: Ultimately, Aldrich’s examination yields a conclusion that the only way to restore the virtues of efficiency, cost-effectiveness, and speediness to arbitration without compromising its fairness is for the parties to arbitration agreements to make effective use of the protocols and guidelines available to them. Moreover, Aldrich argues that arbitrators themselves must be willing to exercise the discretion granted to them by arbitration agreements. [8] Thomas L. Aldrich, Arbitration’s E-Discovery Conundrum: Dealing with Complex Evidence Problems in a Streamlined Process, 31 Nat’l L.J. S1 (2008). |