Moderated by Loïc E. Coutelier
The Decay of Commercial Arbitration
The promise and benefit of arbitration versus litigation are getting smaller day-by-day. Escalating costs and long waiting times caused by administrative inefficiencies - manual handling of documents, letters, payments, and scheduling - are making the process financially viable only for large claims. As a result, businesses are turning away from arbitration and steering toward a high stakes game of legal proceedings, with no possible assurance of success.
The Rebirth of Commercial Arbitration
Modria is offering the world's first end-to-end online arbitration platform. The Modria Resolution Center is the most comprehensive, efficient, streamlined, and secure arbitration system ever created. Our platform was built by former ICC Court of Arbitration staff, and in collaboration with Institute for Conflict Prevention and Resolution in New York. We have successfully managed to keep the promises of arbitration: fast process, lower costs, and foreseeability offered to disputants.
How We Do It
We studied the commercial arbitration process in great detail to identify its pain points and vulnerabilities. We then crafted a true end-to-end online solution that ensures fair outcomes for ALL parties. The Modria Resolution Center’s secure platform allows users to make payments, select arbitrators, manage documents, negotiate, and much more – all online. With any internet connection you have 24/7 access to everything you need in one convenient place. Our state-of-the-art security ensures you never have to worry about the privacy of sensitive files and communications.
Enjoy these two videos to learn more about our product. You will also find a PDF of a powerpoint attached to the bottom of this page.
Loïc is the Director of Arbitration at MODRIA.COM, INC., the worldwide leader in designing and implementing online dispute resolution systems to improve existing dispute resolution processes, reinforce trust on the internet, and provide better access to justice. He specializes in international arbitration, algorithmic dispute resolution, and general institutional case management. Loïc is also a lawyer admitted to the New York State Bar.
Prior to joining Modria, Loïc was the Gould Centre Research Fellow at Stanford Law School. His research concentrated on issues relating to inter alia international arbitration, international trade regulation, mediation, online dispute resolution, dispute systems design, and transitional justice. Originally from France, Loïc joined Stanford after successfully completing an LL.M. program in International Economic Law, Business and Policy. Prior to moving to California, Loïc was working as a Deputy Counsel at the Secretariat of the ICC International Court of Arbitration in Paris and in Hong Kong, where he administered arbitration cases between parties from Europe, the Middle East, Africa, Asia, the Pacific region, North America, and Eastern Europe. Loïc was also involved in the design and development of a case management platform for the ICC.
Loïc studied in France and Scotland. He worked briefly with law firms in Scotland and Spain. He graduated valedictorian from his masters program in arbitration and international business law from the Versailles Law School. Loïc is the author of several scholarly articles on international arbitration in France, the United States, and China.
I see that a few dozen of people viewed this discussion already. I hope that you have all been able to view the videos and document that have been put up. Please let me know if you have any question regarding said documents, or whether you would like to schedule with me an online demonstration of the product.
To start the discussion, I would like to put the first question out there: in your opinion, for an online arbitration system to be absolutely successful and efficient for arbitration practitioners, an online arbitration system should contain:
- Discussion thread?
Looking forward to an interesting discussion.
Thanks for kicking off the discussion. I think at the absolute minimum text interaction is adequate -- but payments and video are definitely valuable features to have as an option. We've never really had an ODR platform with powerful and easy to use video and audio conferencing.
I'm curious about a few other features as well, particularly those that are relevant to face-to-face processes: calendaring, scheduling, etc. In purely online processes, these tools are not really necessary. But I suspect that many of these processes, particularly in higher value disputes, will be hybrid online/offline. So maybe we need to include tools that make straddling the online/offline gap easier to manage.
Eager to hear thoughts from Cyberweek attendees!
I like this tool. I think automatic notification if in this is to be used in an asynchronous method is a must. Video conferencing with a text window much like the Wimba platforms but on steroids would be ideal. A discussion thread and enforcement of deadlines is a must. I think you could even allow users to choose the arbitrator they would like to use, by allowing a user to place their case online and having arbitrators bid on hearing it. This in turn could help ease costs, which are very high. Some disputes need to be solved but are not worth the price that arbitration costs therefore they tend to go unsolved with bitterness between both parties. Helping to cut this down could be a huge advancement in the ODR world.
thank you very much for your response, and your valuable insight. I also think that asynchronous notification, video chat, conversation, time management, are necessary. From the institution's perspective, the online payment is crucial I believe, as if would save the latter a lot of time.
Regarding the arbitrators' bidding for cases, I never thought of such a system, and as you explained, it could be very useful for disputants looking for cheaper arbitration costs. Obviously, we would have to build in safeguards to make sure that disputants know about the qualification and reputation of these arbitrators. By holding the fees in an escrow until the services are rendered, we would also guarantee that some unknown and unscrupulous persons take advantage of desperate disputants.
Do you believe that document only, or baseball arbitration style could help reduce costs and time?
I guess I am not following when you say document only or baseball style arbitration. Could you elaborate more?
I agree with you regarding the need to check backgrounds on arbitrators. I think this however could be quite simple. A rating system and a background check done by the organization could help eliminate issues as well as holding funds in escrow as you described. Think of it like an Angie's List for arbitrators. A place where they benefit as well as the disputants. An arbitrator should know that taking advantage of someone could hurt thier reputation and ruin any future business from the site whereas those who do a good job and do it quickly could not only help advance ODR but make a small fortune on the site. What this does for you, is help keep your overhead down as you have very few employees. Your company could grow financially by taking a small percentage of the costs and/or charging arbitrators that sign up?
thank you for your follow up message, the contents of which are duly noted. My comments regarding other forms of arbitration were directly related to the issue of keeping costs down. Document-only arbitration is an arbitration in which the parties will post all the documents they want; then the arbitration consults them, and renders a decision, without ever talking to the parties or holding a final a hearing (there are several variants of this process). By reducing the amount of time the arbitrator has to work, and the length of the process, we are keeping the costs down.
The same goes with baseball arbitration: both parties will submit the amount for which they believe the matter should be decided, and the arbitrator will pick which of the two solution he/she feels is the best. In the "night baseball arbitration" variant, the arbitrator determines the number (he basically renders the award) without knowing what the parties have chosen, but the final number is the one of Claimant or Respondent which is the closest.
These processes are extremely useful in the instance of small claims. Do you see value for these?
I agree with you by limiting the amount of time an arbitrator has to work you can keep costs down. I dont think either would work in terms of giving people a warm and fuzzy feeling. You have to leave room for rebuttals and closing statements. I would think setting it up in terms of what a trial is like. For instance have a step by step checklist that would go in order.
Document submission by both parties
Review of documents by other party
answers to claims by other party
Review by arbitrator
By giving people a chance to review the documents by others, this could weed out weak cases. If someone sees that another has a strong case, most people would know immediately that they are going to lose. By offering a tier payment system that if a settlement is achieved within the first 48 hours the cost is say 25% less for the arbitrator, you could limit costs to the consumer and limit the time spent on the case by the arbitrator.
If I can help in any way I would love to get my hands involved in moving ODR to the legal field and maybe you can help bring it to the manufacturing field.