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Archive for July, 2009

Should the States Certify and Regulate Mediators?

July 30th, 2009 Mediation, Reinsurance Mediation 4 Comments »

One of the reasons we enjoy reading the Mediation Channel so much is that Diane Levin’s posts are designed to make you think.  In her recent post, “To Certify or Not to Certify:  That is the Question as the Mediation Field Struggles with Professionalization,” she discussed a number of arguments for and against state licensing and regulation of mediators.  (A copy of the post is here.)   I found this post to be particularly thought provoking. 

From what I have heard (and I am not a mediator) state regulation of mediators is a controversial subject.  And it should be.  Continue Reading »

The LinkedIn Commercial and Industry Arbitration and Mediation Group is 200 Members Strong!

July 24th, 2009 Commercial and Industry Arbitration and Mediation Group, General 1 Comment »

On May 21, 2009 Disputing and the Loree Reinsurance and Arbitration Law Forum announced the formation of a LinkedIn Commercial and Industry Arbitration and Mediation Group (post available here), an open forum for the discussion of industry and commercial ADR.   At that time the group was 29 members strong, and we are pleased to report that the group has since grown to 200  members.  Discussions have been lively, the group is internationally and professionally diverse, and group members have access to several ADR blogs, as well as articles posted by other group members.  It is an excellent networking and learning opportunity for anyone interested in commercial and industry ADR.

Membership in the group is useful to those of us that are following the unfortunate developments plaguing consumer debt arbitration, and for those who want to keep abreast of  judicial and legislative developments relevant to arbitration law.   A number of industry arbitrators, attorneys, industry people  and arbitration professionals are members. 

Mediation is another key area that is the subject of group discussions and the posting of articles.  The group is proud to have as members a number of accomplished mediators.  Not being a mediator myself, I have learned much about mediation simply through group participation.    

We welcome new members.  Persons who should consider joining this group include arbitrators; mediators; in-house and outside counsel; law professors; dispute-resolution consultants; members of ADR organizations; business entity representatives and principals whose day-to-day responsibilities include dispute resolution; law students and other students of commercial and industry ADR; and anyone else interested in the subject.  The Group is not a forum for, and does not permit, advertising or blatant self-promotion, so our members need not worry about being subject to sales pitches, and the like. 

If you are already a member of LinkedIn, please click here to apply for membership in the Group. If you are not a LinkedIn member, click here, and you will be guided through the process of creating a profile (which does not have to be completed in one step).  Once your profile is started, and you have a log-in name and password, you can apply for membership in the Group (which entails no more than clicking on a button).  Joining LinkedIn is free, as is joining the group.

We hope you’ll join us and participate!

The Texas Supreme Court Says Court – Not Arbitrator — Gets to Decide Lack of Capacity Issue Notwithstanding the Severability Doctrine

July 21st, 2009 Arbitrability, Authority of Arbitrators, Texas Supreme Court Comments Off on The Texas Supreme Court Says Court – Not Arbitrator — Gets to Decide Lack of Capacity Issue Notwithstanding the Severability Doctrine

Karl Bayer’s and Victoria VanBuren’s Texas-based  Disputing blog recently reported on In re Morgan Stanley & Co., Inc., __ S.W.3d __ (Texas 2009) (No. 07-0665), in which the Texas Supreme Court held that whether a contracting party had the capacity to enter into a contract containing an arbitration agreement was for the court to decide, notwithstanding that, under the severability (a/k/a “separability”) doctrine, a challenge to the validity or enforceability of a contract as a whole, including the arbitration agreement, is generally for the arbitrators to decide under a broad arbitration clause.  Ms. VanBuren did an excellent job summarizing the case and explaining its significance in her post, “Texas Supreme Court Holds that the Court, not the Arbitrator Should Decide the Issue of Capacity to Contract,” and we recommend that anyone interested in learning more about the case read her thoughtful and nicely-written post. 

Morgan Stanley illustrates that the severability doctrine —  first espoused by the United States Supreme Court in Prima Paint v. Conklin Mfg. Corp., 388 U.S. 395, 403-04 (1967) and later clarified in Buckeye Check Cashing v. Cardengna, 546 U.S. 440, 449 (2006) — is not without its limits.  Severability is a legal fiction, which Courts apply for the purpose of determining whether arbitrators have the authority to determine certain disputes concerning the enforceability or validity of a contract containing an arbitration clause.  It deems the arbitration clause to be an agreement which stands on its own footing from the contract in which it is contained.  Continue Reading »

Loree Reinsurance and Arbitration Law Forum and Four Other ADR Blogs Make Diane Levin’s “Top Five Tuesdays” List Of New ADR Blogs

July 19th, 2009 Commercial and Industry Arbitration and Mediation Group, General, Reinsurance Arbitration, Reinsurance Mediation Comments Off on Loree Reinsurance and Arbitration Law Forum and Four Other ADR Blogs Make Diane Levin’s “Top Five Tuesdays” List Of New ADR Blogs

Each Tuesday the National Arbitration Forum Blog features a “Top Five Tuesdays” guest-blog submission.  The guest-blogger submits a “Top Five” list on some topic pertinent to ADR. 

On July 14, 2009 the NAF Blog posted a “Top-Five Tuesdays” submission by master-blogger Diane Levin, entitled “5 New ADR Blogs to Add to Your Reading List.”  (Available here.)  Diane is, among other things, the blog master of the excellent and immensely popular ADR blog, Mediation Channel, and “unofficial taxonomist of the ADR blogosphere” at her popular worldwide blog directory,  ADRBlogs.com.   Noting that she “track[s] and catalog[s] bloggers world-wide who write about ADR, negotiation, and conflict resolution,” Diane said:     

It gives me the ability to introduce new and worthy ADR blogs to readers – like the following five blogs. I hope you enjoy them: 

 

  1. Loree Reinsurance and Arbitration Law Forum provides discussion and insights on reinsurance litigation and arbitration and is published by New York-based boutique commercial and industry arbitration firm Loree & Loree. This blog demonstrates quality writing on newsworthy topics that distinguish the top ADR blog; a recent example is “The AAA Commercial Rules and the Pig in a Poke: Gilbert Street Developers, LLC v. La Quinta Homes, LLC“.
  2. Business Conflict Blog provides perspectives on managing the business disputes that companies around the globe face, a focus reflected in posts such as “Contract Drafting for Dispute Management“, aimed for the transactional lawyer seeking to protect the value of the deal. This blog is written by F. Peter Phillips, a commercial arbitrator and mediator based in New Jersey.
  3. Mediation Matters is published by California lawyer and mediator Steve Mehta, who has translated his experience litigating and mediating complex cases into engaging posts that share his reflections on ADR practice, including this one on his experiences going green to conserve energy at his office.
  4. Cross Collaborate serves as a learning resource for all those involved in shaping or influencing governmental decisions, offering commentary on leading issues and innovative practices. It is published by John Folk-Williams, a practitioner and writer in the field of public policy collaboration and interest-based negotiation. His thoughtfulness as a practitioner is evident in posts like “Power Differences, Consensus Building & Collaborative Networks“.
  5. Disputing: Conversations about Dispute Resolution is a dependable source for news, updates and commentary on the law pertaining to arbitration, with a special focus on Texas demonstrated by posts such as “Texas HB 2256 Makes Possible a New Mediation Procedure for ‘Balance Billing‘”.

We thank Diane for having included us not only in her blog directory, ADRBlogs.com, but also in “5 New ADR Blogs to Add to Your Reading List.”  We also thank Diane for including our friends Karl Bayer, Victoria VanBuren and Holly Hayes at Disputing, and for featuring the other three excellent blogs listed above.   

For the benefit of readers who may not know Diane, she is a mediator, dispute resolution trainer, negotiation coach, writer, and lawyer based in Marblehead, Massachusetts.  She has instructed people from around the world in the art of negotiation and mediation.  Since 1995 she has assisted clients in resolving tort, employment, business, estate, family, and real property disputes, and has served on numerous mediation panels, including the United States Equal Employment Opportunity Commission (a/k/a “the EEOC”).  She has a passion for training and coaching and has taught thousands of people to resolve conflict, negotiate better, or become mediators – from Croatian judges to Fortune 500 executives.

Characterizing herself  — tongue in cheek — as “a geek at heart,” Diane also consults on web design and social media for professionals.  She writes about issues pertinent to ADR at the intersection of law, science and popular culture at Mediation Channel, which is regarded (deservedly so) as one of the world’s top ADR blogs.  She tracks and catalogues ADR blogs around the world at ADRblogs.com, where she has created a community for bloggers writing about alternative dispute resolution.  

Thanks again, Diane!

The Art and Science of Mediation: A Brief Recap of the July 14, 2009 Don Philbin/Randall Kiser/Katherine Billingham ABA Teleconference

July 17th, 2009 Asbestos-Related Claims, Mediation, Reinsurance Mediation Comments Off on The Art and Science of Mediation: A Brief Recap of the July 14, 2009 Don Philbin/Randall Kiser/Katherine Billingham ABA Teleconference

Readers may remember our July 1, 2009 announcement concerning an American Bar Association teleconference on mediation hosted by Don Philbin, Randall Kiser and Katherine Billingham (post here).  The conference took place as scheduled on July 14, 2009, and we thought it was excellent.

Don Philbin and Randall Kiser explained a theory of mediation based on a combination of brain science, psychology, statistical analysis, and computer graphics, which we thought was as inspiring as it was fascinating.  They discussed the results of empirical studies of decisional errors in litigation, comparing last settlement positions of parties who failed to settle to the ultimate outcome of the proceeding.  They explained who did better, who did worst, and what the cost of the error was.  They also described a technique that can overcome psychological barriers to settlement that uses graphically-depicted outcome-scenarios.  Randall discussed a book he is writing, which will explain and advocate a scientific approach to decision making, and which will delve into the legal malpractice considerations associated with poor decision making.  Randall’s book will hit the shelves this fall.

Once upon a time I thought mediation was, to a significant extent, based on “touch” and “feel,” but Don and Randall have proved me wrong.  To some extent it is certainly an art, but science plays an important role, especially when the mediators are trained to use it properly.  

Katherine Billingham discussed a scientific approach to resolve through mediation complex multi-insurer, multi-layer, multi-year asbestos-related insurance coverage disputes, using excellent graphics.  She explained how these disputes can be mediated in a multi-phase process that takes into account nearly every one of the myriad of variables that must be considered.  Her methodology can also be applied to complex reinsurance disputes, which she also mediates.

All in all, there was much useful information packed into the one-hour presentation, and we view it as a springboard for further research and study.  Kudos to all involved!

Feeney v. Dell Inc.: A Critical Analysis

July 17th, 2009 Arbitrability, Class Action Arbitration, Class Action Waivers, Massachusetts Supreme Judicial Court 3 Comments »

Introduction

In part I of a two-part post (here), we summarized the Supreme Judicial Court of Massachusetts’ decision in Feeney v. Dell Inc., ___ Mass. ___, slip op. (July 2, 2009).  The Court there refused to enforce an arbitration agreement in a consumer contract because it contained a class action waiver that the Court found violative of Massachusetts public policy favoring class actions under G.L., c. 93A, and which the Court found not to be severable from the remainder of the arbitration agreement.  The Court also refused to enforce on public policy grounds a choice-of-law clause providing that Texas law — which apparently permits class action waivers — would govern the parties’ agreement.  In this part II we discuss whether the decision comports with the Federal Arbitration Act.

The critical issue in Feeney was whether a state public policy against class action waivers was preempted by the Federal Arbitration Act, the preeminent purpose of which is to enforce according to their terms arbitration agreements falling within its scope.  With all due respect to the SJC, we think Feeney was a tough case and that the preemption issue was a close call.  The Court obviously worked hard to justify the outcome and drilled down on the preemption issue, but at the end of the day its arguments simply proved too much.  Continue Reading »

Feeney v. Dell Inc.: The Massachusetts Supreme Judicial Court Says Class Action Waiver in Arbitration Agreement Governed by the Federal Arbitration Act Violates Massachusetts Public Policy

July 16th, 2009 Arbitrability, Class Action Arbitration, Class Action Waivers, Massachusetts Supreme Judicial Court 3 Comments »

Introduction

The validity of class action waivers in arbitration agreements is a controversial subject at the moment.  There is an obvious tension between the pro-enforcement policies of the Federal Arbitration Act and competing state and federal policies favoring class action arbitration or litigation as a vehicle for vindicating consumer rights.  The United States Supreme Court may provide some hint of where it stands on this issue when it decides the Stolt-Nielsen case (blogged here and here), which raises the related issue whether imposing class action arbitration is consistent with the Federal Arbitration Act when the parties’ contract is silent on that score.  And the Supreme Court may directly address the issue of whether class action waivers comport with federal policy if it decides to grant certiorari in the American Express Merchants’ Litigation (blogged here).  Today we examine a case in which the question was whether a state policy in favor of consumer class actions could trump the enforcement of an arbitration agreement containing a class-action waiver. 

On July 2, 2009, in Feeney v. Dell Inc., ___ Mass. ___, slip op. (July 2, 2009), the Massachusetts Supreme Judicial Court (the “SJC”) ruled that a class action waiver contained in a consumer arbitration agreement violated a fundamental Massachusetts public policy favoring class actions, even though the parties had agreed that Texas law, which allows class action waivers, would govern their agreement.  This violation of Massachusetts public policy, said the Court, rendered the arbitration agreement unenforceable because the class action waiver was unenforceable and could not be severed from the remainder of the arbitration agreement.  But, in an interesting turn of events, the Court dismissed the consumers’ claims with leave to replead, because they failed to state a claim under Mass. G.L., c. 93A, the applicable consumer protection law. 

The case is somewhat different from other decisions voiding class action waivers because the agreement was voided on state public policy grounds, rather than on state unconscionability grounds, and because the court refused to enforce not only the class action waiver but also a choice-of-law clause indicating the parties’ desire that Texas, not Massachusetts, law would govern the class action waiver issue.  The case gives rise to serious questions concerning federal preemption of Massachusetts state policy. 

In this part I of a two-part post, we summarize the Feeny case.  In part II, which will follow tomorrow or the next day, we shall provide our critical analysis.  Because the publicly available copy of the case does not feature official pagination, we have eliminated jump cites, but provide after quotes pertinent information about internal citations, quotations and the like.    Continue Reading »

Travelers Indemnity Co. v. Bailey: United States Supreme Court Holds 1986 John-Manville Bankruptcy Court Injunction Bars Direct Asbestos-Related Claims Against The Travelers

July 8th, 2009 Asbestos-Related Claims, United States Supreme Court Comments Off on Travelers Indemnity Co. v. Bailey: United States Supreme Court Holds 1986 John-Manville Bankruptcy Court Injunction Bars Direct Asbestos-Related Claims Against The Travelers

Introduction

On June 18, 2009 the United States Supreme Court ruled 7-2 that an injunction (the “1986 Injunction”)  incorporated into the 1986 Johns-Manville Corp. (“Manville”) bankruptcy reorganization order (the “1986 Order”) barred claims made directly against Manville’s insurer, the Travelers Indemnity Company (“Travelers”), even though those claims were derivative of Travelers’ alleged wrongdoing, as opposed to that of Manville.  See Travelers Indemnity Co. v. Bailey, ___ U.S. ___ (June 18, 2009) (Souter, J.) (copy available here).  The Court held that:  (a) the claims fell within the terms of the 1986 Injunction; and (b) the claimants were barred by res judicata from collaterally attacking the Bankruptcy Court’s subject-matter jurisdiction to enter the 1986 Order containing the 1986 Injunction.  Slip op. at 1-2 & 9-10. 

The decision should bring some degree of finality to Manville’s insurers’ exposure to asbestos-related claims, which has been a moving target for quite some time.  The effect, if any, the decision may have on reinsurance claims and disputes is not yet clear.  That said, now that Travelers’ liabilities presumably can more easily be quantified, cedents, retrocedents, reinsurers and retrocessionaires whose claims and liabilities are derived from Travelers’ and other Manville insurers’ liabilities might be in a better position to attempt to settle or commute those claims and liabilities.  And, in a more general sense, the decision provides some guidance on how bankruptcy-court channeling-injunctions should be interpreted, and the extent to which, if at all, such injunctions may be collaterally attacked for lack of subject-matter jurisdiction.  Continue Reading »

Upcoming ABA Mediation Teleconference Featuring Don Philbin and Katherine Billingham

July 1st, 2009 Commercial and Industry Arbitration and Mediation Group, General, Mediation, Reinsurance Mediation 1 Comment »

On July 14, 2009 LinkedIn Commercial and Industry Arbitration and Mediation Group co-manager Donald R. Philbin Jr., group member Katherine Billingham, and Randall Kiser from DecisionSet®, will be presenting at a one- hour live teleconference and webcast entitled  “Deal or No Deal: Improving the Odds of Successful Mediation.”  Randall’s article Lets Not Make a Deal: An Empirical Study of Decision Making in Unsuccessful Settlement Negotiations was featured in the New York Times. 

The program is sponsored by The American Bar Association Section of Litigation Alternative Dispute Resolutions Committee, Pretrial Practice & Discovery Committee, Trial Practice Committee, and Commercial & Business Litigation Committee and the ABA Center for Continuing Legal Education. 

As readers may know, Don is an arbitrator, mediator, negotiator, attorney, and business consultant, whose website is here.  In addition to his other work Don frequently writes and speaks on topics pertinent to ADR, and is an adjunct professor at Pepperdine University Law School’s prestigious Straus Institute for Dispute Resolution.  Katherine Billingham is an attorney, reinsurance consultant, an ARIAS-U.S. certified arbitrator and mediator, and principal of KB ReSolutions, Inc, whose website is here.  She also holds ADR certifications at the American Arbitration Association and the Reinsurance Association of America.  Randall Kiser is the principal analyst at DecisionSet®, a decision services company, whose website is here.  He designs quantitative models for DecisionSet® and works with attorneys, litigants, insurers, and advisors in assessing risks and evaluating litigation alternatives.   

Check out the coverage in Disputing, here, which features links to two of Don’s recent articles, including one published in the Harvard Negotiation Law Review.  Find out more about the event, and how to register, here.