By Ryan Boonstra
ALR Senior Editor, 2018-2019

Electronic arbitration, or “e-arbitration” as it is more commonly known was once defined as classic arbitration which is “‘conducted wholly or substantially online . . . includ[ing] filings, submissions, hearings, and awards being made or rendered online’.”[1]  However, the more modern definition is broad and includes any arbitration that utilizes electronic submissions, or uses teleconferencing or video conferencing to conduct the hearing process.[2]  From either definition it is clear that e-arbitration is the same as traditional arbitration in procedure and process, but it involves some form of electronic medium in part or in whole.

When this type of arbitration first arose, there were questions surrounding its enforceability from two different angles.  The first, more concerning argument, was that electronic arbitration clauses were most commonly seen in digital contracts, such as licensing agreements, and due to their solely digital nature, they violated the “written provision” requirement of the FAA.[3]  However, these concerns were quickly dealt with by courts who concluded that under the Federal Electronic Signatures in Global and National Commerce Act, electronic signatures were just as sound as formal signatures and would give legal effect to electronically signed arbitration agreements.[4]  The second challenge to enforceability was similar in that plaintiffs argued the clauses were buried too deep within agreements for the signee to even know that they were there.[5]  This was also quickly dealt with by those drafting the agreements, they simply bolded the arbitration clauses, included them on the first page, or required a separate additional signature for the clause so that the consumer was put on notice to its existence.[6]

So why choose e-arbitration?  In his article, Paul Breaux[7] summarizes e-arbitration’s advantages perfectly by stating, “[t]he numerous advantages to e-arbitration versus traditional arbitration include the speed within which the entire process can be conducted, its cost-effectiveness, its accessibility and availability, and its case management efficiency.”[8]  These benefits are being embraced by arbitration services and creating arbitration service companies with a focus solely on e-arbitration such as Unum.[9]  Unum more thoroughly explains the electronic benefits by outlining how clients receive real-time updates about filings and decisions.[10]  These notifications are received by all clients involved, simultaneously, no matter where they are in the world, and are password protected.[11] Security is perhaps one of the only drawbacks to e-arbitration since the databases that conduct and maintain the documents can be compromised by malicious third parties.[12]  Another possible drawback is that not all attorneys are ‘tech-savy’ for lack of a better term and it is important to understand the digital platform being utilized in order to best represent a client.[13]

Outside of those drawbacks, both of which will be fixed with time, e-arbitration is a highly efficient model for clients interested in resolving matters quickly and it will continue to grow as technology does.

[1] Paul W. Breaux, Feature: Online Dispute Resolution: A Modern ADR Approach, 62 LA Bar Jnl. 178, 180 (2014) (quoting Mohamed S. Abdel Wahab, “ODR and E-Arbitration,” Online Dispute Resolution Theory and Practice, Chapter 18 (May 2013), www.mediate.com/pdf/ebnerl.pdf).

 

[2] Id.

 

[3] Jason E. Bring & W. Jerad Rissler, Are Electronic Arbitration Agreements Enforceable?, LAW360 (June 01, 2012).

 

[4] Id.; Campbell v. General Dynamics Gov’t Sys. Corp., 407 F.3d 546 (1st Cir. 2005)

 

[5] See Paul W. Breaux, supra note 1, at 181.

 

[6] Id.

 

[7] Paul W. Breaux is the chair of the Louisiana State Bar Association’s Alternative Dispute Resolution Section, an adjunct professor at Louisiana State University Paul M. Hebert Law Center teaching the Civil Mediation Clinic, and the owner of Peacemakers Mediation Service, L.L.C., in Baton Rouge. See Id.

 

[8] Id.

 

[9] Unum is an Alternative Dispute Resolution company that has a completely electronic platform for arbitration and mediation allowing its clients to resolve their disputes completely electronically.  See UNUM, About Unum, https://unum.world/about-unum/ (last visited Dec. 19, 2018).

 

[10] See UNUM, Arbitration, E-Arbitration, https://unum.world/arbitration/e-arbitration/ (last visited Dec. 19, 2018).

 

[11] Id.

 

[12] See Paul W. Breaux, supra note 1, at 181.

 

[13] Id.