Businesses Increasingly Finding Interational Arbitration Too Slow, Too Expensive
Richard Naimark
Photo by Jordan Hollender
Arbitration was supposed to be the solution for international companies seeking to resolve disputes without expensive and drawn-out court battles. But it is starting to look more like the problem.
Once a swift, cost-efficient method of resolving international commercial disputes, the process is now often bogged down in long and costly legal proceedings.
“It now takes longer, costs more and has many more steps in the procedures,” says Joseph R. Profaizer, of counsel to Paul, Hastings, Janofsky & Walker in Washington, D.C. “There is now broader discovery, larger damages requests, longer briefing schedules, much bigger briefs, far greater reliance on experts and their testimony, and more procedural challenges to the arbitration.”
If that sounds suspiciously like U.S.-style litigation, well, that is exactly the problem. Arbitration of international commercial disputes has taken on many of the characteristics of litigation in U.S. courts. And this has upset many companies that rely on arbitration to resolve cross-border business disputes.
“There’s been an increasing chorus of voices that international arbitration is getting too expensive, mostly because it is taking too long,” says Richard W. Naimark, senior vice president of the American Arbitration Association’s International Center for Dispute Resolution.
A growing number of businesses appear to be turning away from arbitration and resolving their international commercial disputes the old-fashioned way—in the courts.
Continue reading International Arbitration Loses Its Grip: Are Lawyers to Blame?
Note: This month’s CLE, “Litigation v. Arbitration in International Business Disputes,” is Wednesday, April 21.
