Hatcher and Gadberry: Mass Arbitration Needs Massive Change
Once heralded as a streamlined alternative to traditional litigation, arbitration has given way to mass arbitration, where a large number of claims are filed simultaneously by a single law firm or coordinated group of firms against a company. The result has proven to be expensive, time consuming and inefficient for companies, according to Shook Partner Jenn Hatcher and Associate Anna Gadberry, and Katherine Heaton, Claims Focus Group Leader – Cyber Services and & InfoSec Claims for Beazley, who co-authored an article on mass arbitration in ACC Docket.
In the article, titled “Mass Arbitration Needs Massive Change,” Hatcher, Gadberry and Heaton said that companies facing mass arbitrations are in a lose-lose situation: either pay substantial up-front costs to arbitration providers or be strong-armed into settling. They discuss the American Arbitration Association’s updated mass arbitration rules and some potential mitigation tactics, such as opting for small claims court.
“The advent of mass arbitration highlights the need for creative and forward-thinking approaches to dispute resolution,” they said. “By critically evaluating arbitration clauses and proactively addressing associated risks, companies can chart a course towards fair and equitable resolution in an era of unprecedented legal challenges.”
