ADR Is Just So Analog Dispute resolution goes high-tech with ODR The Recorder By Robert J. Ambrogi November 24, 2004 The range of potential disputes in the virtual world is as wide as in the tangible one -- copyright or trademark infringement, misappropriation of trade secrets, defamation, fraud, deceptive trade practices, invasion of privacy -- the list grows ever longer. In 1996, operating on the assumption that disputes that arise online are best resolved online, a group of trailblazers established the Virtual Magistrate, a forum for online arbitration and fact-finding. Proceedings were to be conducted entirely by e-mail and moderated by an impartial magistrate drawn from a pool of neutrals with experience in computer and Internet law. But when the Virtual Magistrate issued its first decision -- an unenforceable default judgment against the nonparticipating America Online Inc. in favor of a complainant who was affiliated with the Virtual Magistrate -- it drew controversy, and by and large, became dormant. It lives on, now hosted by Chicago-Kent College of Law, at www.vmag.org, but remains largely inactive. However, other online ADR programs have sprung up in its wake. In fact, this field of dispute resolution has come to have its own name -- online dispute resolution, or ODR. A superb resource for keeping track of developments in this field is at ODR.info, www.odr.info, the newest home of the Center for Information Technology and Dispute Resolution at the University of Massachusetts, Amherst. It exists to explore the use of technology and the Internet in dispute resolution. Directed by professors Ethan Katsh and Janet Rifkin, the center has been an innovator and leader in ODR since the early days of the Web. On the site, the center publishes a Web log about ODR as well as a newsletter, ODR Monthly, and hosts an electronic discussion list about dispute resolution. The center has ongoing programs of study and research and also offers consulting services to other organizations that want to develop online ADR programs and resources. ODR PROVIDERS A number of companies, organizations and individuals provide ODR services. Here are three, each with different approaches: • Cybersettle, www.cybersettle.com, works with insurance claims. Ever think that if you could cut through all the posturing and bureaucracy involved in insurance claims, you could settle them more easily? That is the general idea behind Cybersettle, an automated, online tool for resolving insurance claims. Either an insurer or a claimant can initiate the process. Cybersettle then invites the other party to participate. If it agrees, the two sides are given three opportunities -- or rounds -- to settle. For each round, each side submits an offer or demand. Software automatically compares these, and adds 20 percent to the plaintiff's minimum demand to create a "range" of settlement. If, in any given round, the maximum offer is greater than or equal to the minimum demand, the claim will settle for the average of the two amounts. Started by two former trial lawyers, Cybersettle now has the participation of a number of insurers and self-insured companies. Parties pay only if they successfully reach a settlement, and fees range from $100 to $300. • iCourthouse, www.i-courthouse.com, is a sort of virtual judge and jury, providing online jury trials. Parties submit opening and closing arguments, documentary evidence and "testimony" (written statements) -- all collected into a "trial book." Jurors (any Web surfer who registers) select the cases they would like to decide from a docket of open cases. They review the contents of the trial books and are able to post questions to the litigants. After all the jurors have rendered their verdicts, the parties receive a verdict summary that includes the number of votes cast, the median award to the plaintiff, if any, and a compilation of juror comments about the case. The parties can choose whether the verdicts are to be binding or advisory. This, of course, assumes both parties agree to the proceeding in the first place because iCourthouse has no way to coerce defendants to participate. Of far greater interest is the JurySmart feature. It helps lawyers test the strengths and weaknesses of a case by previewing it to a pool of Web jurors. Upon completion, they receive a written report of the results, which includes each juror's verdict, comments and questions, along with a profile that includes each juror's age, sex, occupation, education and annual income. At a cost of $189 per report, this is an economical way to assess the merits of a case. • SquareTrade, www.squaretrade.com, is the place people can go when an eBay sale goes sour; the auction site refers users to SquareTrade to help resolve disputes. SquareTrade uses unique technology and a roster of 250-plus trained mediators to provide ODR. (Full disclosure: The author is a SquareTrade mediator.) SquareTrade uses a two-tiered process. Parties begin with the Direct Negotiation tool and exchange messages using a secure case page. The Direct Negotiation tool suggests possible resolutions and helps parties work directly with each other toward resolution. If this first tier fails to resolve the dispute, the parties can request a mediator to assist them in coming to terms. All communication is done via the case page. Parties are charged nothing to use the Direct Negotiation tool. If they elect mediation, the cost varies depending on the Web business that referred them. For example, an eBay customer who files for mediation is charged $20. These are just a handful of the growing number of ODR providers. To find others, see the list of links to ODR providers available at ODR.info. Robert J. Ambrogi is author of the revised and expanded second edition of "The Essential Guide to the Best (and Worst) Legal Sites on the Web," now available at www.lawcatalog.com. He can be reached at rambrogi@legaline.com. This article was originally published in Law Technology News, a Recorder affiliate based in New York City.