Northshore High Tech: Alternative dispute resolution
by Gordon Mitchell, Ph.D.
A small high tech company--or even a large company--can be ruined by lawsuits. In addition to possible financial judgements, the severe losses typically include huge legal fees, lost executive time, and a bad public image.
There is an alternative. It can immunize a business relationship from the agony of lawsuits. It is not complicated to set up and has a long history of support in the laws of all states.
The alternative is, in fact, called alternative dispute resolution. For business relationships, it can be activated by putting a simple paragraph in business agreements, stating that the parties signing the agreement will use mediation or arbitration to settle disagreements.
Sheri Raders, the regional vice president of American Arbitration Association says, "Alternative dispute resolution is an important tool to prevent ruining ongoing business relationships."
Her non-profit organization is the leading provider of mediation and arbitration in the U.S. It provides helpful material at no charge and can be contacted at 343-5679.
Mediation is a process that allows both parties to solve their problem privately, keeping trade secrets from becoming public knowledge. It is managed by a mediator who is knowledgeable in the technology or business matter in dispute. The parties themselves put an agreement together. With skilled mediators, agreements are found in about 85 percent of cases. Many times, mediation can be completed without assistance of an attorney.
The special advantage of mediation is that it provides a path to further cooperation between the parties. This is especially important between companies in an industry such as software development, where being either a lawsuit loser or winner can characterize a company as an undesirable.
Arbitration is a more formal process that uses one or three arbitrators to hear each party's concerns and decide the dispute. Arbitration hearings focus on making sure that both sides get the opportunity to tell their story. Since arbitrators are appointed for their expertise, they are more likely to understand technical details than a judge or jury. Arbitration has been used for years in the construction industry, where timely decisions are needed during construction projects.
One interesting aspect of arbitration is that in virtually all cases, it cannot be appealed or overturned. This means that even in complex cases, a prompt answer is available and extended court procedures are avoided.
Gordon Mitchell has a background in the engineering management of high tech organizations. He is a principal of Future Focus, a Woodinville company that provides an unusual investigative service, working with commercial clients who suspect they may be victims of electronic eavesdropping. Future Focus performs specialized inspections to locate bugs and taps that may have been installed by unethical competitors or dissatisfied employees. Gordon can be contacted at 489-0446 or via e-mail at gordonm@Bug-Killer.com.