Overcoming the pathology of litigation: An ADR primer for executives

Abstract

T he chief executive officer of a rnultinational company looked anxiously and pessimistically across a long oak conference table at the plaintiff and her counsel. In the lawyer’s mind the facts were clear. His client was sexually harassed, the liability was unquestionable, and the damage amounted to a grave injustice. The CEO, along with the chief legal counsel, listened intently to what was said and thoughtfully considered the claims and projected damages as he contemplated a response. With the prospect of a mega-dollar judgment hanging over their heads, they sat uneasily at the table. As the plaintiffs counsel continued the frontal assault, he briefly explained options the corporation might consider as dispute resolution processes, including mediation and arbitration. Encouraged by the ability to resolve the conflict in a private forum, the company officials listened intently to the proposal. They were definitely struck by the possibility of minimizing loss and saving face during a potentially gut-wrenching situation. With this in mind, the CEO made clear his interest in exploring this more compatible, less combative, and more comfortable approach to resolving the problem before them. The plaintiffs counsel smiled and said, “I’m glad we’re in agreement. Let’s move to an equitable win-win resolution.” This scenario is both hypothetical and illustrative. Every day in this country, vendors, employees, and customers decide whether their anger and sense of injustice warrants further action They must decide whether to raise the stakes of their disagreement through litigation. The scenario also suggests, however, that litigation is not the only alternative available. Alternative Dispute Resolution (ADR) is an option many are considering. This article presents a primer on ADR for executives who may one day need it but have yet to study its importance. dynamics, and implications.