Dispute Resolution Process Assignment | Online Assignment

CASE STUDY 2: Alternative Dispute Resolution
Below you will find three different cases with different topics. You need to read them and consider what kind of dispute resolution process you would recommend for each, from unassisted negotiation at one end of the spectrum to formal trial at the other, with varieties of facilitation, mediation, mini trials, and arbitration in between.
Bear in mind that some of the cases might suggest that you take the point of view of a particular party. Others will describe the situation more generally. Even if you are asked to identify with a specific party, your analysis should take into account the willingness of other parties to participate in your proposed course of action.
Also, you should consider how people’s roles in an organization might influence their recommendations. Look for situations where managers and their lawyers might not see eye to eye, for example.
Therefore, before writing down your final response, take into account the following:
• What would have to be different about a given case to alter your recommendation, that is, what are the key variables that could tip your view one way or the other?
• Assuming that the parties in each case are under no contractual or legal obligation to engage in a particular ADR process, who might most effectively persuade the others to agree to your recommended form of ADR? How should they go about selecting a nonpartisan third party, and how should the costs of the process be allocated?
• What is gained or lost (if anything) if a particular ADR process is required by law or contract rather than negotiated, after a dispute arises?
• Maximum of 400 words for all three answers.
• Your answer needs to be submitted via Turnitin. Any other kind of submission will not be accepted. Date for submission will be posted on the Turnitin assignment, in Moodle.
A) Damages & liability
You are a top-level insurance company executive, responsible for handling a case that has been entangled in expensive and unfriendly litigation for several years over alleged defects in train wagons designed by your insured to carry larger quantities of coal than was viable with conventional train wagons. As the insurer, you have covered defense costs and will need to decide whether to settle the case—and if so, for how much.
A utility company purchased large numbers of your insured’s wagons to haul coal over tracks in the northeastern of Germany. Extensive cracking developed in these wagons that has required expensive, ongoing repairs. The utility company has claimed approximately €30 million in damages, including €4 million in attorneys’ fees expended in this and related litigation. Based one specific sectorial law that might apply, it could allow for recovery of reasonable attorneys’ fees. In addition, the utility company alleges that it would be entitled to treble damages (up to €90 million) if it establishes unfair trading practices under federal law that may or may not be applicable.
Defending against the claim for defective design, you have sued the manufacturer of the train wagons, alleging that its negligent manufacturing standards rather than your insured’s design led to the problem. You have also filed a counter claim against the utility company, alleging that its failure to maintain its track has created or exacerbated the cracking problem.
BUSINESS LAW
CASE STUDY 2: ADR
Professor: Dr. Begoña G. Otero
Case Study 2 is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
You have participated in negotiations on the case, and you have gone through an unsuccessful mediation effort. During the process, the mediator provided an evaluation of the case, supported by a document outlining a neutral risk analysis. A gap of approximately €2 million remains.
While you would have offered close to the number suggested by the mediator, you would not go the entire way. You remain fundamentally skeptical of the damages numbers offered by the plaintiff utility company.
These seem inflated, unrealistic, and largely unprovable to you. You also were informed that the plaintiff (which had previously settled with the manufacturer for an assignment of his claims) would not come down as far as the mediator recommended. A great deal of time and effort went into preparation for the mediation. It is estimated that the drafting of legal briefs on the extensive and complex legal issues in the case will cost at least €150,000. If the case goes to trial, it will take six weeks and easily cost an additional €350,000. The case will be heavily dominated by expert testimony as well as many witnesses.
Should you consider some form of ADR before proceeding to trial? If so, which form, and why?
B) Local Regulation
You are the vice president of a major national newspaper, launched 50 years ago in Munich, now expanding to other areas of the country.
The installation of large numbers of news racks on sidewalks throughout cities and towns is a major part of your distribution plan. Under the direction of your general counsel, a coordinated effort was made to quell opposition to the news racks. As a first step, you produced a letter to each town or city clerk, requesting copies of by-laws or ordinances that would affect the right to distribute newspapers though news racks on the town or city sidewalks. Few clerks responded. To those who did, a letter was sent indicating that the by-law or ordinance would be unconstitutional if applied to news racks. A letter was then sent to all cities and towns, indicating the approximate date on which the news racks would be installed. In the first wave of “Operation Installation,” your crews placed many hundreds of news racks on city and town sidewalks in Hamburg and the towns immediately northeast.
As you could have anticipated, there was quite a commotion in the local press the next day. One small town held an emergency selectman’s meeting and passed a resolution banning the news racks and ordering the public works department to take them out. Within 15 minutes, the public works department trucks were on the street and crews were yanking out the dozen or so news racks in the town, throwing them into a police salvage area.
Upon hearing of the town’s action, your general counsel authorized your company’s local counsel in the area to file suit in court, seeking a preliminary injunction that would require reinstallation of the news racks. Somehow, the court clerk’s office reached you by telephone, and asked if you would be willing to participate in the court’s ADR program for newly filed cases. He indicated that the town was willing to participate.
What is your response? Is ADR appropriate here? If so, what process would you use, and why?
C) Cybersquatting
You are a board member of the international non-for-profit humanitarian organization SatelLife. SatelLife is an initiative of the International Physicians for the Prevention of Nuclear War, recipient
BUSINESS LAW
CASE STUDY 2: ADR
Professor: Dr. Begoña G. Otero
Case Study 2 is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
of the 1985 Nobel Peace Prize, and has been using the domain name HealthNet.org since 2003. The organization provides health and medical information to the developing world through a complex electronic network that serves people who don’t have access to the Internet. Its partner sites are referred to as HealthNets – thus the reason for the domain name. According to SatelLife, its service provides a lifeline to doctors in rural locations overseas. You have invested over two decades in building your reputation as an unbiased source of health information and feel that this reputation is tied to the “healthnet” name. For example, in the annual report the UN refers to the organization as HealthNet not SatelLife. The organization also issues a weekly publication called “HealthNetNews”.
SatelLife was recently contacted by a large American Health Maintenance Organization (HMO) named Health Net, which claims to have registered the name “Health Net” as a trademark in 1981. The HMO sent SatelLife a cease-and-desist letter, demanding that you stop using the HealthNet.org domain name immediately. Days before the name was to be put on hold, under the guidance of your legal team, your organization, SatelLife, filed an action in court, seeking to preserve its right to the domain name. Health Networks claims that if SatelLife had done a trademark search when it first started using the name HealthNet for its e-mail network, SatelLife would have discovered that the name had already been registered as a trademark by the HMO in 1981. A domain name search in 2003, however, when SatelLife registered its name would not have brought up “Healthnet.com” [Note the difference from “Healthnet.org”] since Health Networks did not register the former name until 2005.
According to a spokesperson at SatelLife, “[f]or a financially challenged non-profit to be compelled to change its identification is a possible death sentence. In any case it will foster confusion and may deny health professionals in the most impoverished countries of the world vital information they have come to depend on. We work in an entirely different domain than the HMO; we neither interfere with the clientele of the Healthnet HMO in California, nor dilute their message or affect their identity.”
They anticipate that changing their domain name could cost approximately €1.5 million in addition to the intangible costs attributable to the confusion it would cause those who rely on their system.
Should you consider some form of ADR before proceeding to trial? If so, which form, and why?