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Arbitration News
Arbitration News
October 2014

10/30
  • Arbitrators Finally 'Get' E-discovery

    For years, many proponents of arbitration have considered the cost and delays of discovery of electronically stored information (ESI) inconsistent with core principles of arbitration such as efficiency and cost-effectiveness. That view led many arbitral bodies and arbitrators to step only cautiously and slowly into the e-discovery realm. They were unsure of how to implement it until new rules were issued.  Domestic arbitral bodies, beset with criticisms of arbitration generally, have made and continue to make changes with regard to ESI. Both JAMS and the American Arbitration Association (AAA) now have protocols for e-discovery, as do several of the international arbitration providers. read



10/27
  • Fighting Your Broker in Arbitration? Finra 'Judges' Give Some Tips

    You may think you have an open-and-shut case against a stockbroker who's a 10 on the sleaze scale. But the arbitrators who hear cases against Wall Street's rogues say even investors with good cases can lose when they're not prepared for their hearings. A panel of four arbitrators spoke Thursday at the annual meeting of the Public Investors Arbitration Bar Association, a group of lawyers who represent investors who've been fleeced. They shared ideas about what works and what doesn't when investors look to be made whole after investment losses. Every investor has to agree to use arbitration run by the Financial Industry Regulatory Authority, rather than court, before he or she can open a brokerage account, so it's worth knowing what arbitrators want, and what turns them off. read



10/13
  • Getting a fair shake in arbitration

    The Public Investors Arbitration Bar Association has made one valid point in its criticism of the pool of arbitrators used by Finra to settle suits by investors against brokers, but it also makes a number of unjustified assumptions about members of the pool. In a study it released last week, PIABA implied that investors cannot get a fair shake from the Financial Industry Regulatory Authority Inc.'s arbitrators because 80% of the roster is male, the average age is 67 and 73% have advanced degrees. It noted that “PIABA's research shows Finra's arbitrator pool consists primarily of elderly men who have socioeconomic status that puts them out of touch with the average investor.” It also reported that the “win rate” for claimants dropped from about 60% in the early 1990s to 42% in 2013. read



10/07
  • The Promise and Perils of “Med-Arb”

    When disputing parties tire of mediation (because it is too “weak”) or fear arbitration (because it is too “controlling”), they seek an Alternative Dispute Resolution solution that is “just right.” Recently, I’ve heard a number of highly talented negotiators, and one famous law school, endorse med-arb as the best of all ADR worlds. The advantages, however, come with caveats. read



10/06
  • SEC to take deeper look at Wall St. arbitration reform plan

    The U.S. Securities and Exchange Commission is taking the unusual step of extending its review of a plan to restrict industry veterans from serving as arbitrators in many legal disputes between investors and brokerages, citing questions about whether the proposal complies with securities laws. The plan to revamp how arbitrators are selected was filed by the Financial Industry Regulatory Authority (FINRA) in June and must be approved by the SEC before it becomes a final rule. The plan "raises questions" about whether it is in line with laws that require FINRA rules to protect investors, among other things, the SEC said in a notice published on Wednesday seeking additional input from the public. read



10/02
  • EnergyBuzz: Arbitration for Energy Disputes

    It's almost 2015; do you know where your arbitration clause is? In the past year, the International Centre for Dispute Resolution, the American Arbitration Association and other arbitration forums substantially revised their rules to streamline the process, limit discovery, expressly allowing for dispositive motions and make arbitration more efficient and economical. Although arbitration itself is not new to the energy sector, the proliferation of shale plays due to horizontal drilling and hydraulic fracing, coupled with an increase in political and economic volatility, has spawned a surge in complex energy disputes that often cross jurisdictional boundaries. read



September 2014

9/30
  • Reimagining Arbitration

    The rapid growth of commercial arbitration has not been without drawbacks. As counsel have become more sophisticated in dispute process design, arbitrations now often incorporate many elements of a court trial. The inevitable consequence of these changes has been increased expense and delay. To preserve the benefits of arbitration, it is necessary to address this issue from several perspectives, starting with the arbitration clause. A thoughtful process usually should include a negotiation or mediation step, reasonable limits on the scope of discovery, overall time limits on the arbitration, and the designation of one rather than three arbitrators whenever possible. read



9/24
  • Arbitration Clauses Must Be Explicit About Waiver of Suit

    An arbitration clause in a consumer contract is not enforceable unless it clearly indicates that the plaintiff is giving up the right to go to court, a unanimous New Jersey Supreme Court ruled Sept. 23. Arbitration is favored under both federal and state law but that favored status “does not mean that every arbitration clause, however phrased, will be enforceable,” Justice Barry Albin wrote in Atalese v. U.S. Legal Services Group. “By its very nature, arbitration involves a waiver of a party’s right to have her claims and defenses litigated in court,” Albin acknowledged. “But an average member of the public may not know—without some explanatory comment—that arbitration is a substitute for the right to have one’s claim adjudicated in a court of law.” read



9/23
  • Law enforcement finds arbitration imperfect

    The state’s grievance arbitration system was designed to protect public employees from discipline without just cause and violations of their employment contracts. Yet some arbitrator decisions reinstating police officers terminated for criminal activity or alleged criminal activity have called into question whether the arbitration system serves the interest of public trust in law enforcement. Some law enforcement leaders say they can’t depend on arbitrators to uphold discipline of peace officers who violate the law. read



9/09
  • Gazprom Seeks Mediation of Moncrief's $1.36 Billion Suit

    Russia’s biggest company Gazpron asked a U.S. judge to force Moncrief Oil International Inc. to arbitrate a $1.36 billion trade-secrets lawsuit and dismiss the case.  Moncrief’s claims are linked to negotiations with Gazprom over a stake in a Russian oil field and are subject to an arbitration clause of the companies’ 1998 contract.  A previous lawsuit filed by Moncrief in 2006 alleging breach of contract was dismissed after Gazprom argued the dispute required mediation. While the new case accuses Gazprom of stealing Moncrief’s secret market research -- revealed during the negotiations -- the claim still relates to the contract and still requires mediation, Gazprom argues.  “For nearly a decade, Moncrief Oil International Inc. has tried to do the impossible -- prevail on claims against OAO Gazprom and various subsidiaries based on an alleged cooperation agreement while simultaneously avoiding that agreement’s binding arbitration clause,” Gazprom said in the filing. read



9/08
  • Inside counsel should consider revisiting arbitration clauses

    In light of recent landmark rulings, inside counsel should keep a close pulse on the emerging consumer-friendly trends of the state courts and consider revisiting the standard arbitration clauses, which for years have been used as contractual protective shields for Corporate America. read



9/03
  • What Your Financial Advisor’s Mandatory Arbitration Clause Means for You

    There’s nothing arbitrary about mandatory arbitration clauses, but you can be purposeful in how you scrutinize them. The fine print you read before you sign can save you headaches and expenses down the road. Such clauses are in the fine print of virtually every contract you read from securities brokers. They’re also nonnegotiable. You might be able to change other parts of the contract, but if you try to strike out the arbitration clause to preserve your right to bring a complaint through the court system, the advisor will likely tear up the contract.  read



August 2014

8/17
  • White House Order May Reignite Employment Arbitration Debate

    A White House executive order restricting mandatory arbitration clauses for employees of large federal government contractors is ripe for a challenge, according to some attorneys.  Labor and employment lawyers said they expect the order's direct impact will be limited, but its effect on the public discourse regarding arbitration of employment disputes could be significant. President Barack Obama's order may conflict with the Federal Arbitration Act, some attorneys said, and a legal challenge is possible. Plaintiffs attorneys may cite the order as ammunition to attempt to discredit arbitration clauses by other employers. The Fair Pay and Safe Workplaces Executive Order, signed July 31, says companies with federal contracts of $1 million or more may not require employees to enter into pre-dispute arbitration agreements for disputes arising out of Title VII of the Civil Rights Act or from torts related to sexual assault or harassment. read



8/16
  • Global cotton body to speed up dispute settlement process

    The International Cotton Association Limited is in the process of working out a new non-binding mediation process to expedite the disputes and ensure sanctity of contracts, its President Mohit D Shah said here on Tuesday. “There is a possibility to introduce a non-binding mediation, whereby buyers and sellers will be able to sit and discuss to resolve the issue. Some sort of announcement can be expected soon,” he said, on the sidelines of a cotton conference organised by the Indian Cotton Federation in Coimbatore. ICAL’s annual conference is slated at Dubai in the first week of October, and Shah is hopeful of making some announcement on the new mediation process during or just ahead of the conference. read



8/13
  • Making the Case for Arbitration

    Is litigation “better” than arbitration? What does “better” mean, and who decides? The debate over arbitration vs. litigation has been going on for years, and will likely continue . . . with no clear winner. Aaron Foldenauer essentially invited this discussion in his July 29 article on CorpCounsel.com, “Big Risks and Disadvantages of Arbitration vs. Litigation.” While my article responds to some of the criticisms of arbitration in that one, I hope that it is a thoughtful counterpoint. I speak from the standpoint of one who, for over 40 years, has counseled businesses and their owners, tried their cases in both court (jury and nonjury) and arbitration, and served as neutral arbitrator, either as sole arbitrator or as a member of chair of a multiarbitrator panel, in hundreds of commercial cases. read



8/11
  • Obama strikes a blow against the scourge of forced arbitration

    Little noticed in coverage of President Obama's signing of the Fair Play and Safe Workplaces executive order July 31 was a provision that has been called "one of the most important positive steps for civil rights in the last 20 years."  The statement comes from Paul Bland of the public interest group Public Justice, quoted by Emily Bazelon of Slate. He's right; what he's referring to is a provision of the order that bars employers from forcing workers to bring workplace discrimination, sexual assault or sexual harassment cases only through arbitration. As Bazelon reports, the order applies to firms with federal contracts valued at more than $1 million. But that's plenty. read



  • Taking a Broker to Arbitration

    If you have a problem with your investment broker and you cannot resolve the dispute on your own, you probably won’t get your day in court. But you will be heard, most likely in a conference room somewhere, before a panel of arbitrators. The moment people open a brokerage or investment account, they most likely — and perhaps inadvertently — waive their right to sue. The fine print of most customer agreements almost always contains a clause that says the customer agree to resolve any future disputes through arbitration, largely through the forum operated by the Financial Industry Regulatory Authority, Wall Street’s self-regulatory organization, known as Finra. read



July 2014

7/29
  • Big Risks and Disadvantages of Arbitration vs. Litigation

    Three recent high-profile arbitral awards highlight the risks of arbitration and demonstrate that, contrary to widespread belief, arbitration is often not cheaper, faster or more predictable than litigation. These three awards, as well as emerging trends in arbitral proceedings, call into question the common practice among corporations of including contractual provisions mandating arbitration in the event of any disputes. read



7/28
  • UK It's time to get serious about arbitration

    It’s time to face the facts. The UK coalition government’s obsession with mediation has failed. It is now time to get serious about an alternative which has been overlooked for too long: arbitration. The family courts are overcrowded. A huge number of people seeking a divorce, or the right to see their children have put a significant strain on the system. The government’s solution? Get more people to choose mediation. In an attempt to prove its effectiveness, the government’s action on the issue has proved the opposite: mediation is not the answer. read



7/22
  • Privatization of justice & "Sharia courts" 

    The apex court in its landmark decision on 7th July, 2014 held that sharia courts are not courts as Indian legal does not recognize a parallel judicial system. But then is it not a fact that privatization of justice is fact of life not only in India but in most developed countries? Does our law not recognize arbitration and other alternative methods of dispute resolution? Are not sharia courts and fatwas different and therefore should not be clubbed together? What has been the performance of sharia courts in last 94 years? Has not the latest decision given new lease of life to the sharia courts? read



7/13
  • Is Your Arbitration Clause Outmoded?

    Although arbitration is a “creature of contract” and many arbitrations proceed in the manner outlined in the arbitration clause, it is not unusual for the parties and their counsel to alter the terms of the original clause to suit the dispute at hand. Often a dispute has arisen years after the arbitration clause was drafted, and circumstances have changed. The clause may no longer be appropriate. Although the parties and their lawyers may have strong disagreements on the merits of the case, they understand that stipulating to a customized process that suits the dispute is a huge benefit to everyone involved. This flexibility is one of the strong points of the arbitration process. The following suggestions are just a few of the ways to alter an outmoded clause: read



7/10
  • 'Big Short' Case Raises Questions About Finra Arbitration

    Deeb Salem, the former Goldman Sachs trader who helped devise the firm’s brilliant and highly profitable proprietary bet against the mortgage market, has never been shy about trumpeting his accomplishments. Mr. Salem no longer works at Goldman — he decamped to GoldenTree Asset Management, a New York hedge fund, in 2012 — but his continuing lawsuit, which contends the firm shortchanged him about $21 million in bonus and deferred compensation during the years after the financial crisis, raises fresh questions about the fairness of Wall Street’s compensation practices, its willingness to make scapegoats out of former employees and the arbitration system — run by the Financial Industry Regulatory Authority — that everyone who deals with Wall Street is forced to use to resolve monetary disputes. read



7/08
  • How Consumers are Getting Screwed by Court-Enforced Arbitration

    The Supreme Court has given financial institutions and employers a license to do wrong—and it’s hitting the poor especially hard. For more than forty years, the Supreme Court’s conservatives have been engaged in a campaign to shut the courthouse door to consumers, working people, small businesses and others seeking redress for corporate wrongdoing. In recent years, and especially since Chief Justice John Roberts and Associate Justice Samuel Alito joined the Court, a major weapon in this campaign has been the Federal Arbitration Act (FAA) of 1925. The conservatives have used the act to prevent victims of such abuses from seeking redress in the courts, forcing them into pre-dispute arbitration instead. In doing so, they lose a public trial, a jury and a neutral judge, as well as an appeal to a higher court; in many cases they may also have to give up discovery rights. It is not uncommon for them to wind up before an arbitrator who is dependent upon the defendant’s business community for work and fees, and who may not even be legally trained. Not surprisingly, those forced into arbitration almost always fare much worse than they would in court. read



7/02
  • Want to require an arbitration agreement? That’s fine as long as it’s fair to employees

    Here’s some good news for employers that want to use arbitration as a way to resolve employment disputes instead of relying on federal or state courts: Imposing a fair arbitration policy on applicants as a condition of employment is fine. Once the applicant “takes” the take-it-or-leave-it arbitration agreement by accepting the job after having a chance to review it, she’s stuck with it. read



June 2014

6/23
  • ADR may put courts out of (small) business

    In light of the continued fall in court cases and the rising use of ADR, is there a future for our courts in Scotland? Should the decline we have seen over the past four years continue, then by 2020 the Scottish Courts will very much be the minority player in the resolution of disputes in Scotland. There will, of course, always be the need for the courts for certain cases and parties. It does appear, however, that their role will become increasingly specialised and will only deal with the high end, complex disputes involving multi-million sums. read



6/09
  • Bob Buckley: Arbitration favors the deep pockets, not you

    A number of years ago, large corporations discovered that there was a legal way of depriving consumers and employees of their constitutional right to a trial by jury. It is called “alternative dispute resolution,” which is just another way of stating that the little guy is not getting a full measure of justice. How many times do you sign an agreement that provides for arbitration in the event there is a dispute? Many consumer agreements today regarding phone service, cable television service, car sales, or even your employment agreement have arbitration provisions to which you have “agreed.” It's not like you have any negotiating power, because if every service provider dictates it there is no option. read



6/05
  • Your Contract Might Be Useless Without an Arbitration Clause

    You are vulnerable without an arbitration clause in your contracts and it could prove to be devastating. Contracts are relatively useless if you cannot enforce them without too much hassle; enforcing them through litigation may be too costly and time-consuming to be practical. An "arbitration clause" is simply a provision in a contract that requires the parties to resolve disputes through private arbitration rather than litigating them in court. These clauses have become very popular of late since we live in a litigious society where often a breach of contract leads to one of the parties filing a lawsuit. Most people do not realize how costly and time-consuming it typically is to use the courts to enforce contracts. read



  • Big-Business influence: Madonnna, jury trials and mandatory arbitration

    Madonna made news recently when she got a doctor’s note to avoid jury duty. The material girl’s no-show was not meant to be a statement about the often-futile system of civil justice in America, but it might as well have been. The influence of big business on our Supreme Court and elected officials over the years has resulted in a reality that civil “justice” is a joke, particularly for consumers and most employees. Our “right” to go to court has been virtually eliminated and in its place, the process of binding arbitration now resolves most consumer, employment, anti-trust, and civil rights disputes. Arbitration has virtually eliminated an aggrieved person’s right to go to court and seek justice. read



May 2014

5/27
  • Using arbitration agreements to manage arbitration cost and risk

    Arbitration has been under attack as too expensive, too cumbersome, too slow, too arbitrary and incurring too many of the costs of litigation but delivering few of the promised benefits of ADR. Below are strategies — many of which may be employed in the arbitration agreement itself — that may reduce some of the perceived risks and costs. Many of these strategies require corporate counsel to be sensitive to issues perhaps more familiar to arbitration counsel, and to ask clients the necessary questions. read



  • Germany Mulls Arbitration for Web 'Right to Be Forgotten'

    The German government is considering setting up arbitration courts to weigh in on what information people can force Google Inc. and other search-engine providers to remove from results. Following a European Union court decision this month granting consumers the “right to be forgotten,” the Interior Ministry in Berlin would seek to establish “dispute-settlement mechanisms” for consumers who file so-called take-down requests. If search providers introduce automatic deletion, public information would be at risk, the ministry said. “Politicians, prominent figures and other persons who are reported about in public would be able to hide or even delete reports they find unpleasant,” it said in a statement. The ministry suggested that the removal of information shouldn’t be left to company algorithms. read



  • Arbitrator, not court, decides arbitration agreement’s enforceability, California Court rules

    A trial court lacked authority to rule on the enforceability of an arbitration agreement when the parties had contracted to delegate questions about the agreement’s enforceability to the arbitrator, the California Court of Appeal has ruled, reversing the denial of arbitration in a wrongful discharge action. Although the agreement’s delegation provision was in an adhesive contract, drafted by the employer and presented to the employee on a take-it-or-leave-it basis, and despite the fact the employee stated she was worried she would lose her job if she refused to sign it, the Court found the agreement was enforceable because it was not overly harsh or one-sided, and therefore, not substantively unconscionable. read



5/20
  • Mandatory Arbitration Offers Bargain-Basement Justice

    The financial services industry is already forming battle lines in advance of the Consumer Financial Protection Bureau's expected proposal to curtail the use of mandatory arbitration in consumer financial contracts. The industry would like to continue its current widespread practice of eliminating consumer access to courts, including the right to bring class actions. Consumers are instead forced to resolve disputes in individual arbitrations with decision-makers chosen by the financial firms. The debate over binding mandatory arbitration comes down to this: Is it fair for a business to effectively force its consumers into a dispute resolution system that it has selected? read



  • Wondering What The Difference Is Between Mediation and Arbitration?

    Most Americans know what litigation is even though the majority have likely never been involved in a lawsuit, other than perhaps in small claims court. Many have heard of mediation and arbitration and alternative dispute resolution, but few likely know exactly what they are and how they differ. I will explain the differences in this article. read



5/05
  • Arbitration Is Fair and Efficient for Consumers

    The Consumer Financial Protection Bureau has released phase one of its study on the use of mandatory arbitration clauses in connection with consumer financial products and services. Among the study's preliminary findings, the CFPB determined that larger institutions are more likely to use arbitration clauses, arbitration clauses in account agreements can often be complex, and these agreements often contain class-action waivers. The preliminary study, released in December, read alone might also suggest that arbitration clauses could disadvantage consumers. However, because it was only a preliminary look, the report failed to paint a complete picture of the costs and benefits of arbitration. read



April 2014

4/22
  • Finra's Arbitrators: Dubious, Asleep—Sometimes Dead

    When a couple in Wichita claimed they lost $187,500 in what they called a Ponzi scheme orchestrated by a Morgan Stanley (MS) broker, the industry-funded Financial Industry Regulatory Authority (Finra) provided a list of potential arbitrators to resolve the dispute. Two of the people were dead, one for more than two years, according to Diane Nygaard, the couple’s lawyer. She calls the faulty list a sign of a broken system that has failed to protect investors. “If it were a regular judicial system, you would not have a case appointed to people who are dead,” she says. “Wall Street should not have a special pet court that they operate.” read



  • General Mills abandons mandatory arbitration after consumer outcry

    General Mills Inc., maker of Cheerios and other grocery staples, has reversed a recent change to its online legal policy after an outcry by consumers.  The policy had been quietly updated last week to include terms under which any dispute with the company would have to be decided through arbitration, a change first reported by the New York Times last week. Critics and legal experts said the new terms could cost consumers their right to sue in court if they merely "liked" General Mills' social media pages, downloaded coupons from its website or entered any company-sponsored contests. General Mills initially criticized the media reports on the policy, saying they had mischaracterized it. The company also defended arbitration as "a straightforward and efficient way to resolve such disputes — and many companies take the same approach. We even cover the cost of arbitration in most cases." But the coverage set off consumer outcry on social media, eventually leading to the abrupt reversal Saturday. read



4/17
  • State To Expand Court-Sponsored ADR Programs

    The Connecticut Judicial Branch has announced a host of initiatives to improve court-sponsored alternative dispute resolution in order to keep up with the demand to resolve civil cases short of trial.  New initiatives announced by Chief Justice Chase Rogers will include expanding the number of judges who are trained to serve as mediators, to begin later this year. There are currently 60 judge and judge trial referees available for the Judicial Branch's ADR program, but many are not available to serve for lengthy periods of time as mediatiors. Increasing the number of judges who are available to provide mediation services on more than a limited basis to help parties reach a settlement will fill vacancies created by several Superior Court judges who left the bench in recent years to start their own mediation practices in recent years, Rogers said.  Another new initiative is to have attorneys appointed to serve as mediators. Rogers said the attorneys could be hired by the branch on a case by case basis, similar to the current appointments of attorney trial referees. "For example, attorneys with particular expertise in construction law, commercial disputes or probate law could be an invaluable asset in resolving those kinds of cases, where a substantice expertise in a specialized area is essential to understanding the issues of the case," Rogers said. read



4/15
  • Finra gets arbitration process back on track in Puerto Rico

    Finra has expanded its pool of arbitrators and is ready to move forward with the hundreds of complaints related to collapses in Puerto Rico bond funds, according to an announcement posted on its web site Monday. After several months of deliberation, Finra said it will resume processing investor complaints now that it has about 700 arbitrators from Southeastern U.S. and Texas who are willing to fly to Puerto Rico. The Financial Industry Regulatory Authority Inc. has also resolved issues related to the language barrier as UBS AG and Bank of America Merrill Lynch agreed to pay fees for translators. read



4/09
  • Emerging markets need to improve arbitration system

    Dubai: Emerging markets need to upgrade their legal infrastructure, particularly those related to arbitration rules and regulation, experts said at the second day of the Annual Investment Meeting 2014 in Dubai. Louis Wells, Professor of international management at the Harvard Business School, said that despite the remarkable growth emerging markets could achieve in attracting foreign investments, these countries should work harder to improve their arbitration system. Arbitration is a very important instrument for improving the overall investment environment in the emerging markets and governments should do better in this to facilitate and protect these investments, Wells said. read



March 2014

3/03
  • Why You Should Opt Out Of Forced Arbitration, In 3 Sentences

    While more and more companies are adding “forced arbitration” clauses to their terms of service, only a handful of these businesses are offering customers the choice to opt out of this part of the contract. Here are the reasons why you should take advantage of that option whenever possible. read



February 2014

2/20
  • Medical disputes pushed to arbitration

    A new regulation will require public medical institutions to inform patients that they have the option to settle their medical disputes through arbitration if the case involves a claim of more than 30,000 yuan ($4,938). The regulation, which goes into effect next month, is one of several new rules that aim to steer more aggrieved patients to the city's medical arbitration system, rather than letting their complaints pile up at local hospitals, said Li Heping, vice director of the Shanghai Medical Dispute People's Arbitration Office. "There have been a lot of unsolved disputes accumulating at public hospitals. We want to push more of them into medical arbitration by informing more families about the system," Li said. Patients in about 75 percent of medical dispute cases have demanded more than 30,000 yuan in compensation, Li said. The medical arbitration system began in 2006 as a pilot program in several districts, but it received few cases until it was instituted citywide in 2011. Last year, local medical arbitration offices dealt with 3,087 cases and resolved about 80 percent of them. read



2/18
  • Can we talk?

    Thinking of suing that firm that did you wrong as a customer or that vendor for poor quality merchandise? Try mediation or arbitration instead. The two methods are among remedies collectively known as alternative dispute resolution (ADR). Business owners who turn to ADR save time, money and maybe the business relationship that’s in question. “ADR is a cost containment mechanism. Cases move faster and that saves money,” says Bill Nolan, managing partner at Barnes & Thornburg. read



2/14
  • Regulator plans purge of Wall Street arbitrators

    Wall Street veterans would no longer be allowed to act as arbitrators in many legal disputes between investors and their brokerages under a proposal that a U.S. regulator will present to its board on Thursday, a person familiar with the matter said. The plan by the U.S. brokerage industry self-regulator, the Financial Industry Regulatory Authority (FINRA), would mean that investors could opt to have their cases heard by a panel of three so-called public arbitrators who would not include people who had past industry ties. read



2/07
  • Mediation or Arbitration: What’s the Difference?

    When people disagree, they have choices on how to resolve their dispute. They can lawyer-up, file a lawsuit, and let a judge or jury decide who wins. They can also try to resolve the matter between themselves, they can engage in arbitration or they can go through mediation. Mediation is a relatively inexpensive and fast way to resolve disputes. It is a process conducted by a trained and experienced mediator, who may be a retired judge or a practicing or retired attorney. The parties, generally through their attorneys, prepare a mediation statement describing their statement of the dispute, prior settlement efforts, legal authorities of precedential value, and a description and interpretation of documentary support for their position. The statements are often exchanged prior to the mediation. Mediation is a confidential procedure. What is discussed during the mediation and any documents prepared specifically for the mediation remain confidential. If an agreement is reached, it is put into writing and that agreement is not confidential. It is normally embodied in a motion for approval of the settlement and presented to the court in which the case is pending. Sometimes there is no court proceeding, so the parties hold onto the agreement in case enforcement down the road is required. read



2/02
  • Apparel Industry Voices: Mediation or Arbitration: What’s The Difference?

    When people disagree, they have choices on how to resolve their dispute. They can lawyer-up, file a lawsuit, and let a judge or jury decide who wins. They can also try to resolve the matter between themselves, they can engage in arbitration or they can go through mediation. read



  • Arbitrator’s bill in porn-watching teacher case: $48,600

    That’s how much taxpayers in the Middleton-Cross Plains Area School District paid for the services of Karen Mawhinney, the arbitrator who ordered the reinstatement of a seventh-grade science teacher fired for viewing multiple pornographic images and videos at school. The total bill was $48,600, split between the school district and the Middleton Education Association, the teachers union that represented Andrew Harris in what arbitration experts, including Mawhinney, described as an “extraordinary” process. read



January 2014

1/29
  • Clarifying Arbitration vs. Mediation vs. Litigation

    Question: What is the difference between arbitration and mediation?
    Arbitration is a method of finally determining a dispute. The end result is an award which is similar to a Court Order in that it is final and binding upon the parties and can be enforced against the parties in the same way as a judgment of the Court. In an arbitration, a neutral third party – the arbitrator – hears the evidence and makes a decision as to who is right and who is wrong. In a mediation, on the other hand, the neutral third party – the mediator – makes no such determination, but rather focuses on trying to assist the parties to come to a negotiated mutually satisfactory settlement or compromise of the matters in dispute. Sometimes, the mediator is successful, in which case, the dispute is over. Sometimes the mediator is not successful, in which case the dispute continues on. ... read



1/16
  • Ireland: Want To Arbitrate? Be Proactive

    Perhaps the most attractive feature of arbitration is its flexibility. Efficient and cost-effective arbitration is possible if the right questions are addressed up front. For example: Do we need discovery? Do we need to oblige the parties to seek to mediate before moving to arbitration? Do we need a reasoned award? The Irish Courts have repeatedly demonstrated a willingness to uphold arbitration clauses. Recent case law indicates that parties wishing to arbitrate must: (1) ensure that all relevant contracts clearly provide for arbitration, (2) avoid delay and (3) avail of the opportunity to engage fully in the process. read



  • Belgium Strengthens Position On International Arbitration Stage

    Belgium makes headway in its plans to become an attractive forum for domestic and international arbitration. The new Belgian Arbitration Act, based on the UNCITRAL Model Law, has entered into force and CEPANI, the Belgian arbitration institute, has issued new arbitration rules. With the new Belgian Arbitration Act's entry into force, Belgium joins 66 other countries that have arbitration legislation based on the UNCITRAL Model Law on International Commercial Arbitration. By modernising and aligning its Arbitration Act with international arbitration practice, Belgium hopes to establish itself as an attractive forum for international arbitration. read



  • Singapore: Becoming More Attractive For International Arbitration

    With the newly issued SIAC Arbitration Rules, Singapore further strengthens its position as a preferred venue for international arbitration in Asia. The newly issued Arbitration Rules of the Singapore International Arbitration Centre (SIAC) include a number of significant changes affecting the arbitration process. These changes are highlighted below. read



December 2013

12/26
  • Watch Al Franken Shred A Pro-Arbitration Professor For Trying To Gloss Over The Problem

    Earlier this week, the Senate Judiciary Committee held a hearing on mandatory binding arbitration clauses, those fun bits of contractual language that take away your right to sue a company and force you into a resolution process that is heavily weighted in the company’s favor. The hearing was chaired by Senator Al Franken of Minnesota, who earlier this year introduced the proposed Arbitration Fairness Act, and so he obviously has a thing or two to say on the topic. read



12/16
  • Mandatory Arbitration Provisions

    Question: We are in the process of revising our employment agreements and want to put in a mandatory arbitration provision for all employees who have discrimination and wrongful-termination claims. Can you give us some tips on what such a provision should and should not look like in order to make sure it will be enforceable? read



  • Forced Arbitration Is Terrible For Consumers And Right-Wing Media Love It

    A federal agency's new preliminary report debunks the popular right-wing myth that private contracts that require people to take their complaints to an arbitrator are an effective alternative to class-action lawsuits. Right-wing media outlets have consistently supported what are known as "forced-arbitration clauses" -- contractual provisions that often force consumers to give up their right to join a class action lawsuit and instead require them to go before an arbitrator individually, even if the amount in dispute is so small that it wouldn't make sense to pursue outside of a collective, mass action. But according to preliminary findings from a year-long study conducted by the Consumer Financial Protection Bureau (CFPB), forced arbitration clauses actually have the effect of denying consumers of financial products an important avenue for redress in contractual disputes. According to Alison Frankel at Reuters, "the evidence shows arbitration doesn't provide any recovery to the overwhelming majority of consumers of financial products."  read



12/08
  • Appeals Court Sides With Employers on Arbitration

    Employers can require their workers to sign arbitration agreements waiving all rights to class-action lawsuits over workplace grievances, a federal appeals court ruled Tuesday. The ruling from the 5th U.S. Circuit Court of Appeals overturns a National Labor Relations Board decision last year that found such agreements conflicted with federal law giving workers the right to pursue collective action to complain about workplace conditions. The court's ruling is a win for businesses that want to limit legal exposure from the rising cost of class-action lawsuits over unpaid overtime and other wage violations. But it's a blow to workers who find it easier to band together when challenging the policies at a large company. read



  • Investor advocates push to see trove of arbitration records

    A long-running battle over whether the top U.S. securities regulator should release records about its supervision of Wall Street's arbitration process is about to go another round, this time with input from a vocal consumer advocate. For nearly four years, a group of lawyers has been pushing the U.S. Securities and Exchange Commission to release documents about its oversight over how the Financial Industry Regulatory Authority selects arbitrators who hear legal disputes between brokerages and investors. FINRA, the Wall Street industry-funded watchdog, runs the arbitration forum where investors and brokerages must resolve their legal disputes. The Public Investors Arbitration Bar Association (PIABA), a lawyers' group pushing for the release, has now enlisted lawyers of its own. The litigation arm of Public Citizen, a consumer rights group in Washington, filed a brief on PIABA's behalf in a federal appeals court last week to overturn a U.S. district court's earlier decision to keep the records a secret. read



  • FINRA Arbitrators to Get Pay Raise

    Arbitrators in disputes between investors and brokers will get more pay for their work, the brokerage industry's self-regulator decided Thursday, people familiar with the matter said. Lawyers and arbitrators hope the pay rise, the first in 14 years, will attract more--and more skilled--arbitrators. The Financial Industry Regulatory Authority Inc., which oversees the arbitration process, approved an increase in compensation for hearing arbitrators. Finra's board agreed to raise pay by 50%, to $300 for half-day dispute hearings and $600 for full-day sessions, according to people familiar with the matter. The chairperson of an arbitration panel is to receive an extra $125, an increase of 67%, these people said. The pay increases are "long overdue," Philip Aidikoff of Aidikoff, Uhl & Bakhtiari, a Beverly Hills, Calif., law firm that represents mainly investors who seek compensation from brokers for investment losses. "It's an acknowledgment that the arbitrators, for the most part, do a very good job and take it very seriously." read



November 2013

11/18
  • Arbitration center for Israeli-Palestinian business disputes launches

    Jerusalem Arbitration Center aims to boost Israeli-Palestinian economic ties with agreed upon commercial dispute mechanism.  Until now, commercial disputes between Israelis and Palestinians were relegated to inefficient Oslo Accord-era mechanisms. Israeli businesses could not be sure that court decisions would be enforced in Palestinian areas, while Palestinians felt disadvantaged by Israeli law, especially when up against larger, more powerful businesses. With Palestinian courts generally hostile to Israelis, they made a poor alternative.  “There was no arrangement, and most of the deals were done in cash money,” said Shachor.  Because of the lacking legal mechanisms, businesses relied on cash on delivery and bank guarantees.  The new system will allow people to take their disputes to binding arbitration, and is expected to open the doors to other kinds of contracts, credit and business arrangements. read



11/17
  • ConstructionWeekOnline: The Peacekeepers

    Alternative Dispute Resolution (ADR) is fast becoming a widely-accepted alternative to local court litigation. This is particularly true of arbitration. Oddly, mediation is still heavily underused, which begs the question whether there is room for wider subscription in the UAE? In cultures where contracts are not always regarded as rigorous terms of engagement but rather as a framework intended to govern a commercial relationship, mediation is particularly well-placed to serve the settlement of differences at arm’s length before they escalate. read



11/12 October 2013

10/28
  • Lagos Court of Arbitration (LCA) begins radio program ‘City Legal’

    In line with promoting awareness for Alternative Dispute Resolution (ADR) in Nigeria, the Lagos Court of Arbitration (LCA) has embarked on a radio programme, ‘City Legal’, which runs on Tuesdays by 10:00am and Thursdays by 05:30pm, on Smooth FM 98.1. The 15-minutes programme targeted as Large Corporations, Small and Medium Scale Business Owners, International Organisations, Consumers, among others, is created to enlighten and empower the public on ADR and the LCA’s role in bringing mediation and arbitration to the fore-front in dispute resolution. read



  • Pakistan: Mediation framework for investors stressed

    Institutional framework for mediation should be further strengthened in Pakistan through legislative action as is being done in many countries around the world. Local and foreign investors should also include mediation clause in contracts as it provides an efficient and low-cost mechanism for dispute resolution, said Lahore Chamber of Commerce and Industry President Engineer Sohail Lashari at the certificate distribution ceremony arranged by International Finance Corporation (IFC) here on Saturday. read



10/21
  • Appeals court rejects secret Delaware arbitration

    Ruling blocks private arbitrations overseen by sitting judge. A federal appeals court has upheld a ruling declaring that a Delaware law allowing chancery judges to oversee secret arbitration in high-stakes business disputes is unconstitutional. A three-judge panel of the Third U.S. Circuit Court of Appeals ruled 2-to-1 Wednesday to uphold a federal judge's ruling in favor of the Delaware Coalition for Open Government, which challenged the law. DelCOG, backed by The Associated Press, The New York Times and several other major news organizations, claimed in its lawsuit that the secret arbitration conducted by Delaware's Chancery Court violated the First Amendment rights of citizens to attend judicial proceedings and access court records. Attorneys for the state argued that secret arbitration made the Chancery Court more efficient and generated revenue for Delaware, corporate home to thousands of companies. read



  • Moscow Ignores Arbitration Over Greenpeace Ship

    Russia says it will not participate in an international arbitration process over a Dutch-flagged Greenpeace ship, the "Arctic Sunrise," which was seized by Moscow along with the 30 people onboard. The Russian Foreign Ministry said in a statement on October 23 that it will not take part in the arbitration because it had opted out of dispute settlements under the United Nations Convention on the Law of the Sea. read



  • Wyoming lawmakers consider arbitration for tow truck disputes

    Members of a state legislative committee are awaiting a draft bill that would establish an arbitration system for Wyomingites who think they got ripped off by tow truck companies.  After rejecting the bill capping tow rates, the committee ordered legislative staff to draft a bill that would provide customers the opportunity to mediate or arbitrate with a towing company, Landen said. It will be reviewed at the committee’s November meeting in Casper. Mullen, the tow company owner, is open to the idea. “That’s fine by me,” he said. “I justify everything I do. Arbitration will be fine if they keep that fair.” read



10/01 September 2013

9/30
  • The Netherlands updates its Arbitration Act

    In April 2013 the Dutch government published a bill for the 'modernisation of Netherlands arbitration law'. Among other things, the bill aims to ensure the continued appeal of the Netherlands Arbitration Act (1986) to international users. Some of the changes that are proposed in the bill are discussed. read



  • Innovative changes for Belgium’s arbitration rules

    This year Belgium has already seen significant reforms in its arbitration rules. These innovative changes include the adoption of a new Arbitration Act and the adoption of new Arbitration and Mediation Rules by the Belgian Centre of Arbitration and Mediation (CEPANI). read



  • Alex Rodriguez's Arbitration Hearing Set to Begin

    Alex Rodriguez gets to start arguing his case Monday. The Yankees slugger is appeal a 211-game suspension for his alleged involvement in the Biogenesis clinic. In a hearing room before arbitrator Fredric Horowitz, lawyers for the Yankees third baseman will argue why the 211-game suspension imposed by the MLB Aug. 5 should be overturned. read


9/26
  • NJ Appellate Division Says That Mediator Cannot Then Serve As Arbitrator

    From the court: "We conclude the positions of arbitrator and mediator are in conflict. An arbitrator must "maintain 'broad public confidence in the integrity and fairness of the [arbitration] process . . . If the same person acts as a mediator, obtains party confidences or offers opinions on the issues in dispute, a conflict arises were he or she to then switch roles to act as an arbitrator, making the final call. read



9/23
  • Rinehart Allowed Mediation After Arbitration Bid Rejected

    Gina Rinehart, after failing to persuade an Australian judge to have a family dispute over a multibillion-dollar trust resolved by an arbitrator, won her bid for a final mediation attempt. Supreme Court Justice Patricia Bergin in Sydney today dismissed Rinehart’s bid to stop the trial and refer the dispute to arbitration. Bergin granted Rinehart’s request for mediation, to be held before Sept. 26, and if the dispute isn’t resolved the judge scheduled a five-day trial to start Oct. 8, a week later than originally planned. read



9/16
  • Arbitration case launched against New Doha International Airport

    Lindner Depa Interiors (LDI) has filed a circa AED 900 million ($250 million) international arbitration claim against the New Doha International Airport (NDIA). Linder Depa is a joint venture company between Dubai-based interior contractor Depa Limited and Germany’s Lindner AG. The arbitration proceeding has been commenced in the International Court of Arbitration of the International Chamber of Commerce, Paris, France.  read



  • Citigroup must pay couple $3.1 million for not overseeing broker: panel

    A Citigroup unit must pay $3.1 million to a Florida-based couple who alleged the firm did not properly supervise a broker who steered them to invest in a politician's real estate developments that later went broke, a securities arbitration panel has ruled. read



9/06
  • Increasing Enforceability Of Mandatory Arbitration Clauses In Wills And Trusts

    A hot issue percolating among the states is whether a clause in a will or trust requiring alternative dispute resolution — usually arbitration — should be enforced by the courts. While initially courts appeared to frown on such provisions, the trend has shifted recently, particularly with a ruling by the Texas Supreme Court upholding such a clause. read



  • Looming decision on arbitration helps settle concussion cases

    There’s much to digest about the $765 million settlement of the concussion lawsuits filed against the NFL, and plenty of questions to be answered. For now, the most important point is that the looming ruling on whether all or most of the claims would be steered toward the arbitration process helped the two sides come together and work out their own resolution. read



9/05
  • Schwab Case Casts Spotlight on Securities Arbitration and Its Flaws

    Class-action lawsuits are the bane of most financial firms, and many recoil at the prospect of paying out millions to groups of clients if investments go sour. Now, the discount brokerage firm Charles Schwab & Company finds itself at odds with regulators as it seeks to eliminate the option of such suits for its clients. read



August 2013

8/27
  • Growth in Global Disputes Brings Big Paychecks for Law Firms

    King & Spalding is handling arbitration in the legal feud between Chevron and Ecuador over environmental damage in the Amazon.
    Debt woes, broken contracts and soured business deals may cost global investors billions in losses and create seemingly never-ending headaches for policy makers. But there is a set of specialists profiting from such geopolitical problems: arbitration lawyers. About a dozen legal heavyweights are benefiting from the growing number of lucrative, complex international disputes. About 120 such actions worth more than $1 billion each are pending at international arbitration tribunals worldwide, according to a recent tally by American Lawyer magazine. read



8/26
  • With arbitration looming, what exactly is A-Rod's best defense?

    Now that Alex Rodriguez has placed a muzzle on his bulldog lawyer Joe Tacopina – though to be honest, Matt Lauer did a pretty good job of sending him whimpering to the kennel – perhaps we can get past the red herrings and histrionics and focus on the issue at hand.  How will A-Rod’s lawyers defend him where it matters, inside an arbitration hearing room? read



8/25
  • Arbitration Clauses That Avoid Arbitrability Disputes

    It is very common to draft an arbitration clause to apply only to certain types of disputes—but usually a mistake to do so. If the parties want arbitration for certain issues, they would be well advised to consider arbitration for all of them. read



8/22
  • A Brief History of MLB Drug-Suspension Arbitration (or: Don't Worry, A-Rod)

    Arbitrators have a tradition of overturning Major League Baseball commissioners' decisions regarding penalties for illegal drug use. read



8/21
  • Ireland: Guide To International Arbitration 2013

    Article by Nicola Dunleavy and Gearóid Carey read



8/20
  • NFL has agreed to outside arbitration for positive HGH tests

    The NFL and NFLPA haven’t reached final agreement on every issue regarding HGH testing. But the two sides have struck a deal on plenty of the pending points of contention. Per a league source, the areas of agreement include the use of third-party arbitration for positive HGH tests. Contrary to plenty of headlines and sound bites, the NFL has agreed to allow someone other than Commissioner Roger Goodell to make the final determination regarding whether a player has tested positive. read



8/19
  • The next frontier of arbitration litigation: lessons from state courts

    After reading more than 40 decisions about arbitration from state high courts, issued just in the past eight months, I have two bits of wisdom to share. First, that is not the best way to spend your summer vacation, even for a devoted arbitration nerd. And second, there are arbitration issues percolating in state courts that counsel practicing in this area should be aware of. In particular, state courts are: 1) working hard to avoid having the FAA preempt their developed defenses to arbitration clauses; and 2) confronting a lot of issues relating to whether there is an agreement to arbitrate at all (especially authority issues in nursing home settings). read



8/16
  • The International Comparative Legal Guide to International Arbitration 2013

    Chapter on USA by Peter J. Kalis & Roberta D. Anderson read



8/14
  • U.S. Supreme Court Rulings In Arbitration And Employment Matters

    The US Supreme Court continued its trend of business-friendly decision-making in the 2012-2013 term. In particular, the Court’s decisions on arbitration and employment-related issues gave companies and employers victories, enforcing arbitration agreements and limiting the scope of harassment and retaliation claims under Title VII. This article discusses four such decisions. The first two decisions concern the Court’s continued affirmance of the federal policy favoring enforcement of arbitration agreements. These decisions reflect the Court’s willingness to (1) enforce agreements containing dispute resolution methods even if those methods bar class actions and (2) defer to the arbitrator’s interpretation of those agreements, even if the Court believes the arbitrator wrongly interpreted the agreement. read



8/12
  • Judge Who Ruled Against Arbitration Activist Now an Arbitrator

    A former San Diego Superior Court judge who ruled against arbitration campaigner Jon Perz in his battle with a local car dealership has become an arbitrator. Judge Steven R. Denton sided against Perz during his six-year case against Mossy Toyota in Pacific Beach. Denton retired in June 2013 and soon after went to work for local arbitration company Judicate West. read



  • The emergence of an international arbitration culture

    International arbitration is an obscure field, even among lawyers. However, it is becoming more visible for the simple reason that the field is growing. Arbitration is now one of the most important means for the resolution of international business disputes, including — most notably from the public’s point of view — disputes between investors and the governments of countries in which they invest. Academics and policymakers have begun to describe international arbitration as a form of “global governance.” read



8/05
  • Forbes: The A In A-Rod Stands For Arbitration For A Reason

    Perhaps you are wondering why the most consistent statement from Alex Rodriguez throughout the pregame warm-ups to his suspension has been “I will appeal.” I suspect it is because he is lawyered up and well aware of the fact that through arbitration he has more advantages than if he does not appeal. read



  • Supreme Court’s recent American Express decision has far reaching implications for businesses seeking to avoid being sued in a class action

    The Court held that an arbitration agreement was enforceable regardless of the fact that the cost of pursuing a successful claim individually (rather than as a class) could effectively kill a party’s incentive to bring that claim. This ruling has far reaching implications and will likely lead to an increased use of arbitration agreements as a means to secure individualized treatment of potential future claims and avoid the cost of class litigation by consumers, merchants, employees and the like. read



8/02
  • Burdensome arbitration accords unenforceable, Arizona Court of Appeals says

    Arizonans can sue those who have harmed them, even in some cases in which they had voluntarily agreed to arbitrate instead, the state Court of Appeals has ruled. In a precedent-setting decision, the judges said arbitration agreements that are a financial burden on individuals are legally "unconscionable." And that, they said, makes them unenforceable. read



July 2013

7/30
  • Florida Court Rules that Mandatory Arbitration Contracts in Medical Malpractice Claims Illegal

    The Florida Supreme Court in the case Donna Franks vs. Gary John Bowers, M.D., has rejected written arbitration agreements in medical malpractice cases.   read



  • S'pore experiencing golden age in arbitration: Indranee Rajah

    Singapore is experiencing a golden age in the field of arbitration, said Senior Minister of State for Law Indranee Rajah. The total number of new cases handled by the Singapore International Arbitration Centre (SIAC) increased from 99 cases in 2008 to 235 cases in 2012. read



  • Arbitration nightmare

    Despite win, investors might never be paid.  Investor Sergio Alvarado of Round Lake, Ill., was awarded $748,000 in damages and interest in October after a dispute with his brokerage went through arbitration. Alvarado, however, still hasn't collected a dime. read


7/23
  • NBA's flopping rule could be headed to arbitration

    The National Basketball Players Association is seeking an arbitration hearing on the new flopping rule after the National Labor Relations Board recently declined to rule on it, and instead recommended that the matter be sent to an arbitrator. read



7/21
  • Fine Print: Christie Veto of School Arbitration Bill

    Gov. Chris Christie yesterday vetoed a bill passed this spring in the Senate and Assembly that would have given nonteaching staff in public schools certain job protections, including the right to binding arbitration in disciplinary matters. read



  • Crush of arbitration cases from financial crisis eases

    The surge of securities arbitration cases provoked by the worst financial crisis since the Great Depression is coming to an end. read



7/15
  • Nigeria: Arbitration In Resolution Of Commercial Disputes Will Boost Investors’ Confidence

    Former Chairman, section on Business Law of the Nigerian Bar Association, George Etomi has said that the use of arbitrations in resolving commercial dispute will help to stabilize the country’s growing economy and boost investors’ confidence. read



  • Litigation or arbitration: how best to resolve cross-border disputes in the financial sector?

    A primer on decision-making for financial institutions considering arbitration and drafting arbitration clauses in their cross-border contracts. read



  • Questions and answers about arbitration

    An arbitrator is an impartial party hired as an independent contractor by the employer and union involved in the dispute. They listen to the arguments of the case and write a decision based on the language contained in the union’s collective bargaining agreement and applicable laws. The parties agree in advance that the arbitrator’s decision will be final and binding. read



7/14
  • Once a cheaper alternative, arbitration becoming more costly

    In Ohio, the average cost of an arbitrator runs $1,006 a day, according to a study by the Federal Mediation & Conciliation Service. After fees for travel and other expenses, an arbitrator takes home $4,965 per case, based on an average case duration of about 4.5 days. That’s an 11 percent increase since 2009. read



7/09
  • Factors for Considering Mandatory Arbitration of Employment Disputes

    Arbitration of employment claims can be an effective form of alternative dispute resolution (ADR) that benefits the employee and employer alike. When it works well -- and regardless of whether the employer ultimately is found liable -- both parties can realize cost savings and efficiencies without sacrificing the ability to present your case or the quality of that presentation. Certainly, these are the benefits that make arbitration attractive to companies. However, whether this continues to be the reality of arbitration today is an entirely separate question. read



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