Litigation costs too much. Why? Because it is overburdened with process and tolerated but unnecessary excess.  And who benefits from the focus on process and needless discovery and motion practice? Lawyers.  Who designs the processes and rules for discovery?  Lawyers. And who benefits economically from this focus on rules and process? Lawyers.

Lawyers are the problem, not the solution.  While no solution is perfect and lawyers cannot be entirely eliminated from dispute resolution, it is possible to design a solution that gets to fair results quickly with drastically lower costs.

For small cases, much of the cost results from activity with little substantive impact and cases resolve based on the cost of prosecuting or defending the matter rather than on the merits of the dispute.  Parties negotiate from extremes, which makes resolution that much more difficult.

To take the lawyers out of the equation, as well as their costly focus on process and rules, ValoremNext has designed a simple arbitration solution for small cases. Founder Nicole Auerbach, a certified arbitrator, acts as a neutral, using this simplified approach which ensures resolution in under 60 days:

  1. The parties sign a simple agreement consenting to the Valorem Arbitration Program. 2. There is an initial conference, lasting only one hour, within a week after the agreement is signed.  Each party is represented by a business person, who is the party’s spokesman.  A lawyer may join to advise the client.
  2. In the initial conference, each side will explain its view of the dispute, and identify whether the other party has any information essential to a fair evaluation. Each party will also identify what documents it has to support its claims or defenses, including damages.
  3. The initial conference will end with an agreement or order on when each side is to produce its supporting documents and whether any other documents must be produced. There will be presumption against producing large volumes of documents and no fishing expeditions will be permitted.
  4. In the initial conference, the parties will agree or the arbitrator will decide whether a single, one-hour maximum deposition will be permitted by each side and who the deponent will be.
  5. Three weeks after the initial conference, the parties will submit a brief not exceeding 5 double spaced pages, laying out their claims or defenses and arguments for their position.
  6. Within 10 days, the parties will meet telephonically for the hearing. Each side will have 30 minutes to make its case to the arbitrator and the parties will answer any questions the arbitrator has.
  7. Within one hour of the conclusion of the hearing, each side must submit a confidential email to the arbitrator setting forth its proposed resolution.
  8. Within one day, the arbitrator will choose one of the two offers. There is no baby-splitting or compromise of the two submitted offers.  The decision will be announced by forwarding the accepted proposal to the parties with a brief explanation of what factors determined the acceptance of that position.  This explanation will not exceed two paragraphs.
  9. During the period the arbitrator is considering the matter, the parties may share their proposals with each other and attempt to work out a resolution.

The total time from signing the agreement to conclusion is less than 60 days.  The cost of the arbitration is $7500 or 7% of the amount at issue, whichever is greater.  Each party will pay 50% of the fee, unless the parties agree otherwise or a clause in an operative contract says otherwise.

With minimal lawyer involvement, the total expense per party on a $100,000 claim, including legal fees, should be under $5000.

This is a far cheaper and faster way to resolve a dispute than any existing option, and I tip my hat to my partner, Nicole Auerbach, for this client-focused approach. The details and needed documents for the program on available on Valorem’s website.