MCLE Self-Study Article: Leveraging Online Dispute Resolution To Improve Consumer Arbitration

By Loïc E. Coutelier ¹, Managing Director, New Actions LLC

The world of online dispute resolution (“ODR”) is expanding as the European Union is about to finalize the drafting of a regulation on ODR paired with a directive about alternative dispute resolution (“ADR”) applied to consumer disputes.² If adopted as they currently stand, these instruments would make it mandatory for all online traders to display a link to an ODR provider. It would also make it mandatory for the member states to have at least one ODR organization in each country. These texts should be adopted by the European legislative organs within the next few months, and form part of the European Union’s longstanding belief that ADR will boost the internal market’s economy. For instance, in 2005, the EU Commission created the European Consumer Centers Network, which provided advice and help in more than 71,000 consumer cases in 2010. The EU support of ODR makes sense in the context of access to justice: cross-border disputes could only benefit from an ODR system, which would solve many issues such as that of forum, the applicable law, and enforcement. It also reduces the costs and length of the whole process. At a more transnational level, the United Nations Commission on International Trade Law (“UNCITRAL”) is also working on draft procedural rules for online dispute resolution for cross-border electronic commerce transactions.³ And if we look at one of America’s neighbors, Canada, we note that the Government of British Columbia adopted the Civil Resolution Tribunal Act in 2012,⁴ which makes full use of ODR technology to run its court proceedings.

These are a few of many recent groundbreaking uses of ODR in the legal context. It is only legitimate to wonder whether or not ODR could be used in the United States, to help the country better face budget cuts to the judiciary, or to address new issues. One of the most promising areas where ODR could bring significant change is consumer arbitration. Indeed, the field of consumer arbitration was radically changed two years ago by the Supreme Court, and although the benefits of arbitration in general could hardly be denied, it seems that existing infrastructure in place in various arbitration institutions is ill-equipped to deal with consumer disputes. ODR could help improve the existing arbitration processes in the context of consumer disputes.

A. AT&T Mobility LLC v. Concepcion