Welcome to the inaugural post of “On Writs and Wine”, the blog of the Ervin Cohen & Jessup LLP Litigation Department. ECJ is a mid-sized, full-service business and commercial law firm located in Beverly Hills, California. You can visit us on our web site at www.ecjlaw.com. So much for the promo. Now, let’s get down to business.
What this blog is not: A mere reporting of new developments in statutory or case law. There are many on-line services that can provide that information to you. Nor is it a “brag” about our department’s successes, though there are certainly many of those.
What this blog is: A series of takes by seasoned litigators on issues of strategy, fees and litigation economics, legal ethics, and other litigation-related matters which we hope you will find of interest and value.
And finally: At the end of each post, we will recommend a wine for your enjoyment—after all, doesn’t everyone need a drink after dealing with lawyers?. They will all be wines which we have personally experienced and liked. Of course, we welcome your palate’s feedback!
Today’s Take: Be Wary of Arbitration
Arbitration is sold as a quicker and cheaper way to resolve disputes than traditional litigation. In the business and commercial context—it ain’t necessarily so! First of all, in addition to paying your lawyer, you’ll be paying your share of the arbitrator’s hourly fees, whereas your tax dollars already pay your court’s judges. And here’s the deal: Cynically speaking an arbitrator’s interests are best served by being very accommodating to both sides’ lawyers in scheduling matters or letting proceedings stretch on and on; after all, this (a) results in more fees to the arbitrator and (b) avoids offending the lawyers on whom the arbitrator relies to get future work. And even not being cynical, arbitrators in large business and commercial cases usually feel it necessary and appropriate, given the large amount or other issues at stake, to allow the parties the time and discovery necessary to adequately prepare their respective cases. As a result, arbitrators frequently let the parties do almost everything they could do in a normal litigation, so the time and cost savings are minimal.
Besides, most arbitrations are “binding”, meaning that the arbitrator’s award is generally non-appealable and can only be overturned in very limited circumstances. Also, arbitrators generally need not strictly follow the rules of evidence, and many arbitrations are conducted without a court reporter being present, as that would be an additional expense. As a result, the outcome is significantly less predictable, and losing litigants are left much more frustrated, than is the case with a court trial. And if you need provisional relief such as a preliminary injunction or an attachment, courts are usually much more familiar with their requirements and are used to dealing with such requests, especially on very short (“ex parte”) notice; arbitrators are not.
So if you have a choice as to whether to include a mandatory arbitration clause in an agreement, or whether to accept an offer to arbitrate, be wary of arbitrating business and commercial disputes, especially major ones which do not occur on a regular basis. Instead, have your attorney work with you to establish a monthly budget for the litigation and let the litigation process take its course.
Allan Cooper, Head of ECJ’s Litigation Department
Today’s Taste: As an inaugural wine for an inaugural post, my partner Howard Camhi recommends a village Meursault by Matrot. These wines are a pure example of the smoky mineral characteristics of Meursault, are food-friendly, and won’t force you to break your piggy bank ($30-40 per bottle). They are a terrific introduction to white burgundy wines.