The percentage of civil cases that actually reach trial in the Federal courts is estimated to be about 1 percent. Faith S. Hochberg, retired federal judge and experienced FedArb mediator and arbitrator, explains some of the reasons cases don’t reach the trial stage:
Litigation takes businesses away from what they do best, which is business, not litigation. Businesses need to control their risk, insurers need some certainty, and everyone wants some control, so you don’t have random, odd results.
The main benefit of mediation is that the parties remain in control of what happens to them all the time. They’re not throwing the dice and tossing their luck to a jury. Even in bench cases, they’re not saying to the judge, “You decide,” because that decision binds them. Asking a mediator to work with them and their adversary to resolve a dispute is a way to control the outcome. Which isn’t to say that everyone is happy but they know it beats the litigation alternative.
Mediation is the least expensive part of litigation. In terms of what it gets you and the speed in which it gets you there, the cost of mediation is extremely reasonable compared to the enormous monthly bills and the time and emotional grind of litigation.
Arbitration is growing as well, because it’s deemed a faster and less costly way to solve a dispute. If the parties can’t mediate a resolution, arbitration is still better than going to trial. Even if they have no control over the outcome, the parties can select arbitrators who are known for their impartiality and ability to understand the dispute. And the parties can agree to reduce the cost of discovery, which is often out of control in the court system, both in terms of speed and expense.
© Copyright Federal Arbitration, Inc., 2016