Data insights

We speak with Bill Slate, Chairman, CEO and co-founder of Dispute Resolution Data (DRD), to get his insights on the growing availability and use of data in international arbitration, and the tools available to parties to assess risk and decide case strategies. In 2017, DRD was awarded the Global Arbitration Review (GAR) Award for Best Innovation in the Field of International Arbitration.

I spent almost 20 years at the head of the American Arbitration Association (AAA) and Debora Slate (who co-founded DRD with me) spent a similar time focused primarily on mediation and online dispute resolution (ODR).

The modern business world is increasingly reliant on data for its strategic planning and marketing, and we had both frequently heard from well-placed individuals in the corporate world that they would use arbitration, mediation and other forms of ADR with more confidence if relevant and accurate process data was available. This view was confirmed by many of the leaders of ADR institutions with whom we discussed this apparent shortcoming in the market.

After discussing this proposition further with transactional and contentious lawyers, corporate General Counsel, insurers and re-insurers worldwide, we became increasingly confident that a comprehensive database of reliable arbitration and mediation data would be of significant benefit to the business and legal communities. And so DRD was established in early 2015. Since that time, DRD has progressed in leaps and bounds and we were delighted to receive, this year, the Global Arbitration Review (GAR) Award for Innovation in Arbitration.

DRD offers our subscribers access to previously unavailable data on dispute resolution claims, duration and processes. DRD generates geographic and case-type reports from aggregated data contributed by 17 arbitration and mediation institutions and representing data from 185 nations. This includes, for example, reports on average claim amounts by case type, average claim amount versus amount awarded, arbitration and/or settlement outcomes by case type, whether parties frequently file counterclaims and their success rates, and the average length of case. DRD’s reports are dynamically updated with historic and current data contributions.

The best illustration I can offer of the value of DRD data in arbitration proceedings is to be found on the DRD website under “Use of DRD Data in the Steps of an International Arbitration” which shows in more detail how DRD data might profitably be used at 13 different points in an arbitral proceedings. DRD data has parallel value in mediation.

By way of a few brief examples, and as confirmed by a number of Counsel to whom we spoke at the last IBA Annual Meeting, DRD data would be especially useful in discussing with potential clients “global norms” in a given kind of dispute, and DRD data on case type, duration and cost would be useful in establishing a budget for a prospective arbitration or mediation.

Data on settlements, counterclaims, average success rates of arbitration and mediation, the frequency and type of discovery, local court involvement, the relationship between claims and sums awarded, are other examples of the areas in which DRD data should be of significant interest, whether in drafting clauses or in the conduct of proceedings.

There are 17 arbitration and mediation institutions that currently provide data to DRD (the full list is on the DRD website http://www.disputeresolutiondata.com/). From those institutions, we receive regular data on the cases that they administer, with parties from 185 nations, and broken down into fields and sub-fields covering: geographical region, States and domicile; nationalities and languages; currencies; milestone dates; hearings; awards; stays and delays; interim applications and outcomes; post-award applications; joinder; consolidation; bifurcation; methods of tribunal selection; gender of arbitrators and mediators; challenges; State Court intervention; amounts claimed and counterclaimed; sums awarded; legal fees and costs; third-party funding; and more.

In short, the DRD validation process involves both technology and human review on the data contributing and data receiving ends.

Data received by DRD is owned and managed by the independent data contributing institutions, whose staff and leadership are highly principled and competent professionals, as concerned as DRD about the accuracy of the data that they provide. DRD has no authority to change any data it receives from its contributors. If any question or uncertainty arises about data provided, DRD staff communicate with the institution’s staff and if any correction is required it is made by the institution.

In developing our data protocol, we received valuable input from Dr. Jonathan Katz, Head of the Statistics Department at California Polytechnic Institute, who is also the point person for the US Census Bureau. Dr Katz has observed that all arbitral institutions administer cases in broadly the same way, even though their rules may differ. As a consequence, even a small representative group of data providers can speak to a “global norm” on various process issues; perhaps as few as ten institutions. So, for example, while we remain in discussion with three Asianbased institutions, cases involving Asian parties are regularly filed by other institutions, including the ICC.

DRD software, developed by SPARC (now a division of Booz Allen Hamilton), addresses the 207 validation steps that appear in eight pages of the DRD Operating Manual. For example, there are specific validations set up in the application software during template intake to prevent “bad template data” from getting into the database. Data from a case which is a “statistical outlier” for its award size or any other extreme attribute, will not become a part of the active database until at least two other like cases are available for inclusion.

DRD and the contributing institutions fully understand that confidentiality is of fundamental value to commercial arbitration and mediation. Consequently, DRD never receives information regarding a case from any of its data contributors in a form that would in any way breach confidentiality; DRD receives no information as to the identity of the parties, the identity of the arbitrators or mediators, or the advocates representing the parties. Nor does DRD receive information as to the merits of any award. All data presented in DRD’s reports is aggregated.

On a general level, we would want our subscribers and potential subscribers in legal practice, whether transactional or contentious, to understand that DRD does not presume to substitute the accumulated knowledge and expertise of law firms dealing daily with arbitration and other forms of ADR. DRD’s offering is intended to supplement and enhance that knowledge and expertise, and to provide reliable statistical reference points to test assumptions and to point up significant developments and trends in a fast-moving field.

It is also worth clarifying that we are only collecting and processing information regarding international commercial arbitration and mediation. We do not collect information about investment treaty cases nor about purely domestic cases.

We are proud of the uniformly positive reception that our offering has enjoyed, but never complacent as to the challenge of keeping that offering relevant and up-to-date.

We are proud also to have been a pioneer in publically recognizing the importance of gender inclusion within the arbitral process. Two years before the Equal Representation in Arbitration Pledge went public, we had included the gender question in our draft template for data contributors.

We also take great delight in the honor of receiving the 2017 GAR Award for Best Innovation in the field of International Arbitration, which I mentioned in my opening remarks.

Last, but by no means least, we are enormously proud of the contributing institutions, without whose support this potentially transformative initiative would be impossible. They have prevailed upon their boards and their constituents to contribute never-before-available data about the arbitration and mediation process at a time when transparency is so important in all that we do. And for that, we are also very grateful.

As to the future, we shall continually refine and enhance the quality of shared data, taking particular note of comments and recommendations from data users.

We plan in due course to include data from ad hoc cases.

We shall also be reaching out to make data available to assist some of the important entities which strive to advance arbitration and mediation, including ArbitralWomen, the UNCITRAL Arbitration Working Group and the International Mediation Institute (IMI).