Technology

Faith In Remote Working Fuels Faith In Efficient Online Arbitration

FairClaims takes aim at the $25K-$250K market.

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The legal industry is still navigating the fallout from the COVID-19 pandemic. Well, in some parts of the country. In places like Texas and Florida, it might be premature to use the term “fallout.” In any event, the industry is in a state of flux, with prominent firms realizing that 2020 proved that remote work — at least occasionally — is still massively profitable.

That’s a testament to the march of legal technology over the last decade. While the field built up the capacity to securely and efficiently run a global practice, it set the table for firms to seamlessly generate massive revenue while in lockdown. Even the stodgiest of holdouts have come to grips with the promise of this tech.

And that comfort is translating to other corners of the legal world.

Arbitration is already a bid to resolve disputes more cheaply and efficiently than the courts, but with the help of modern advancements, it can get even smoother.

FairClaims, which has been around since 2015 resolving small-claims disputes, launched FastTrack Arbitration earlier this year, moving the company into the world of disputes valued at over $25K. This is a direct shot across the bow of AAA and JAMS who’ve dominated the arbitration market for years and the pricing differential is… stark.

Like… upwards of 80 percent cheaper in some cases levels of stark.

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How do they pull this off? First, the process will be automated, streamling the administrative tasks. Second, cases under $250K will be decided on the documents alone, while hearings will always be handled remotely. The neutrals recruited by FairClaims boast extensive experience and even include a number of former AAA arbitrators.

But the growing comfort with online dispute resolution isn’t likely to be universal. Stephen Kane, founder and CEO of FastClaims, thinks the Biglaw players are still going to be holdouts… not because they don’t trust that there’s a more efficient way, but because efficiency may not be in their clients’ best interests. Back in April, Kane spoke with Bob Ambrogi about why FastClaims will get the most traction with smaller firms:

He believes that many larger law firms and companies do not actually want to resolve disputes more quickly, especially when they are with consumers, smaller businesses, and smaller law firms.

And he believes that the consumers, small businesses and small firms that would most benefit from the speed and lower cost of online ODR are often the ones with the least information and expertise about the process.

I’ll add “at first.” Maybe I’m a little more optimistic, but while the appeal is instantly obvious in disputes between smaller firms working with parties who both want a matter resolved fast, the day is coming where top-dollar clients recognize that there are $150K disputes that just don’t justify playing games and throwing fees at a war of attrition.

But, for the first time in the arc of online dispute resolution, folks are looking to employ these services for bigger-ticket items. Even if that’s not bringing in Biglaw, it’s a testament to a legal community out there actively searching for new ways to do old jobs.

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HeadshotJoe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.

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