OLUNTARY

FEDERAL JUDICIAL CENTER

1994

IN EIGHT FEDERAL DISTRICT

COURTS: AN EVALUATION

RBITRATION

V

A
Voluntary Arbitration

in Eight Federal District

Courts: An Evaluation

David Rauma & Carol Krafka

Federal Judicial Center

1994

This Federal Judicial Center publication was undertaken in furtheranc

Center’s statutory mission to conduct and stimulate research and deve

for the improvement of judicial administration. The views expressed are 

the authors and not necessarily those of the Federal Judicial Center.
ii
Contents

Summary v

1. Introduction 1

2. The Mandatory Arbitration Programs 5

Program Goals 5

Evaluation Findings 6

3. The Voluntary Arbitration Programs 7

Case Eligibility 7

Referral Systems 8

Arbitrators and the Arbitration Process 9

Demands for Trial de Novo 12

4. Participation in the Voluntary Arbitration Programs 15

Arbitration Eligibility and Arbitration Caseloads 16

Arbitration Hearings and Demands for Trial de Novo 17

5. Conclusions 23
iv
Summary

This brief report supplements Court-Annexed Arbitration in Ten District 

1990 statutorily mandated report by the Federal Judicial Center on ma

court-annexed arbitration programs. A 1988 statute authorized the ap

tion of funds for ten pilot mandatory arbitration programs and ten volu

bitration programs and required the Center to submit a report on their op

This supplementary report provides information on eight of the ten v

court-annexed arbitration programs authorized by that statute.

Section 1 explains the pilot arbitration programs, the Center’s statuto

date to provide Congress with information and a recommendation about 

grams’ operation, and events since the Center submitted its 1990 report

Section 2 summarizes the results of the Center’s evaluation of the ma

arbitration programs.

Section 3 describes the main elements of the eight existing voluntary 

tion programs: policies on case eligibility for arbitration; opt-in and opt-o

ral systems; qualifications of and selection of arbitrators; and arbitration 

ings, including demands for trial de novo.

Section 4 summarizes data on levels of participation in the voluntary 

tion programs and demands for trial de novo. Among the findings are th

ing:

• Three of the four opt-out voluntary arbitration programs (but no

four opt-in programs) had rates of participation comparable to tho

mandatory arbitration programs.

• Trial de novo demand rates in the two voluntary arbitration progra

the largest number of hearings were comparable to those of the ma

arbitration programs.

Section 5 suggests some reasons for the generally lower participation 

the voluntary programs as compared with the mandatory programs.
1. See Report of the Proceedings of the Judicial Conference of the United States, Sept. 

The District of Connecticut ended its pilot program in 1982.

2. E. Allan Lind & John E. Shapard, Evaluation of Court-Annexed Arbitration in Th

District Courts (Federal Judicial Center rev. ed. 1983).

3. Report of the Proceedings of the Judicial Conference of the United States, Sept. 19

1. Introduction

Federal courts have been experimenting with both mandatory and volun

binding court-annexed arbitration for more than fifteen years. Arbitrati

of various alternative dispute resolution (ADR) techniques that state an

courts have begun to make available to parties in civil disputes. These tec

also include early neutral evaluation, mediation, and summary jury trial

In nonbinding arbitration, parties to the dispute present their argum

formal or semiformal setting to a neutral arbitrator (or panel of arbitrato

then delivers a decision in the case. One or more parties may choose, 

arbitration decision is announced, to go to trial rather than accept the 

This request for trial de novo puts a case back on the court calendar, and 

proceeds as if the arbitration decision had not been made.

Mandatory arbitration programs typically require that certain cate

civil cases be placed in arbitration, although one or more parties may 

mand trial de novo. In contrast, voluntary arbitration programs gener

vide for arbitration only if all parties agree beforehand. As is true of ma

programs, in voluntary programs, one or more parties may later reques

novo.

The federal courts’ experience with mandatory nonbinding court-ann

bitration began in 1978 with Judicial Conference-authorized pilot prog

the Eastern District of Pennsylvania, the Northern District of California

District of Connecticut.1 An evaluation of these three programs conclu

court-annexed arbitration could reduce the time from filing to disposit

most parties, judges, and attorneys gave arbitration favorable marks; 

there should be further experimentation with arbitration in the federal 

The number of pilot programs was expanded to ten in 1985.3

In 1988, Congress formally authorized the ten existing pilot courts to 

mandatory court-annexed arbitration programs, according to rules spell
2

the legislation, and authorized the Judicial Conference to designate ten ad

districts to conduct voluntary nonbinding court-annexed arbitration pr

The 1988 statute authorized appropriations for program operations and 

a sunset date of November 19, 1993, to allow Congress to consider wh

terminate or continue the pilot programs, or to extend arbitration autho

to additional district courts.4

This legislation also directed the Federal Judicial Center to submit a r

Congress by November 19, 1993, on the implementation of the pilot pr

The Center was also directed to submit a recommendation as to wheth

gress should terminate, continue, or expand the arbitration authority. T

ter issued a report in 1990 detailing the operation of the ten mandatory 

tion programs.5

There were several reasons why the Center did not wait for the end of 

year period, nor wait for data from the voluntary programs to be availabl

issuing its report. First, as a practical matter, the Center wanted Congres

the report in ample time to consider the future of the pilot programs an

ture of arbitration in the federal courts. Second, the voluntary programs w

in starting, and data about their operation would not be available in ti

reported prior to the sunset date.

Third, the statute requesting the study emphasized that the study sh

sess participants’ satisfaction with the program. Given the voluntary n

the arbitration programs, there was no reason to believe that litigants, at

and judges would express less satisfaction with the procedural aspects o

untary programs than they had with mandatory program procedures. 

words, the mandatory programs were considered the baseline for gaugi

faction with voluntary arbitration procedures.

Since the completion of the Center’s report on mandatory arbitration 

lowing events have occurred.

• The Center’s Director forwarded the report to Congress on Octobe

with a recommendation from the Center’s Board that Congress a

mandatory or voluntary arbitration at the discretion of the cou

districts.

4. 28 U.S.C. §§ 651–658.

5. Barbara S. Meierhoefer, Court-Annexed Arbitration in Ten District Courts (Feder

Center 1990).
• At its March 1993 and September 1993 meetings, the Judicial Con

recommended that Congress authorize all districts to adopt volun

bitration and restrict mandatory arbitration to the ten existing pr

• In November 1993, Congress adopted and the President signed Pu

103-192, which extended the twenty pilot districts’ arbitration p

until December 31, 1994.

This report serves as a supplement to the Center’s 1990 report to Con

mandatory arbitration programs. It describes the status of the voluntary p

in operation as of April 1994 and briefly compares the experiences of th

tary programs with the experiences of the mandatory programs. The fin

ported herein are of two types. First, a comparison of the voluntary pr

features shows variations in their design. These variations are within th

established by statute, but they may well affect decisions by litigants to go 

arbitration. There are two general methods of case referral among the e

untary programs: opt-in programs, in which litigants must take steps to 

pate in the arbitration program, and opt-out programs, in which eligible 

“placed” in arbitration initially but litigants are given ample and easy opp

to proceed without arbitration to trial or settlement.

Second, arbitration caseloads in districts with voluntary programs ar

large on average as those in districts with mandatory arbitration program

out programs have the largest caseloads, and these caseloads are compa

size to those of the smallest mandatory programs. Opt-in programs hav

most no cases.
4
2. The Mandatory Arbitration Programs

As noted previously, the ten mandatory arbitration programs are sum

and analyzed in an earlier report by the Federal Judicial Center.6 The ten 

authorized to adopt mandatory arbitration programs are

Eastern Pennsylvania Northern California

Middle Florida Western Michigan

Western Missouri New Jersey

Western Oklahoma Eastern New York

Middle North Carolina Western Texas

Program Goals

Pursuant to the statutory directive, the Center’s study of mandatory arb

assessed how the ten programs met the following goals:

• increasing options for case resolution by providing litigants in ca

normally settle with an opportunity to accept a known adjudicat

neutral third party given at an earlier time than is possible for a tr

• providing litigants with a fair process;

• reducing costs to clients;

• reducing the time from filing to disposition; and

• lessening the burden on the court by reducing the number of ca

require judicial attention, or by reducing the amount of attention re

The research design included a description of and an assessment of arb

programs as conceived and implemented; a determination of the level of 

tion with arbitration in a sample of 62 judges, 3,501 attorneys, and 723 

whose cases were referred to arbitration; and data tracking a twelve-mont

of arbitration cases from each of the ten districts.8

6. Id.

7. Id. at 5.

8. Id. at 2, 21–23. The sample period was extended in four districts to either increase t

size or allow for a slow start-up of the arbitration program.
6

Evaluation Findings

The major findings of the evaluation can be summarized as follows:

• Most cases in these districts were settled without an arbitration he

a trial.

• Although a majority of arbitration hearings ended with a demand 

de novo, most of the parties, when asked, said that they found the 

tion award a good starting point for settlement negotiations and 

hearing was not a waste of time.

• There was no evidence that attorneys and litigants thought that 

tration hearing represented a form of second-class justice. The grea

ity of attorneys surveyed said that they approved of arbitration a

cept and as implemented in their districts (84%). Similarly, the g

jority of litigants surveyed said that the procedures used to han

cases were fair (80%) and that the arbitration hearing was fair (81

• Attorneys’ reports of cost savings differed depending on whether t

a demand for trial de novo after the arbitration hearing. In cases 

no demand for trial de novo was made, a majority of attorneys in 

districts reported cost savings (68%). In cases in which a demand 

de novo was made, the majority of attorneys reported no cost savin

• Only three of the ten districts showed reductions in the dispositi

of civil cases: Middle Florida, Western Michigan, and Western M

• Ninety-seven percent of the judges agreed that the court’s caseload 

had been reduced as a result of the arbitration program.
9. 28 U.S.C. § 652.

3. The Voluntary Arbitration Programs

The ten districts authorized to adopt voluntary arbitration programs are

Arizona Northern Ohio

Middle Georgia Western Pennsylvania

Western Kentucky* Western Virginia*

Northern New York Utah

Western New York Western Washington

Eight of these ten districts have voluntary arbitration programs, and each 

programs has been in operation for more than one year. The remaining 

tricts (marked with an asterisk) do not have arbitration programs.

Tables 1–3 summarize some of the salient and distinguishing featur

eight extant voluntary programs. Table 4 presents information about p

participation for each of these eight districts.

The programs outlined in Tables 1–3 show a number of similarities

one another and to the mandatory programs. However, there are difference

the voluntary programs that may well have implications for their ability 

cases in arbitration. Some of these differences are presented below.

Case Eligibility

Table 1 describes eligibility for arbitration in terms of case type and dollar 

The definition of an eligible case varies somewhat across the programs, a

all definitions are within statutory bounds.9 At one end of the continuum

Georgia refers only specific case types to the program, and only if they ar

at less than $150,000 exclusive of punitive damages. At the other end, sev

tricts place no restrictions on eligible case types and impose no dollar ce

the middle are districts that exclude case types specified by local rule, 

may or may not place a dollar limit on case eligibility.
8

Table 1

Voluntary Arbitration Programs: Case Eligibility

District Program Type Eligible Cases Ceiling

D. Ariz. Opt-out Cases with damages not in excess of $100,00

$100,000a

M.D. Ga. Opt-out Contract or negotiable instrument $150,00

(diversity); personal injury or property

damage; Jones Act; Federal Employers’

Liability Act; cases approved by the

Attorney General where the U.S. is a

party; Miller Act; Federal Tort Claims

Act

N.D.N.Y. Opt-in All civil cases None

W.D.N.Y. Opt-in All civil cases except forfeiture cases None

N.D. Ohio Opt-out All civil cases None

W.D. Pa. Opt-out All civil cases except Social Security and None

prisoner cases

D. Utah Opt-in All civil cases except prisoner cases and None

bankruptcy appeals

W.D. Wash. Opt-in All civil cases None

a. Tax, Age Discrimination in Employment Act, Employee Retirement Income Security Act of 

Security, Title VII, class action, and prisoner cases are excluded, as are pro se litigants and cases p

multidistrict docket.

b. The ceiling is exclusive of punitive damages.

Referral Systems

The eight programs use one of two systems for referring cases to arbitrat

first is an “opt-in” system; the second is an “opt-out” system.

Opt-in systems

The courts in Western New York and Western Washington refer cases to 

tion through simple notification that the arbitration program is availab

gants wish to participate. Litigants can “opt in” to the program.
The court in Northern New York issues a notification of the program 

tation to participate to litigants in selected cases. This court has engaged 

sive bar-outreach efforts to bring notice of the program to potential user

in this district also discuss the availability of arbitration with litigants at 

uled pretrial conference.

Utah’s voluntary arbitration program uses a slightly different opt-in 

system. Litigants in eligible cases must file a certificate indicating whet

wish to be referred to the court’s ADR program, of which voluntary arbit

one option.

Opt-out systems

The other system for referral is more aggressive: The court automatical

all eligible cases in the arbitration program, from which litigants can “o

The courts in Arizona, Middle Georgia, Northern Ohio, and Western Pe

nia have adopted this approach. In the first three districts, parties must 

opt out within twenty days of referral to the program; if they do not, 

considered to have consented to placement in arbitration. Western Penn

has a somewhat more liberal policy, in which parties have an opportuni

out either within ten days of the defendant’s answer or upon motion filed 

the appointment of the arbitrator.

Arbitrators and the Arbitration Process

Table 2 describes features of the arbitrators and the arbitration proces

programs provide for a panel of three arbitrators, some provide for a sin

trator, and some leave the choice to the parties. The arbitrators are lawy

meet qualification standards set by the court and who are willing to serv

case for a prescribed fee. In Western Pennsylvania, for example, attorn

sider such service a form of pro bono work, and the court has a list o

hundred eligible arbitrators. Assignment of arbitrators is typically accom

either by the parties reaching consensus on a nomination or by the rando

ing of names from a qualified pool of potential arbitrators (often with th

tunity for parties to strike names).
10Table 2

Voluntary Arbitration Programs: Arbitrators and Arbitration Process

Selection of Number of Place of Arbitrator’s Authority

District Arbitrators Arbitrators Arbitrator Compensation Timing of Hearing Hearing to Grant ContinuancesD. Ariz. Random 1 $250 per hearing, plus Within 30 days Any agreed- None, but court

selection expenses of appointment upon may grant a

of arbitrator location continuance of up

to 90 days if hearingcannot be held within30 days

M.D. Ga. Random 1 $250 per day, Within 90 days U.S. None, but court may

selection plus mileage of appointment courthouse grant a continuance

of arbitrator for good cause

N.D.N.Y. Nominated or 3 or 1a $250 per day for one Within 5 months Any agreed- None, except in

by random arbitrator or $100 per after answer upon extraordinaryselection arbitrator for panel is filed location circumstances; court

members, plus expenses may grant a

continuance for goodcause

W.D.N.Y. Nominated or 3 or 1a $250 per day for one Within 180 days Any agreed- None, except in

by random arbitrator or $100 per after last answer upon extraordinaryselection arbitrator for panel is filed location circumstances

members, plus expenses
Selection of Number of Place of Arbitrator’s Authority

District Arbitrators Arbitrators Arbitrator Compensation Timing of Hearing Hearing to Grant ContinuancesN.D. Ohio Random 3 or 1a $250 per day for one Within 30 days Any agreed- Arbitrator(s) may grant

selection of 5, arbitrator or $100 per of appointment upon one continuance for notwith strikes arbitrator for panel of arbitrator(s) location more than 30 days fromby parties to members initial hearing date;arrive at court may grantfinal number additional continuances

for good cause

W.D. Pa. Nominated or 3 or 1a $250 per day for one Approximately U.S. None, except in

by random arbitrator or $100 per 150 days after courthouse extraordinaryselection arbitrator for panel answer is filed circumstances

members, plus expenses

D. Utah Nominated or 3 or 1a $250 per day for one Within 120 days U.S. Arbitrator(s) may

by random arbitrator or $100 per of prehearing courthouse reschedule hearingselection of 12, arbitrator for panel conference within 30 days ofwith 4 strikes by members, plus expenses with arbitrator(s) original hearing dateeach party andfinal selection byclerk from remaining names

W.D. Wash. Nominated or 1 $250 per day, Within 180 days U.S. None

selected by plus expenses of filing of courthouseclerk answer or a location
12

At the arbitration hearing, each side presents its case under relaxed 

evidence. The arbitrators issue a decision based on the merits of the case 

termine an award. As Table 2 shows, the timing of the hearing varies so

across districts, but all hearings fall within the time frame specified by st

later than 180 days after the filing of an answer.10 Authority to grant cont

is typically retained by the judge, although arbitrators in several distri

limited authority to grant them. Most programs provide for a hearing in 

courthouse; this setting adds a degree of formality to the proceedings, w

torneys in the mandatory study indicated was an important feature of 

cess.11

Demands for Trial de Novo

After the parties are informed of the arbitration decision, the award is giv

clerk and sealed until the period for filing of trial de novo demands expir

3 presents information about these post-hearing procedures. Litigants 

fied with an arbitration decision have, by statute, thirty days in which 

demand for trial de novo.12 Northern Ohio extends this period to sixty 

the United States when the United States is a party. If a demand for trial d

filed, the case is returned to the regular docket for trial by the assigned ju

the case then proceeds to termination and receives no special procedu

ment because it was in arbitration. If a trial de novo is not demanded, the 

tion award becomes a nonappealable judgment of the court after expirati

filing period.

10. 28 U.S.C. § 653(b).

11. Meierhoefer, supra note 5, at 67.

12. 28 U.S.C. § 655(a).
Table 3

Voluntary Arbitration Programs: Demands for Trial de No

Period for Requesting Potential Disincentives to

District Trial de Novo Request Trial de Novo

D. Ariz. 30 days after the ruling 1. Demanding party forfeits court fees if trial

award is less than 10% more favorable.

2. Demanding party pays attorneys’ fees if tria

award is less than 10% more favorable.

3. Court may sanction one or both parties for

failure to participate in arbitration in a

meaningful way, including the striking of an

demand for trial de novo.

M.D. Ga. 30 days after the ruling None

N.D.N.Y. 30 days after the ruling 1. Demanding party forfeits court fees if trial

award is not more favorable.

2. Demanding party pays attorneys’ fees if tria

award is not more favorable.

3. Court may sanction one or both parties for

failure to participate in arbitration in a

meaningful way.

W.D.N.Y. 30 days after the ruling None

N.D. Ohio 30 days after the ruling; 1. Demanding party forfeits arbitrator fee if tri

60 days for the U.S. award is less than 10% more favorable.

when it is a party 2. Demanding party may be assessed court

costs if trial award is less than 10% more

favorable and the court determines that the

demand for trial de novo was in bad faith.

W.D. Pa. 30 days after the ruling Court may sanction one or both parties for fail

to participate in arbitration in a meaningful w

including the striking of any demand for trial d

novo.

D. Utah 30 days after the ruling None

W.D. Wash. 30 days after the ruling Demanding party may be assessed court costs 

trial award is less than 10% more favorable and

the court determines that the demand for trial 

novo was in bad faith.
14

All courts automatically grant demands for trial de novo. However, fi

eight programs contain possible disincentives to demand trial de novo (s

3). In four of these districts—Arizona, Northern New York, Northern O

Western Washington—a trial de novo requester who fails to receive a mo

able judgment at trial may be required, at the court’s discretion, to pay cou

The courts in Arizona and Northern New York can also require any reque

fails to receive a more favorable judgment to pay the attorneys’ fees inc

the opposing party during the trial. The courts in Arizona, Northern O

Western Washington define “more favorable” to mean that the trial awa

be at least 10% greater than the arbitration award. In Arizona and Weste

sylvania, the court may sanction one or both parties for failing to parti

arbitration in a meaningful way; sanctions may include striking any dem

trial de novo. Whether these possible sanctions have operated as disince

either participation in arbitration or requests for trial de novo is not kno
13. Meierhoefer, supra note 5.

4. Participation in the Voluntary Arbitrati

Programs

The Federal Judicial Center’s evaluation of mandatory arbitration program

comprehensive information about the volume of arbitration cases in the p

tricts and participants’ views of the mandatory arbitration programs.13 Th

ation of the voluntary programs is more limited in scope than the evalu

the mandatory programs, owing to the relative paucity of caseload data 

decision by the Center to forgo the collection of questionnaire data from 

pants.

The lack of caseload data stems primarily from two factors. First, the p

in general have had small arbitration caseloads. Second, as was true with 

datory programs, a large proportion of arbitration-track cases settle befo

ing the hearing stage, and cases terminating at early stages of the proces

representative of cases terminating later. In fact, the decision to forgo co

questionnaire data was based on an early assessment of the caseload n

and an expectation that participant satisfaction with voluntary program

equal or exceed the high levels of satisfaction with mandatory programs

sult, the analysis of the voluntary arbitration programs focuses on the arb

caseload and demands for trial de novo, revealing a number of interest

terns among the voluntary programs and in comparison with patterns 

mandatory programs.

The reported data for each district represent cumulative totals from th

mentation of each district’s program through April 30, 1994. Consequen

tricts’ reporting periods differ in length, ranging from thirteen months 

to thirty-six months for Northern New York. Table 4 shows, for each dist

• the total number of civil case filings during the reporting period;

• among districts with opt-out programs, the number of cases ref

arbitration;

• among districts with opt-out programs, the number of cases exemp

ing out, or transferred to another district;
16

• the number of cases in the arbitration caseload;

• the number of hearings held;

• the number of arbitration awards entered as judgments of the distr

and

• the number of demands for trial de novo after arbitration hearing

Table 5 contains similar information on the ten mandatory program

from the Federal Judicial Center’s earlier report on mandatory arbitratio

information can serve as a counterpoint to the information in Table 4. H

any comparisons between the mandatory and voluntary arbitration p

should be treated with caution, in light of the inherent differences betw

two types of programs.

Arbitration Eligibility and Arbitration Caseloads

The number of arbitration-eligible cases is difficult to identify in districts 

opt-in referral systems. In several of these districts, all civil cases, or all 

civil cases, are potentially eligible (see Table 1). In opt-in districts with 

eligibility criteria, unless the parties request and are accepted into an arb

program, case eligibility is not established. Arbitration-eligible cases are 

identify in the opt-out programs; typically, cases are evaluated by the cler

in order to establish eligibility for referral to the program. Among the 

tricts with opt-out programs, cases initially referred to arbitration durin

porting period represented less than 1% of all civil cases filed in Northe

8% of all civil cases in Western Pennsylvania, 9% of all civil cases in Ariz

14% of all civil cases in Middle Georgia.

Between one-third and one-half of the cases identified as arbitration-e

opt-out programs elected to opt out. As indicated in Table 4, between 

55% of eligible cases left the arbitration programs in Arizona, Middle 

Northern Ohio, and Western Pennsylvania. Among the mandatory pr

Western Missouri lost the greatest proportion of cases through exempti

the arbitration program—31% of the eligible cases were exempted.15

As for the actual arbitration caseload, districts using an opt-out referra

had the largest percentage of cases from the civil caseload participating in 

14. Id. at 42, 49.

15. Id. at 49.
tion. After exemptions, the opt-out program in Arizona had 4% of the cou

caseload, Western Pennsylvania had 5%, and Middle Georgia had 8%. Am

four districts with opt-out programs, Northern Ohio had the smallest pr

of its caseload in the arbitration program—less than 1%—probably bec

court offers an array of alternative dispute resolution programs that inclu

neutral evaluation, mediation, arbitration, and summary jury trial. These 

options may well have affected the number of cases for which arbitration 

sidered the optimal, or even a desirable, ADR method.16

In contrast, few civil cases participated in the opt-in programs. In term

numbers, Northern New York’s program had the largest caseload—four c

ing the three years of its reporting period; Western New York had only 

during the seventeen months of its reporting period. In terms of thei

caseloads, none of the opt-in districts had more than 1% of their civil c

participating in the arbitration program.

Table 5 shows that between 5% and 27% of the civil caseloads in the 

with mandatory arbitration programs were referred to arbitration. Of t

voluntary programs, three of the opt-out programs—Arizona, Middle 

and Western Pennsylvania—had participation rates close to or within th

the other five districts had participation rates smaller than those of the 

tory arbitration programs.

Arbitration Hearings and Demands for Trial de Novo

Table 4 displays the number of arbitration hearings held as of April 30, 19

ern Pennsylvania has had 103 arbitration hearings, the largest number 

ings across all of the voluntary districts. Demands for trial de novo we

after 59% of these hearings. Middle Georgia has had 88 arbitration heari

demands for trial de novo were made after 69% of them. The program in 

has been in operation for a shorter period of time and has had 35 cases 

arbitration hearing. Demands for trial de novo were made after 20% of th

ings. Figures for the remaining districts are so small that they must be view

caution.

16. During 1993, for example, of the 408 cases in Northern Ohio that participated in 

of ADR, 7 went into the arbitration program.
18Table 4

Court-Annexed Arbitration Caseloads in Voluntary Programs

Opt-In Programs Opt-Out Programs

N.D.N.Y. W.D.N.Y. D. Utah W.D. Wash. D. Ariz. M.D. Ga. N.D. Ohio W.D. Pa.

Filing from: 5/91 12/92 3/93 8/92 2/92 8/91 1/92 7/91To: 4/94 4/94 4/94 4/94 4/94 4/94 4/94 4/94Date programbegan 4/15/91 12/1/92 3/1/93 8/1/92 2/1/92 8/8/91 1/1/92 7/1/91Total civil casesfileda 5,020 2,304 1,518 4,667 7,526 2,956 14,737 8,884

Civil casesreferred toarbitration n/a n/a n/a n/a 665 418 24 719(%) (9%) (14%) (< 1%) (8%)Referred casesexempted, optingout, transferred n/a n/a n/a n/a 369 189 9 245(%) (55%) (45%) (38%) (34%)Arbitrationcaseload 4 1 4 3 296 229 15 474Percentage ofcivil cases in
Opt-In Programs Opt-Out Programs

N.D.N.Y. W.D.N.Y. D. Utah W.D. Wash. D. Ariz. M.D. Ga. N.D. Ohio W.D. Pa.

Cases settledbefore hearingb 1 0 1 3 185 108 8 242

Arbitrationhearings 3 1 0 0 35 88 4 103Arbitrationawards enteredas courtjudgmentsc 1 0 0 0 28 16 2 30

De novodemands afterarbitrationhearings 2 1 0 0 7 61 2 61(%) (67%) (100%) (20%) (69%) (50%) (59%)

Cases pendingd 0 0 3 0 76 44 3 135

a. Total civil filings were determined through the Center’s Integrated Civil Database, a standard-format version of the data reported by the courts to the

Administrative Office of the U.S. Courts. Information for the period 10/1/93 through 4/30/94 was obtained from the Administrative Office of the U.S. Courts.

b. Cases settled include cases settled or dismissed prior to the arbitration hearing.c. Awards entered consist of cases for which the 30-day period for requesting trial de novo has expired without a demand for trial de novo.d. Cases pending include cases awaiting expiration of the 30-day period for requesting trial de novo.
20Table 5

Court-Annexed Arbitration Caseloads in Mandatory Programs

E.D. Pa. N.D. Cal. M.D. Fla. M.D.N.C. D.N.J. W.D. Okla. W.D. Tex. W.D. Mich. W.D. Mo. E.D.N.Y.

Filing from: 1/85 10/84 10/84 1/85 3/85 5/85 5/85 7/85 12/85 1/86To: 12/85 12/85 9/85 6/86 3/86 4/86 10/86 12/86 11/86 12/86Total civil casesfiled 7,854 12,255 5,488 2,012 6,333 3,044 1,112 3,095 3,069 4,483Arbitrationcaseload 2,094 669 630 161 1,376 596 144 579 261 423Percentage ofcivil cases inarbitration 27% 5% 10% 6% 18% 18% 9% 16% 6% 8%Arbitrationhearings as apercentage ofarbitration cases 17% 14% 30% 26% 18% 22% 35% 43% 36% 14%De novodemands as apercentage ofarbitration cases 62% 49% 74% 70% 58% 55% 63% 74% 61% 46%Trial rate as apercentage of

arbitration cases 18% 11% 7% 16% 7% 8% 6% 5% 10% 2%
17. Meierhoefer, supra note 5, at 49.

The figures for the mandatory arbitration programs in Table 5 sug

demands for trial de novo in the two voluntary programs with the large

bers of hearings—Middle Georgia and Western Pennsylvania—fall w

range established by the mandatory programs. In the mandatory program

of the cases in which a demand for trial de novo was made settled after the 

and before going to trial.17 Comparable trial information is not available 

tration cases in the voluntary programs, but there is no reason to believe 

ery demand for trial de novo in these programs actually results in a trial.
22
18. This explanation does not hold for Northern New York, which engaged in exte

outreach programs to publicize the arbitration program and inform attorneys about it

benefits.

5. Conclusions

The results of this report can be summarized briefly. The four districts w

untary arbitration programs that rely on an opt-in referral system have h

small number of cases participate in arbitration. In contrast, three of the 

untary programs that use an opt-out referral system—Arizona, Middle 

and Western Pennsylvania—have rates of participation that are roughly 

with rates among the mandatory programs. The other program with an 

referral system—Northern Ohio—has a much lower participation rate, b

offers other ADR programs that may draw cases that might otherwise go 

tration.

Reasons for the low rates of participation in opt-in programs cannot 

tained from the available caseload data. However, we can suggest several 

reasons. Attorneys in courts with opt-in programs may fear that placing 

arbitration could be construed as a sign of weakness. Some attorneys ma

jury trial as soon as possible, without having to go through the arbitrat

gram. Alternatively, attorneys may avoid asking for an arbitration prog

will purportedly cut the time to disposition in a case in which delay se

interests of the client. Of course, these latter two reasons also could be 

explain decisions to opt out of arbitration as well as to not opt in. Attorn

also be reluctant to request placement in a new and untried program, a

the consistent, low rates of participation in these programs, that relucta

persist over time. Finally, many attorneys may still be largely unaware of 

tion as an alternative.18

Features of the opt-in programs specifically or voluntary programs m

erally may have functioned as disincentives to participate, such as the po

of a penalty for demanding trial de novo and then failing to receive a “mo

able” award. However, these possible disincentives, listed in Table 3, seem 

no relationship to either program type or participation rates. The data a

clusive, and therefore this explanation cannot be ruled out, but it seems 

to account for the differences between opt-in and opt-out programs.
24

Whatever the reason for the low levels of participation in opt-in volun

grams, their small number of cases relative to both the opt-out voluntary p

and the mandatory programs argues against the claim that these progra

any aggregate effect on the cost of litigation or on court burden.

Although there are no data on attorney or litigant satisfaction with v

arbitration programs, the high levels of satisfaction among attorneys and 

in mandatory arbitration programs suggest that satisfaction with volun

grams should be at least as high. One would expect attorneys and litigan

press at least as much satisfaction with a process that parties have chosen 

preserves their right to trial de novo.