H. R. 3528
One Hundred Fifth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Tuesday,
the twenty-seventh day of January, one thousand nine hundred and ninety-eight
An Act
To amend title 28, United States Code, with respect to the use of alternative
dispute resolution processes in United States district courts, and for other purposes
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Alternative Dispute Resolution
Act of 1998’’.
SEC. 2. FINDINGS AND DECLARATION OF POLICY.
Congress finds that—
(1) alternative dispute resolution, when supported by the
bench and bar, and utilizing properly trained neutrals in a
program adequately administered by the court, has the poten-
tial to provide a variety of benefits, including greater satisfac-
tion of the parties, innovative methods of resolving disputes,
and greater efficiency in achieving settlements;
(2) certain forms of alternative dispute resolution, including
mediation, early neutral evaluation, minitrials, and voluntary
arbitration, may have potential to reduce the large backlog
of cases now pending in some Federal courts throughout the
United States, thereby allowing the courts to process their
remaining cases more efficiently; and
(3) the continued growth of Federal appellate court-annexed
mediation programs suggests that this form of alternative dis-
pute resolution can be equally effective in resolving disputes
in the Federal trial courts; therefore, the district courts should
consider including mediation in their local alternative dispute
resolution programs.
SEC. 3. ALTERNATIVE DISPUTE RESOLUTION PROCESSES TO BE
AUTHORIZED IN ALL DISTRICT COURTS.
Section 651 of title 28, United States Code, is amended to
read as follows:
‘‘§ 651. Authorization of alternative dispute resolution
‘‘(a) DEFINITION.—For purposes of this chapter, an alternative
dispute resolution process includes any process or procedure, other
than an adjudication by a presiding judge, in which a neutral
third party participates to assist in the resolution of issues in
controversy, through processes such as early neutral evaluation,
mediation, minitrial, and arbitration as provided in sections 654
through 658.
H. R. 3528—2
‘‘(b) AUTHORITY.—Each United States district court shall
authorize, by local rule adopted under section 2071(a), the use
of alternative dispute resolution processes in all civil actions, includ-
ing adversary proceedings in bankruptcy, in accordance with this
chapter, except that the use of arbitration may be authorized only
as provided in section 654. Each United States district court shall
devise and implement its own alternative dispute resolution pro-
gram, by local rule adopted under section 2071(a), to encourage
and promote the use of alternative dispute resolution in its district.
‘‘(c) EXISTING ALTERNATIVE DISPUTE RESOLUTION PROGRAMS.—
In those courts where an alternative dispute resolution program
is in place on the date of the enactment of the Alternative Dispute
Resolution Act of 1998, the court shall examine the effectiveness
of that program and adopt such improvements to the program
as are consistent with the provisions and purposes of this chapter.
‘‘(d) ADMINISTRATION
OF ALTERNATIVE DISPUTE RESOLUTION
PROGRAMS.—Each United States district court shall designate an
employee, or a judicial officer, who is knowledgeable in alternative
dispute resolution practices and processes to implement, administer,
oversee, and evaluate the court’s alternative dispute resolution pro-
gram. Such person may also be responsible for recruiting, screening,
and training attorneys to serve as neutrals and arbitrators in
the court’s alternative dispute resolution program.
‘‘(e) TITLE 9 NOT AFFECTED.—This chapter shall not affect
title 9, United States Code.
‘‘(f ) PROGRAM SUPPORT.—The Federal Judicial Center and the
Administrative Office of the United States Courts are authorized
to assist the district courts in the establishment and improvement
of alternative dispute resolution programs by identifying particular
practices employed in successful programs and providing additional
assistance as needed and appropriate.’’.
SEC. 4. JURISDICTION.
Section 652 of title 28, United States Code, is amended to
read as follows:
‘‘§ 652. Jurisdiction
‘‘(a) CONSIDERATION OF ALTERNATIVE DISPUTE RESOLUTION IN
APPROPRIATE CASES.—Notwithstanding any provision of law to the
contrary and except as provided in subsections (b) and (c), each
district court shall, by local rule adopted under section 2071(a),
require that litigants in all civil cases consider the use of an
alternative dispute resolution process at an appropriate stage in
the litigation. Each district court shall provide litigants in all civil
cases with at least one alternative dispute resolution process,
including, but not limited to, mediation, early neutral evaluation,
minitrial, and arbitration as authorized in sections 654 through
658. Any district court that elects to require the use of alternative
dispute resolution in certain cases may do so only with respect
to mediation, early neutral evaluation, and, if the parties consent,
arbitration.
‘‘(b) ACTIONS EXEMPTED FROM CONSIDERATION OF ALTERNATIVE
DISPUTE RESOLUTION.—Each district court may exempt from the
requirements of this section specific cases or categories of cases
in which use of alternative dispute resolution would not be appro-
priate. In defining these exemptions, each district court shall consult
H. R. 3528—3
with members of the bar, including the United States Attorney
for that district.
‘‘(c) AUTHORITY OF THE ATTORNEY GENERAL.—Nothing in this
section shall alter or conflict with the authority of the Attorney
General to conduct litigation on behalf of the United States, with
the authority of any Federal agency authorized to conduct litigation
in the United States courts, or with any delegation of litigation
authority by the Attorney General.
‘‘(d) CONFIDENTIALITY PROVISIONS.—Until such time as rules
are adopted under chapter 131 of this title providing for the con-
fidentiality of alternative dispute resolution processes under this
chapter, each district court shall, by local rule adopted under section
2071(a), provide for the confidentiality of the alternative dispute
resolution processes and to prohibit disclosure of confidential dis-
pute resolution communications.’’.
SEC. 5. MEDIATORS AND NEUTRAL EVALUATORS.
Section 653 of title 28, United States Code, is amended to
read as follows:
‘‘§ 653. Neutrals
‘‘(a) PANEL OF NEUTRALS.—Each district court that authorizes
the use of alternative dispute resolution processes shall adopt appro-
priate processes for making neutrals available for use by the parties
for each category of process offered. Each district court shall promul-
gate its own procedures and criteria for the selection of neutrals
on its panels.
‘‘(b) QUALIFICATIONS AND TRAINING.—Each person serving as
a neutral in an alternative dispute resolution process should be
qualified and trained to serve as a neutral in the appropriate
alternative dispute resolution process. For this purpose, the district
court may use, among others, magistrate judges who have been
trained to serve as neutrals in alternative dispute resolution proc-
esses, professional neutrals from the private sector, and persons
who have been trained to serve as neutrals in alternative dispute
resolution processes. Until such time as rules are adopted under
chapter 131 of this title relating to the disqualification of neutrals,
each district court shall issue rules under section 2071(a) relating
to the disqualification of neutrals (including, where appropriate,
disqualification under section 455 of this title, other applicable
law, and professional responsibility standards).’’.
SEC. 6. ACTIONS REFERRED TO ARBITRATION.
Section 654 of title 28, United States Code, is amended to
read as follows:
‘‘§ 654. Arbitration
‘‘(a) REFERRAL OF ACTIONS TO ARBITRATION.—Notwithstanding
any provision of law to the contrary and except as provided in
subsections (a), (b), and (c) of section 652 and subsection (d) of
this section, a district court may allow the referral to arbitration
of any civil action (including any adversary proceeding in bank-
ruptcy) pending before it when the parties consent, except that
referral to arbitration may not be made where—
‘‘(1) the action is based on an alleged violation of a right
secured by the Constitution of the United States;
‘‘(2) jurisdiction is based in whole or in part on section
1343 of this title; or