II
Calendar No. 514
105TH CONGRESS
2D SESSION
H. R. 3528
IN THE SENATE OF THE UNITED STATES
APRIL 22, 1998
Received; read twice and referred to the Committee on the Judiciary
JULY 30, 1998
Reported by Mr. HATCH, with amendments
[Omit the part struck through and insert the part printed in italic]
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 Representa-
tives 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—
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(1) alternative dispute resolution, when sup-
ported by the bench and bar, and utilizing properly
trained neutrals in a program adequately adminis-
tered by the court, has the potential to provide a vari-
ety of benefits, including greater satisfaction of the
parties, innovative methods of resolving disputes, and
greater efficiency in achieving settlements;
(2) certain forms of alternative dispute resolu-
tion, including mediation, early neutral evaluation,
minitrials, and voluntary arbitration, may have po-
tential to reduce the large backlog of cases now pend-
ing in some federal courts throughout the United
States, thereby allowing the courts to process their re-
maining cases more efficiently; and
(3) the continued growth of Federal appellate
court-annexed mediation programs suggests that this
form of alternative dispute 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.
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SEC. 2. SEC. 3. ALTERNATIVE DISPUTE RESOLUTION PROC-
ESSES 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 resolu-
tion
‘‘(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 proc-
esses such as early neutral evaluation, mediation, mini-
trial, and arbitration as provided in sections 654 through
658.
‘‘(b) AUTHORITY.—Each United States district court
shall authorize, by local rule adopted under section
2071(b) 2071(a), the use of alternative dispute resolution
processes in all civil actions, including adversary proceed-
ings in bankruptcy, in accordance with this chapter, except
that the use of arbitration may be authorized only as pro-
vided in section 654. Each United States district court
shall devise and implement its own alternative dispute res-
olution program, by local rule adopted under section
2071(b) 2071(a), to encourage and promote the use of al-
ternative dispute resolution in its district.
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‘‘(c) EXISTING ALTERNATIVE DISPUTE RESOLUTION
PROGRAMS.—In those courts where an alternative dispute
resolution program is in place on the date of the enact-
ment 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 con-
sistent 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 Cen-
ter and the Administrative Office of the United States
Courts are authorized to assist the district courts in the
establishment and improvement of alternative dispute res-
olution programs by identifying particular practices em-
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ployed in successful programs and providing additional as-
sistance as needed and appropriate.’’.
SEC. 3. 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 pro-
vided in subsections (b) and (c), each district court shall,
by local rule adopted under section 2071(b) 2071(a), re-
quire 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 dis-
pute resolution process, including, but not limited to, me-
diation, 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
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specific cases or categories of cases in which use of alter-
native dispute resolution would not be appropriate. In de-
fining these exemptions, each district court shall consult
with members of the bar, including the United States At-
torney for that district.
‘‘(c) AUTHORITY OF THE ATTORNEY GENERAL.—
Nothing in this section shall alter or conflict with the au-
thority of the Attorney General to conduct litigation on
behalf of the United States, with the authority of any Fed-
eral 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 confidentiality of alternative dispute res-
olution processes under this chapter, each district court
shall, by local rule adopted under section 2071(b), provide
for the confidentiality of the alternative dispute resolution
processes and to prohibit disclosure of confidential dispute
resolution communications.’’.
SEC. 4. SEC. 5. MEDIATORS AND NEUTRAL EVALUATORS.
Section 653 of title 28, United States Code, is
amended to read as follows:
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‘‘§ 653. Neutrals
‘‘(a) PANEL OF NEUTRALS.—Each district court that
authorizes the use of alternative dispute resolution proc-
esses shall adopt appropriate processes for making
neutrals available for use by the parties for each category
of process offered. Each district court shall promulgate 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 neu-
tral in the appropriate alternative dispute resolution proc-
ess. For this purpose, the district court may use, among
others, magistrate judges who have been trained to serve
as neutrals in alternative dispute resolution processes, pro-
fessional neutrals from the private sector, and persons who
have been trained to serve as neutrals in alternative dis-
pute resolution processes. Until such time as rules are
adopted under chapter 131 of this title relating to the dis-
qualification of neutrals, each district court shall issue
rules under section 2071(b) 2071(a) relating to the dis-
qualification of neutrals (including, where appropriate,
disqualification under section 455 of this title, other appli-
cable law, and professional responsibility standards).’’.
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SEC. 5. 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 (b) and (c) subsections
(a), (b), and (c) of section 652 and subsection (d) of this
section, a district court may allow the referral to arbitra-
tion of any civil action (including any adversary proceed-
ing in bankruptcy) pending before it when the parties con-
sent, 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
‘‘(3) the relief sought consists of money dam-
ages in an amount greater than $150,000.
‘‘(b) SAFEGUARDS IN CONSENT CASES.—Until such
time as rules are adopted under chapter 131 of this title
relating to procedures described in this subsection, the dis-
trict court shall, by local rule adopted under section
2071(b) 2071(a), establish procedures to ensure that any
Calendar No. 514
105TH CONGRESS
2D SESSION
H. R. 3528
AN ACT
To amend title 28, United States Code, with re-
spect to the use of alternative dispute resolution
processes in United States district courts, and
for other purposes.
JULY 30, 1998
Reported with amendments