IB
Union Calendar No. 281
105TH CONGRESS
2D SESSION
H. R. 3528
[Report No. 105–487]
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.
IN THE HOUSE OF REPRESENTATIVES
MARCH 23, 1998
Mr. COBLE introduced the following bill; which was referred to the Committee
on the Judiciary
APRIL 21, 1998
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
[For text of introduced bill, see copy of bill as introduced on March 23, 1998]
A BILL
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 Res-
olution Act of 1998’’.
SEC. 2. 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.
‘‘(b) AUTHORITY.—Each United States district court
shall authorize, by local rule adopted under section 2071(b),
the use of alternative dispute resolution processes in all civil
actions, including adversary proceedings in bankruptcy, in
accordance with this chapter, except that the use of arbitra-
tion may be authorized only as provided in section 654.
Each United States district court shall devise and imple-
ment its own alternative dispute resolution program, by
local rule adopted under section 2071(b), to encourage and
promote the use of alternative dispute resolution in its dis-
trict.
‘‘(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 evalu-
ate the court’s alternative dispute resolution program. 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.
‘‘(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 es-
tablishment and improvement of alternative dispute resolu-
tion programs by identifying particular practices employed
in successful programs and providing additional assistance
as needed and appropriate.’’.
SEC. 3. JURISDICTION.
Section 652 of title 28, United States Code, is amended
to read as follows:
‘‘§ 652. Jurisdiction
‘‘(a) CONSIDERATION OF ALTERNATIVE DISPUTE RES-
OLUTION 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(b), 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, in-
cluding, but not limited to, mediation, early neutral evalua-
tion, 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 dis-
pute resolution would not be appropriate. In defining these
exemptions, each district court shall consult with members
of the bar, including the United States Attorney for that
district.
‘‘(c) AUTHORITY OF THE ATTORNEY GENERAL.—Noth-
ing 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 Attor-
ney General.
‘‘(d) CONFIDENTIALITY PROVISIONS.—Until such time
as rules are adopted under chapter 131 of this title provid-
ing for the confidentiality of alternative dispute resolution
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 proc-
esses and to prohibit disclosure of confidential dispute reso-
lution communications.’’.
SEC. 4. 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
‘‘§ 654. Arbitration
‘‘(a) REFERRAL OF ACTIONS TO ARBITRATION.—Not-
withstanding any provision of law to the contrary and ex-
cept as provided in subsections (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 bankruptcy) pending before it, ex-
cept 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 damages
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), establish procedures to ensure that any civil action
in which arbitration by consent is allowed under subsection
(a)—
‘‘(1) consent to arbitration is freely and know-
ingly obtained; and
‘‘(2) no party or attorney is prejudiced for refus-
ing to participate in arbitration.
‘‘(c) PRESUMPTIONS.—For purposes of subsection
(a)(3), a district court may presume damages are not in
excess of $150,000 unless counsel certifies that damages ex-
ceed such amount.
‘‘(d) EXISTING PROGRAMS.—Nothing in this section is
deemed to affect any action in which arbitration is con-
ducted pursuant to section 906 of the Judicial Improve-
ments and Access to Justice Act (Public Law 100–102), as
in effect prior to the date of its repeal.’’.
SEC. 6. ARBITRATORS.
Section 655 of title 28, United States Code, is amended
to read as follows:
‘‘§ 655. Arbitrators
‘‘(a) POWERS
OF ARBITRATORS.—An arbitrator to
whom an action is referred under section 654 shall have
the power, within the judicial district of the district court
which referred the action to arbitration—
‘‘(1) to conduct arbitration hearings;
‘‘(2) to administer oaths and affirmations; and
‘‘(3) to make awards.
‘‘(b) STANDARDS FOR CERTIFICATION.—Each district
court that authorizes arbitration shall establish standards
for the certification of arbitrators and shall certify arbitra-
tors to perform services in accordance with such standards
and this chapter. The standards shall include provisions re-
quiring that any arbitrator—
‘‘(1) shall take the oath or affirmation described
in section 453; and
‘‘(2) shall be subject to the disqualification rules
under section 455.
‘‘(c) IMMUNITY.—All individuals serving as arbitra-
tors in an alternative dispute resolution program under this
chapter are performing quasi-judicial functions and are en-
titled to the immunities and protections that the law ac-
cords to persons serving in such capacity.’’.
SEC. 7. SUBPOENAS.
Section 656 of title 28, United States Code, is amended
to read as follows:
‘‘§ 656. Subpoenas
‘‘Rule 45 of the Federal Rules of Civil Procedure (relat-
ing to subpoenas) applies to subpoenas for the attendance
of witnesses and the production of documentary evidence
at an arbitration hearing under this chapter.’’.
SEC. 8. ARBITRATION AWARD AND JUDGMENT.
Section 657 of title 28, United States Code, is amended
to read as follows:
‘‘§ 657. Arbitration award and judgment
‘‘(a) FILING AND EFFECT OF ARBITRATION AWARD.—
An arbitration award made by an arbitrator under this
chapter, along with proof of service of such award on the
other party by the prevailing party or by the plaintiff, shall
be filed promptly after the arbitration hearing is concluded
with the clerk of the district court that referred the case
to arbitration. Such award shall be entered as the judgment
of the court after the time has expired for requesting a trial
de novo. The judgment so entered shall be subject to the same
provisions of law and shall have the same force and effect
as a judgment of the court in a civil action, except that
the judgment shall not be subject to review in any other
court by appeal or otherwise.
‘‘(b) SEALING OF ARBITRATION AWARD.—The district
court shall provide by local rule that the contents of any
arbitration award made under this chapter shall not be
made known to any judge who might be assigned to the
case until the district court has entered final judgment in
the action or the action has otherwise terminated.
‘‘(c) TRIAL DE NOVO OF ARBITRATION AWARDS.—
‘‘(1) TIME
FOR
FILING
DEMAND.—Within 30
days after the filing of an arbitration award with a
district court under subsection (a), any party may
file a written demand for a trial de novo in the dis-
trict court.
‘‘(2) ACTION RESTORED TO COURT DOCKET.—
Upon a demand for a trial de novo, the action shall
be restored to the docket of the court and treated for
all purposes as if it had not been referred to arbitra-
tion.
‘‘(3) EXCLUSION
OF
EVIDENCE
OF
ARBITRA-
TION.—The court shall not admit at the trial de novo
any evidence that there has been an arbitration pro-
ceeding, the nature or amount of any award, or any
other matter concerning the conduct of the arbitration
proceeding, unless—
‘‘(A) the evidence would otherwise be admis-
sible in the court under the Federal Rules of Evi-
dence; or
‘‘(B) the parties have otherwise stipulated.’’.
SEC. 9. COMPENSATION OF ARBITRATORS AND NEUTRALS.
Section 658 of title 28, United States Code, is amended
to read as follows:
‘‘§ 658. Compensation of arbitrators and neutrals
‘‘(a) COMPENSATION.—The district court shall, subject
to limits set by the Judicial Conference of the United States,
establish and pay the amount of compensation, if any, that
each arbitrator or neutral shall receive for services rendered
in each case under this chapter.
‘‘(b) TRANSPORTATION ALLOWANCES.—Under regula-
tions prescribed by the Director of the Administrative Office
of the United States Courts, a district court may reimburse
arbitrators for actual transportation expenses necessarily
incurred in the performance of duties under this chapter.’’.
SEC. 10. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated for each fiscal
year such sums as may be necessary to carry out chapter
44 of title 28, United States Code, as amended by this Act.
SEC. 11. CONFORMING AMENDMENTS.
(a) LIMITATION ON MONEY DAMAGES.—Section 901 of
the Judicial Improvements and Access to Justice Act (28
U.S.C. 652 note) is amended by striking subsection (c).
(b) OTHER
CONFORMING
AMENDMENTS.—(1) The
chapter heading for chapter 44 of title 28, United States
Code, is amended to read as follows:
‘‘CHAPTER 44—ALTERNATIVE DISPUTE
RESOLUTION’’.
(2) The table of contents for chapter 44 of title 28,
United States Code, is amended to read as follows:
‘‘Sec.
‘‘651.
Authorization of alternative dispute resolution.
‘‘652.
Jurisdiction.
‘‘653.
Neutrals.
‘‘654.
Arbitration.
‘‘655.
Arbitrators.
‘‘656.
Subpoenas.
‘‘657.
Arbitration award and judgment.
‘‘658.
Compensation of arbitrators and neutrals.’’.
(3) The item relating to chapter 44 in the table of
chapters for Part III of title 28, United States Code, is
amended to read as follows:
‘‘44. Alternative Dispute Resolution ...............................................
651’’.
Union Calendar No. 281
105TH CONGRESS
2D SESSION
H. R. 3528
[Report No. 105–487]
A BILL
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.
APRIL 21, 1998
Reported with an amendment, committed to the Commit-
tee of the Whole House on the State of the Union, and
ordered to be printed