Using Arbitration and Mediation to Resolve Business Software Disputes

Disputes about software ownership and use rights to a software product or software delivered service happen quite frequently. Sometimes those disputes can be solved between the parties by negotiating a mutually satisfactory compromise. If that is not possible expensive and time consuming litigation is the usual result. A cost effective alternative is using an impartial neutral party, an arbitrator or a mediator, to come to a fair decision of who's right and who's wrong. How do you know which kind of alternative dispute resolution is best for you situation? What are the differences between arbitration and mediation?

Arbitration

Non-binding arbitration gives the parties an idea of what a neutral third party thinks. This may help them alter their position making it easier to negotiate a settlement. When you choose to go through binding arbitration, then the decision the arbitrator hands down is usually the final word in your case. Both parties must agree to this way of resolving their differences. Both parties must also agree to abide by the arbitrator's award. It is generally as binding as if a judge had handed down a decision.

Arbitration procedures may involve one arbitrator to hear the case or a panel of several arbitrators, called a tribunal. This decision, or award, is legally enforceable. Arbitration is a way of bypassing the courts for a quicker and less stressful resolution. Most people who go through arbitration have their own attorneys with them, although this is not a requirement to get a fair and impartial award.

Mediation

Mediation is less binding than arbitration. A mediator's role in disputes is usually one of facilitating a settlement and helping the parties finding an acceptable and fair resolution. The mediator, unlike the arbitrator, may try to find creative solutions where parties can develop a solution that meets their needs. It is the mediator's job to assist both parties in reaching a workable solution to their problem that is fair and satisfies both parties. Unlike the arbitrator, the mediator's decisions are not binding, but if the parties come to an agreement, a written negotiated settlement executed by the parties would be a binding solution. The advantage of having a mediator is that the courts are left out of the dispute and the parties can quickly settle their issues. It is a much faster and easier way to resolve a dispute. Mediators are trained in problem solving in a fair and neutral manner. Usually, this type of resolution procedure is entered voluntarily and upon agreement of both parties.

Qualifications

Not just anyone acquainted with the law can become an arbitrator. To meet the criteria of arbitrating cases, an arbitrator has to prove that he can be neutral and not biased. He also must prove his capability in evaluating evidence and the testimony of the parties. Many times the arbitrator can also be an expert in software ownership laws. He should also be a highly reputable member of society. In addition, his experience and education must match the task of arbitrating. Ten years of either legal experience in a law practice or business experience at a top level in a field relating to the case, is a minimum. A mediator is not subject to such a rigorous background, although many mediation firms and services require training or experience from an applicant or employee before they can work as a mediator. The mediator too can have an expertise in software ownership and be familiar with contract laws.

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