Online mediation in IP and tech sectors

The Law Gazette

12 November 2020

This year, many working practices, including those relating to dispute resolution, have had to change suddenly and drastically to deal with the Covid-19 pandemic.

Many disputes moved online as national courts reduced capacity and business interruption events strained commercial relationships. Mediation is one dispute resolution process that has moved online very effectively and is attractive to many businesses because of the level of control that disputing parties can retain.

Mediation is a process where opposing parties attempt to reach a mutually beneficial resolution with the assistance of a neutral intermediary, the mediator. If mediation is not successful, parties are free to pursue arbitration or litigation. The Singapore Convention on Mediation, which came into effect this year, is a recent boost to mediation; mediation agreements are now directly enforceable in countries which have ratified the Singapore Convention, similar to the way in which arbitration agreements are enforceable under the New York Convention.

The World Intellectual Property Organization (WIPO) Arbitration and Mediation Center (WIPO Center), which has administered over 740 mediation, arbitration and expert determination cases, has extensive experience of the commercial benefits of mediation to resolve IP and technology disputes. These benefits flow primarily from the fact that mediation focuses on what is of mutual benefit to the parties, regardless of which party may be 'right'. Mediation empowers businesses to find a solution tailored to both of their needs while leaving the safety net of other dispute resolution methods firmly in place.

Mediation may be attractive to businesses reluctant to pursue dispute resolution, whether that is out of a desire to minimise costs or to avoid damaging a business relationship. In WIPO’s experience, one of the greatest benefits of mediation is that it allows restructuring, rather than termination, of business relationships. One WIPO mediation case started as a hostile multimillion-dollar patent dispute in which the claimant intended to file patent infringement proceedings in three jurisdictions; instead, through a two-day WIPO mediation session, the parties not only settled but agreed new commercial contracts. In another recent WIPO mediation held entirely via videoconferencing, a five-year trademark dispute between a Malaysian and Singaporean company was settled within just three weeks of the start of the mediation process. Despite the parties being very far apart on the disputed issues, a settlement agreement was signed at the end of a one-day mediation session in which all the participants attended via videoconference. This case demonstrated how online mediation can be effective even with long-standing and challenging disputes.

The option to participate remotely also cures a problem that can arise in all mediations: the lack of engagement by a party’s ultimate decision-maker. If a decision-maker doesn’t participate in the mediation (due to, for example, being unable to travel), he or she may not appreciate the nuances of the other party’s demands and concerns. This can result in an unwillingness to compromise or an inability to find a creative solution. Remote participation makes it easier for such decision-makers to be present throughout the mediation and therefore increase the chances of the mediation being successful.

Online mediation doesn’t need to be conducted exclusively online. Parties have the flexibility to have hybrid mediation sessions where one party representative attends via tele- or videoconference while the rest of the participants are present in person. Another hybrid format is to have one session conducted in-person and follow-up sessions conducted online. Such flexibility can be very important; for example, in a recent WIPO trademark opposition case held entirely online (as a result of Covid-19), the parties required an additional day for mediation. As everything was online and no one had to travel, another session was set up easily the next day and the parties reached an agreement. Had this occurred pre-Covid-19, the second session would likely have been significantly postponed, delaying the process and potentially compromising the relationship dynamic that had developed.

Mediation can also reduce costs by doing away with costly and time-consuming submissions. If mediation occurs early in a dispute, fewer legal fees may be incurred in the production of legal opinions or submissions. Online or remote mediation can result in further cost-savings as parties and counsel can avoid the cost and time that they would otherwise incur travelling to meetings.

Resolving disputes through mediation and doing so partly or entirely online has been possible for many years. The WIPO Center has been providing online case administration tools for over a decade and has found that generally the online conduct of mediation proceedings has a positive impact on the time-and-cost efficiency and settlement rate of cases. The WIPO Center has produced a checklist of issues that should be considered by parties when conducting mediations online, based on the WIPO Center’s experience of providing video-conferencing facilities and other technical support for online mediation sessions. Some key practical considerations included in the checklist are: (1) choice of online platform (taking into account, for example, data protection issues and platform functionalities, such as the availability of 'waiting rooms'), (2) adaptation of meeting schedules to suit the online format of the mediation, and (3) creation of additional protocols or guidance by the mediator in relation to, for example, recording meetings, controlling who may attend the mediation, and planning for back-up options in the event of technical failure.

Covid-19 has given businesses, and the legal sector, an immediate need for online dispute resolution. However, businesses who take the time to understand the benefits of online dispute resolution generally will have more tools at their disposal in future disputes.

The WIPO Center welcomes further queries regarding online mediation and its other services and can be reached at arbiter.mail@wipo.int. The WIPO Center is also holding a free-of-charge online Workshop on 2-4 December on arbitration and mediation which will cover industry views on dispute resolution, drafting effective dispute resolution clauses and a look at the move to online meeting and hearings – registration is open and can be accessed here: https://www.wipo.int/amc/en/events/workshops/2020/arbmedus/index.html

Heike Wollgast and Margarita Kato, WIPO Arbitration and Mediation Center

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