Local Rule Rule 53.2: Arbitration

Rule 53.2 Arbitration

Arbitrators, counsel, and the parties must comply with any Standing and Procedural Orders of the Court related to arbitration procedures, in addition to the provisions of this Rule.

1. Certification of Arbitrators.

A. The Chief Judge shall certify as many arbitrators as he or she determines to be necessary under this rule.

B. Any individual may be certified to serve as an arbitrator if: (1) he or she has been for at least five years a member of the bar of the highest court of a state or the District of Columbia, (2) he or she is admitted to practice before this court, and (3) he or she is determined by the Chief Judge to be competent to perform the duties of an arbitrator.

C. Any member of the bar possessing the qualifications set forth in subsection 1.B, desiring to become an arbitrator, shall complete the application form obtainable in the office of the Clerk and when completed shall file it with the Clerk who shall forward it to the Chief Judge for a determination as to whether the applicant should be certified.

D. Each individual certified as an arbitrator shall take the oath or affirmation prescribed by Title 28 U.S.C. § 453 before serving as an arbitrator.

E. A list of all persons certified as arbitrators shall be maintained in the office of the Clerk.

F. Any member of the Bar certified as an arbitrator may be removed from the list of certified arbitrators for cause by a majority of the judges of this court.

2. Compensation and Expenses of Arbitrators.

The arbitrators appointed to a panel shall each be compensated $175.00 for services in each case assigned for arbitration (and $225 if the arbitration lasts beyond lunch). Whenever the parties agree to have the arbitration conducted before a single arbitrator, the single arbitrator shall be compensated $250 for services in each case assigned for arbitration. The fees shall be paid by or pursuant to the order of the director of the Administrative Office of the United States Courts.

No compensation is permitted for preparation time on the case or for hearings that are cancelled. In the event that the arbitration hearing is protracted, or for cases involving extensive preparation time, the court will entertain a petition for additional compensation. Arbitrators shall not be reimbursed for actual expenses incurred by them in the performance of their duties under this rule.

3. Cases Eligible for Compulsory Arbitration.

A. The Clerk of Court shall, as to all cases wherein only money damages are being sought, and such damages do not exceed $150,000.00, exclusive of interest and costs, designate and process such cases for compulsory arbitration, including adversary proceedings in bankruptcy, but excluding (1) social security cases, (2) cases in which a prisoner is a party, (3) cases alleging a violation of a right secured by the U.S. Constitution, and (4) actions in which jurisdiction is based in whole or in part on 28 U.S.C. § 1343. In cases where an award of counsel fees is permissible, any motion for counsel fees shall be referred to the assigned judge for resolution.

B. The parties may agree by written stipulation that the Clerk shall designate and process for arbitration any civil case eligible for arbitration pursuant to Section 3.A of this rule (including adversary proceedings in bankruptcy) wherein money damages only are being sought in an amount in excess of $150,000.00, exclusive of interest and costs.

C. For purposes of this rule only, damages shall be presumed to be not in excess of $150,000.00, exclusive of interest and costs, unless:

(1) Counsel for plaintiff, at the time of filing the complaint, or in the event of the removal of a case from state court or transfer of a case from another district to this court, within fourteen (14) days of the docketing of the case in this district filed a certification that the damages sought exceed $150,000.00, exclusive of interest and costs; or

(2) Counsel for a defendant, at the time of filing a counterclaim or cross-claim, filed a certification with the court that the damages sought by the counterclaim or cross-claim exceed $150,000.00, exclusive of interest and costs.

(3) The judge to whom the case has been assigned may, sua sponte or upon motion filed by a party prior to the appointment of the arbitrators to hear the case pursuant to section 4.C, order the case exempted from arbitration upon a finding that the objectives of an arbitration trial (i.e., providing litigants with a speedier and less expensive alternative to the traditional courtroom trial) would not be realized because (a) the case involves complex legal issues, (b) legal issues predominate over factual issues, or (c) for other good cause.

D. Counsel's designation is entitled to substantial deference. In rare cases where quantifiable special damages are absent or minimal, the judge may issue a rule to show cause why the case is not eligible for arbitration. Counsel's designation may be disregarded if counsel's assessment of the potential value of the case is objectively unreasonable.

4. Scheduling Arbitration Trial.

A. After an answer is filed in a case determined to be eligible for arbitration, and after the parties have filed the consent/declination of consent to proceed by videoconference, the arbitration clerk shall send a notice to counsel setting forth the date, time, format, and location (if applicable) for the arbitration trial. The date of the arbitration trial set forth in the notice shall be a date approximately one hundred twenty (120) days from the date the answer was filed. The notice shall also advise counsel that they may agree to an earlier date for the arbitration trial provided the arbitration clerk is notified within thirty (30) days of the date of the notice. The notice shall also advise counsel that they have ninety (90) days from the date the answer was filed to complete discovery unless the judge to whom the case has been assigned orders a shorter or longer period for discovery. In the event a third party has been brought into the action, this notice shall not be sent until an answer has been filed by the third party.

B. The arbitration trial shall be held before a panel of three arbitrators, one of whom shall be designated as chairperson of the panel, unless the parties agree to have the hearing before a single arbitrator. The arbitration panel shall be chosen through a random selection process by the clerk of the court from among the lawyers who have been certified as arbitrators. The arbitration clerk shall endeavor to assure insofar as reasonably practicable that each panel of three arbitrators shall consist of one arbitrator whose practice is primarily representing plaintiffs, one whose practice is primarily representing defendants, and a third panel member whose practice does not fit either category. The arbitration panel shall be scheduled to hear not more than four (4) cases on a date or dates several months in advance.

C. The judge to whom the case has been assigned shall at least thirty (30) days prior to the date scheduled for the arbitration trial sign an order setting forth the date and time of the arbitration trial and the names of the arbitrators designated to hear the case. In the event that a party has filed a motion to dismiss the complaint, a motion for summary judgment, a motion for judgment on the pleadings, or a motion to join necessary parties, the judge shall not sign the order until the court has ruled on the motion, but the filing of such a motion on or after the date of said order shall not stay the arbitration unless the judge so orders.

D. Upon entry of the order designating the arbitrators, the parties must send the arbitration clerk an email with a copy of the docket sheet and all relevant pleadings, in the form in which they appear on CM/ECF, as attachments. The email should be sent to the email address designated on the Court website and in accordance with all procedural orders then in effect. The arbitration clerk will then forward the documents to the arbitrators by email, along with a copy of the court's order and any relevant procedural orders.

E. Persons selected to be arbitrators shall be disqualified for bias or prejudice as provided in 28 U.S.C. § 144, and shall disqualify themselves in any action in which they would be required under 28 U.S.C. § 455 to disqualify themselves if they were a justice, judge or magistrate judge.

F. The arbitrators designated to hear the case shall not discuss settlement with the parties or their counsel, or participate in any settlement discussions concerning the case assigned to them.

5. The Arbitration Trial.

A. The trial before the arbitrators shall take place on the date and at the time set forth in the order of the Court. The trial shall take place in the United States Courthouse in a room assigned by the arbitration clerk, unless all parties have consented to proceed by videoconference. The arbitrators are authorized to change the date and time of the trial provided the trial is commenced within thirty (30) days of the trial date set forth in the Court's order. Any continuance beyond this thirty (30) day period must be approved by the judge to whom the case has been assigned. The arbitrators must immediately notify the arbitration clerk of any changes in date or time.

B. Counsel for the parties shall promptly report settlement of the case to the arbitration clerk and all members of the arbitration panel assigned to the case.

C. The trial before the arbitrators may proceed in the absence of any party who, after notice, fails to be present. In the event, however, that a party fails to participate in the trial in a meaningful manner, the Court may impose appropriate sanctions, including, but not limited to the striking of any demand for a trial de novo filed by that party.

D. Federal Rule of Civil Procedure 45 shall apply to subpoenas for attendance of witnesses and the production of documentary evidence at the trial before the arbitrators. Testimony at the trial shall be under oath or affirmation.

E. The Federal Rules of Evidence shall be used as guides to the admissibility of evidence. Copies or photographs of all exhibits, except exhibits intended solely for impeachment, must be marked for identification and delivered to adverse parties at least fourteen (14) days prior to the trial and the arbitrators shall receive such exhibits into evidence without formal proof unless counsel has been notified at least seven (7) days prior to the trial that the adverse party intends to raise an issue concerning the authenticity of the exhibit. The arbitrators may refuse to receive into evidence any exhibit, a copy or photograph of which has not been delivered prior to trial to the adverse party, as provided herein.

F. A party may have a recording and transcript made of the arbitration hearing at the party's expense.

6. Arbitration Award and Judgment.

The arbitration award shall be promptly emailed to the arbitration clerk for docketing after the trial is concluded, and shall be entered as the judgment of the court after the thirty (30) day time period for requesting a trial de novo has expired, unless a party has demanded a trial de novo, as hereinafter provided. 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 it shall not be the subject of appeal. In a case involving multiple claims and parties, any segregable part of an arbitration award concerning which a trial de novo has not been demanded by the aggrieved party before the expiration of the thirty (30) day time period provided for filing a demand for trial de novo shall become part of the final judgment with the same force and effect as a judgment of the court in a civil action, except that it shall not be the subject of appeal.

7. Trial De Novo.

A. Within thirty (30) days after the arbitration award is entered on the docket, any party may demand a trial de novo in the district court. Written notification of such a demand shall be served by the moving party upon all counsel of record or other parties. Withdrawal of a demand for a trial de novo shall not reinstate the arbitrators' award and the case shall proceed as if it had not been arbitrated.

B. Upon demand for a trial de novo, the action shall be placed on the trial calendar of the Court and treated for all purposes as if it had not been referred to arbitration. Any right of trial by jury which a party would otherwise have shall be preserved inviolate.

C. At the trial de novo, the court shall not admit evidence that there had been an arbitration trial, the nature or amount of the award, or any other matter concerning the conduct of the arbitration proceeding unless the evidence would otherwise be admissible in the Court under the Federal Rules of Evidence.

D. To make certain that the arbitrators' award is not considered by the Court or jury either before, during or after the trial de novo, the arbitration clerk shall, upon the filing of the arbitration award, enter onto the docket only the date and "arbitration award filed" and nothing more, and shall retain the arbitrators' award in a separate file in the Clerk's office. In the event no demand for trial de novo is filed within the designated time period, the arbitration clerk shall enter the award on the docket.