Scarred by SCCAR and Marred by MAR
Why to Avoid Arbitration Like COVID in the COVID Era (And What to Do When You Can’t)
Thursday, March 24, 2022
by: Eddy Silverman, Williams Kastner

Section: Winter 2022

I.  Introduction
I was crestfallen after my first arbitration.  Here I was, on my own finally: “Eddy on the case.”  I had total creative control…I had a defense-minded arbitrator…I felt comfortable during the process.  I was a regular Clarence Darrow in there.  And then the result came back: a decision in the Plaintiff’s favor. 
I had taken an “L” as the kids say, or so I thought.  I sheepishly reported the result to my client via email, only for him to respond with a level of enthusiasm I had not seen from him to that point in time, “Eddy, that is a fabulous result!”  Huh? 
As I would come to learn, losing a little in arbitrator is a win.  Huh??  Well, see, the result was well below the demand, and yet high enough that a de novo trial (appeal) was unlikely.  The ol’ sweet spot.  This was a win!  Yay….
Oh well, that was unpleasant, but hey, at least arbitration is rare in my practice, right?  Wrong.  Arbitration was rare in my practice—my practice of mostly personal injury/premises liability defense cases—but now it is considerably less so.  Why?  Well, because in arbitration the plaintiffs’ bar has found its truly beloved.  Are you telling me there’s a forum where I don’t have to do any discovery; the defense can’t take a summary judgment against me; I am almost certain to get money and the whole thing takes a fraction of the time?  Sign me up brother!
The cat is out of the bag.  The jig is up.  Whatever one wants to say.  Arbitration is having its moment in the COVID era, and largely at the expense of us defense folks.  But fear not, all hope is not lost; Eddy is on the case!   

II.  Why Arbitration Stinks

A.  Your Best Weapon Is More-Or-Less Gone
Take a gander at your local “MAR” rules—yes, this is redundant, as MAR stands for “Mandatory Arbitration Rules”—and you are likely to see a list of “permitted interrogatories” or some other express limitation on the scope of discovery.  Compare Thurston County LMAR 4.2 with SCCAR.[1]  This is great, right?  We do not like responding to discovery either as defendants, do we?  As much as this is true, when it comes down to it, we defendants and defense counsel are more frequent and more effective users of this tool than our plaintiff counterparts.  In other words, the loss of the full battery of discovery tools hurts us more than them. 
We defendants have always plied our trade on the rules, so to speak.  Just speaking for myself, putting the burden of discovery on the other side with tactical intent is a big part of how I work.  The more rules, the better—which is one of the reasons I prefer the federal discovery rules.  Plaintiffs’ attorneys largely ignore the rules that exist, so when those rules do not exist, or when there are considerably less of them, forget about it.  Good luck getting useful information! 
I don’t know about you, but “the amount of special and general damages claimed” and/or “the persons with facts regarding liability and damages” is not much help to me.  See Thurston Cnty. LMAR 4.2(b).  Shoot, in Superior Court I get this with a Request for Statement of Damages and one Interrogatory.  Yes, you still get to take a deposition, but do you not prefer to have robust discovery responses going into one?  I know I do. 

B.  You Will Not Get Summary Judgment
As we all know, it is distressingly easy to file a lawsuit and terribly difficult to get rid of one.  One of the few tools available to the defense to pull the eject cord, so to speak, is a motion for summary judgment.  Well, you can kiss that tool goodbye too.  Even though summary judgment presents superficially to escape arbitration and arbitrator discretion—as the motion will be heard by your original/assigned Superior Court judge under SCCAR 3.2[2]—alas, the prospect of summary judgment is but a mirage.    
Summary judgment is hard enough to get in a “regular” Superior Court case.  Even the weakest opposition is likely to defeat such a motion, and the requirement that factual disputes be “genuine” and/or not self-serving to constitute proper opposition is like some archaic lifestyle choice that no one follows in modern society—like when all men used to wear hats outside.  Now try to get summary judgment when the arbitration is just a couple weeks away (another dispositive hearing for all intents and purposes).  What is the point of summary judgment?  Just have the arbitration, right?   
Or consider a recent situation that happened to me.  I filed a motion for summary judgment, which plaintiff’s counsel responded to by asking the arbitrator for more discovery.  The parties argued before the arbitrator via email (very official), and despite my telling the arbitrator that plaintiff’s counsel would seek to use the request for more discovery to have my motion kicked, and to evade the Court’s discretion to grant discovery under CR 56(f), he granted the plaintiff’s de facto discovery motion anyway.  He gave the plaintiff full superior-court-level discovery in a tiny, small damages case: double-digit interrogatories and requests for production.[3]  Yikes. 
I went from seemingly being on the verge of a cost-effective and quick exit, to staring down the barrel of expensive and invasive discovery.  What happened next was predictable.  Plaintiff’s counsel emailed me to ask me to strike the motion, and I was more-or-less forced to settle the case.  Had the motion been permitted to go forward, in all likelihood I could have obtained a more favorable settlement, or perhaps even had the case dismissed (like it should have been).     

C.  Your Arbitrator Does Not Care About You
Okay, not you, but your case.  I have had an arbitrator fall asleep on me at arbitration.  On me![4] 
“Arbitrators are people too!”  True.  Worse though, they are lawyers, and they have a cost-incentive to be present.  There is no higher purpose or calling.  Your arbitrator wants to be involved in the case less than you do, and even less than your client even (who is being sued).  Likely your arbitrator made up his or her mind long before you ever got to closing argument, and likely not based on anything having to do with the strict application of law-to-facts.    
The informality of arbitration is weird.  It is almost counter-intuitively negative to be well prepared and/or impassioned in one’s presentation, or to go in depth on legal issues in dispute.  To do this smacks of inexperience (it’s not cool).  And a PowerPoint?  Do not do it.      

D.  You Are Going to Lose
Think Stillwell Angel from A League of Their Own taunting you….
You may not lose-lose, but that whole “splitting the baby” thing?  Yeah, that’s real.  Like the “L” I took in my first arbitration, even a win is a loss in the upside-down world of arbitration. 
And when you lose, or when the split comes back, and your client pays, you will accept it.  Why?  Because de novo’ing does not make any sense, especially when there is the possibility you will be on the hook for attorney fees if you do not improve your position.  See SCCAR 7.3. 

III.  What To Do If You Find Yourself in Arbitration

A.  Get While the Gettin’s Good
No case begins in arbitration.  The plaintiff files in Superior Court, and for a brief, wonderful moment, you have the full array of discovery tools available to you.  So, do like I do—fire off that discovery with your Notice of Appearance on Day 1 and let that 30-day clock start to run. 
Now, be warned: if your plaintiff wants to be in arbitration, you are unlikely to get discovery responses back.  The other side off a Statement of Arbitrability before, or even after responses are due.  Still, there is a chance you get back more than you would have before the other side is sure about where they want to be, and if and when you land in arbitration, your request for additional discovery to the arbitrator may carry more weight if you served similar requests in Superior Court pre-transfer that plaintiff was obligated to answer but did not. 

B.  Get Out Of Dodge
The raising of the cap on arbitration damages on September 1, 2018, from $50,000 to $100,000 has made for an unusual, recurring circumstance: under current MAR rules, a case can be transferred to arbitration yet still removable to federal court under the plain language of 28 U.S.C. § 1332.  See 28 U.S.C. § 1332(a) (establishing grounds for removal based on diversity jurisdiction) (“The district courts shall have original jurisdiction of all civil actions where the matter is controversy exceeds the sum or value of $75,000, exclusive of interests and costs, and is between…citizens of different States[.]” ). 
The problem with removing an arbitration case though is that federal court carries the same sort of issues (read: costs) for defendants as it does for plaintiffs.  So, as nice as it is to subject the other side to having to actually retain (read: pay) experts, and to saddle them with a preemptive duty to disclose relevant information and/or state damages, all of these rules will increase the costs on defendants too.  So, while I am generally in favor of putting an adverse party anywhere he or she does not want to be, consider that putting your arbitration case in federal court may prove costly for your client and not make sense in the grand scheme.

C.  Work Up the Case Like A Plaintiff’s Attorney
Oh man, I am loathe to share this particular recommendation, but, hey, like they say, “If you can’t beat ‘em, join ‘em.” 
As much as we should all want to avoid an adverse decision at arbitration, the real issue to avoid—and the one more in our control, comparatively—is the issue of defense costs.  I have gone through the arbitration process enough at this point in my career with the fullest measure of preparation to realize that, on some level, it does not make a difference.  Sorry, but this is true. 
Bringing in your expert live to testify?  Does not matter.  Save your money.  Just submit a declaration (and do not bother giving your expert every single record either or agonize over the content of his or her declaration – just hit the highlights).  That 20-page pre-hearing Statement of Proof?  Maybe cut it down a little.  Seeking to take those three eyewitness depositions in addition to the plaintiff’s deposition?  Maybe don’t.   
I do not mean to advise any attorney to not do his or her job, but there is a practicality to arbitration preparation which I have only now begun to appreciate—and which pains me to acknowledge and accept, as the sort of attorney who likes to turn over every rock.  Make no mistake, controlling costs and being intelligent with the way we work up cases is part of the job. 
The simple fact of the matter is, in 9-out-of-10 arbitration cases, you could probably show up on the day you receive the case file and argue at the hearing and obtain the same result as after several months of discovery.  Let that sink in, and then take it for what it’s worth—it may be worth a lot to your client, who will be the one paying the costs, to include your bills.    

IV.  Conclusion
This is my first WDTL article.  I may evoke the ire of the defense bar with my take on arbitration.  I may get emails extolling the virtues of arbitration.  That’s cool.  Yes, it has its benefits.  I too like quicker, simpler processes, generally speaking—but that is a separate article.
By and large, the arbitration process is not good for us.  The first step to recovery is this recognition.  Only once we recognize the flaws in the system and how the process is being used to the benefit of our adversaries can we begin to improve the way we play the game.  Game on.      
[1] Actually, SCCAR or the Superior Court Civil Arbitration Rules do not allow any Interrogatories as a matter of course.  One has to request additional discovery of this type from the arbitrator. 
[2] See SCCAR 3.2(b)(1) (holding that “The court [not the arbitrator] shall decide[] Motion for involuntary dismissal, motions to change or add parties to the case, and motions for summary judgment[.]”). 
[3] I forgot to mention that, like with most matters of civil procedure, the plaintiffs will get the breaks, not you.  So here we see an exception to the “you won’t get discovery” issue discussed above.
[4] Okay, I cannot say with 100% certainty that he was asleep, but his eyes were closed for a long time and I do not believe this was because he was deep in thought.