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Technology’s Impact: The Quest for a
New Paradigm for Accountability
In the annals of the online universe, eBay’s rise from an obscure
website for the exchange of collectibles to a flourishing business and
community with over one hundred million registered users in one
is a familiar story. However, there is a
lesser known side to eBay’s success—the company’s decision to en-
dorse and offer to its users, early in its development, the services of
SquareTrade, an online dispute resolution (ODR) provider, for the
resolution of grievances among eBay users.
The SquareTrade story is significant for several reasons: it un-
derscores the need for effective online dispute resolution systems in a
connected society; it provides a demonstration of one context in which
ODR has proven successful despite initial skepticism; and most sig-
nificantly for the thesis of this Article, it affords fresh insights into
what has seemed like an insoluble dilemma in the mediation world—
how to reconcile the need for accountability with mediation’s core fea-
tures of confidentiality and flexibility.
On one level, SquareTrade reflects the need for effective mecha-
nisms for resolving online disputes, given the increasing number of
activities, commercial and social, that take place on the Internet. E-
commerce has grown exponentially over the last decade, expanding
† Assistant Professor of Law, Haifa University. This Article draws on a doc-
toral dissertation written at Columbia Law School under the title “From Settlement
to Justice: Dispute Resolution in the Internet Age.” The ideas and comments I re-
ceived from Eben Moglen, Carol Liebman, Susan Sturm, Robert Ferguson, Ethan
Katsh, Colin Rule, Faina Milman, Joseph Triebwasser, and Itamar Rabinovich, were
indispensable. Without the helpful collaboration of Cara Cherry-Lisco, Elizabeth Cle-
mants, and Nate Lipscomb, this work would not have been possible. My exchanges
with them were stimulating and enriching. Finally, a special thanks to the editors at
Harvard Negotiation Law Review
for their thoughtful comments.
1. EBay Global Trade, http://pages.ebay.com/globaltrading/seller (last visited
Jan. 9, 2005).
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Harvard Negotiation Law Review
well beyond the small-scale, niche items sold through the Internet in
the 1990s to include transactions that involve a wide variety of prod-
ucts and services among an ever more diverse base of Internet users.
In addition, the Internet has become a central arena for social inter-
action and the exchange of ideas. Intensive commercial and social
activities inevitably result in some level of conflict. When such activi-
ties take place among strangers, the potential for misunderstand-
ings, mistakes, and fraud is augmented. In addition, mechanisms for
the swift unmediated resolution of disputes, such as ongoing relation-
ships or reputations, are often absent.
Aware of the risks associated with one-shot online transactions,
eBay has been committed to ensuring its users a safe experience from
the very beginning. It offers a range of tools to its millions of users,
including insurance for transactions, a feedback-rating system for
buyers and sellers,
and SquareTrade’s dispute resolution services.
In providing ODR services through SquareTrade, eBay recognizes
that its users have no real alternatives for pursuing grievances. This
is because the costs associated with litigation or alternative dispute
resolution (ADR) are prohibitive, given that many of the disputes are
over small sums of money and that parties are often geographically
distant from one another. In fact, much of the discussion in the liter-
ature has focused on this aspect of the eBay-SquareTrade effort—its
importance for boosting consumer confidence and enhancing e-
2. Feedback ratings are given by sellers and buyers to one another as part of a
mechanism developed by eBay to overcome anxiety by its users about transacting
with complete strangers. Through the rating system, eBay was able to create long-
term reputational stakes for buyers and sellers that have often proved more impor-
tant to parties than the disputed sum in a given transaction. EBay Feedback Forum,
http://pages.ebay.com/services/forum/feedback.html (last visited July 4, 2005).
David E. Sorkin,
Payment Methods for Consumer-to-Consumer Online
, 35 A
. 1, 3 (2001); Lucille M. Ponte,
Confidence in E-Business: Recommendations for Establishing Fair and Effective Dis-
pute Resolution Programs for B2C Online Transactions
, 12 A
. L.J. S
. & T
441–45 (2002); John MacDonnell,
Exporting Trust: Does E-Commerce Need a Cana-
dian Privacy Seal of Approval?
, 39 A
. 346, 347 (2001); Miriam R. Albert,
E-Buyer Beware: Why Online Auction Fraud Should Be Regulated
, 39 A
575, 632–34 (2002); Richard Birke & Louise E. Teitz,
U.S. Mediation in 2001: The
Path that Brought America to Uniform Laws and Mediation in Cyberspace
, 50 A
. L. 181, 209 (2002); Mary S. Martin,
Keep it Online: The Hague Convention and
the Need for Online Alternative Dispute Resolution in International Business-to-Con-
, 20 B.U. I
L.J. 125, 150–58 (2002); Louise E. Teitz,
Legal Services for the Middle Class in Cyberspace: The Promise and Challenge of On-
line Dispute Resolution
, 70 F
. 985, 996 (2001); William Krause,
Want to Step Outside? An Overview of Online Alternative Dispute Resolution
, 19 J.
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On a second level, SquareTrade demonstrates the ways in which
ODR—though significantly different from traditional ADR—can nev-
ertheless be an effective means for addressing the types of disputes
handled by SquareTrade in the eBay context. The term ODR encom-
passes several forms of dispute resolution, such as negotiation, medi-
ation, and arbitration, which are offered on the Internet and are
conducted through written digital communications. This contrasts
with ADR services, which are typically conducted orally, in a face-to-
face setting. The in-person quality of ADR has been considered es-
sential for two reasons: (1) it allows for rich communication that in-
cludes body language, tone of voice, and silence (all of which are
absent from the written format), and (2) it ensures confidentiality
(while written digital communications have permanence and hence
the potential to be disseminated). Both elements—the richness of
communications and confidentiality of the proceedings—are among
the cornerstones of ADR.
All the same, ODR has proven successful in specific contexts, as
illustrated by SquareTrade.
SquareTrade’s “docket” mostly consists
of discrete contractual disputes in which the parties are strangers to
one another. Many of these are, as has been noted, monetary dis-
putes over low-dollar-value transactions. As such, they tend to be
less emotionally charged, and disputants tend to be relatively indif-
ferent to confidentiality. In other cases, even where emotion runs
. L. 457, 462–63 (2001); Susan Block-Lieb,
tion: Building Trust in Electronic Commerce
, 62 L
. L. R
. 1199, 1219 (2002).
notes 40–55 and accompanying text for a discussion of the essential
role confidentiality and flexibility occupy in mediation.
5. Other contexts in which SquareTrade is often cited include the debate over
the possibility of conducting mediation online (in general or in particular contexts),
the analysis of its pros and cons, and the discussion of the growth of ODR.
Joseph W. Goodman,
The Pros and Cons of Online Dispute Resolution: An Assessment
of Cyber-Mediation Websites
, 2003 D
L. & T
. 4, *3–8 (2003); Cheri M.
Cybermediation: A New Twist on an Old Concept
, 12 A
. L.J. S
. & T
715, 736 (2002); Janice Nadler,
Rapport in Legal Negotiation: How Small Talk Can
Facilitate E-mail Dealmaking
, 9 H
. L. R
. 223, 227 n.14 (2004); Nancy N.
“MEDISPUTE: Resolving Health Care Conflicts”: Resolving Conflicts Over
, 5 J. H
L. & P
479, 491 (2002); Joseph A. Zavaletta,
Using E-Dispute Technology to Facilitate the Resolution of E-Contract Disputes: A
, 7 J. T
. L. & P
2, *7–10 (2002); Ethan Katsh,
Resolution: Some Lessons from the E-Commerce Revolution
, 28 N. K
. L. R
813–14 (2001); Aashit Shah,
Using ADR to Resolve Online Disputes
, 10 R
. J.L. &
. 25, *4–10 (2004); Gregory P. Ewing,
Using the Internet as a Resource for Alter-
native Dispute Resolution and Online Dispute Resolution
, 52 S
1222–24 (2002); Beatrice Baumann,
Electronic Dispute Resolution (EDR) and the De-
velopment of Internet Activities
, 52 S
. 1227, 1232–36 (2002).
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Harvard Negotiation Law Review
high or confidentiality is a pertinent concern, the de facto lack of al-
ternatives for the pursuit of such grievances, combined with incen-
tives created by both eBay and SquareTrade, render ODR an
attractive choice for disputes that originated on eBay.
Lastly and most importantly, the SquareTrade experience points
to new possibilities for addressing one of the most difficult problems
in the mediation world—the accountability dilemma. This dilemma
stems from the fact that accountability hinges on transparency and
while mediation’s strength is drawn, to a large extent,
from its confidentiality and flexibility.
Traditionally, flexibility and
confidentiality have been perceived as preventing the collection of
real-time information on mediation proceedings and producing vague
and overly broad standards for mediator performance. Therefore, it
has been difficult to direct mediator performance ex ante and monitor
the quality of mediation services delivered ex post—elements essen-
tial for generating accountability.
This Article addresses SquareTrade’s contributions to the long-
standing accountability dilemma in mediation. Much of the litera-
ture on ODR and accountability has overlooked technology’s potential
for enhancing accountability
and has viewed the delivery of dispute
resolution services online as creating an accountability deficit be-
cause of the absence of regulation and accepted standards in the
However, as explained further below, the existence of regula-
tion or the adoption of voluntary standards does not guarantee ac-
countability in mediation. What is required is a paradigm shift.
In the Parts that follow, I will describe the SquareTrade system,
elaborate on the nature of the accountability problem, and briefly
sketch traditional approaches for addressing it. I will then examine
the features of the SquareTrade system that have allowed it to deal
with the dilemma in a different, more effective manner. I will con-
clude with some thoughts on the potential and limitations of the
note 30 and accompanying text.
notes 40–50 and accompanying text.
8. This is not to claim that technology necessarily enhances accountability.
However, technology makes information recording and analysis inexpensive and ef-
fortless and introduces an element of structure that can set limits on decision-maker
Lucille M. Ponte,
Throwing Bad Money After Bad: Can Online Dispute
Resolution (ODR) Really Deliver the Goods for the Unhappy Internet Shopper?
, 3 T
. & I
. 55, 87–88 (2001); Ponte,
note 3, at 479–81 (2002);
note 3, at 1009–16 (2001); Thomas Schultz,
Does Online Dispute Resolu-
tion Need Governmental Intervention? The Case for Architectures of Control and
, 6 N.C. J.L. & T
. 71, 86–93 (2004).
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SquareTrade accountability paradigm for other contexts, on- and off-
line, focusing on a recent initiative by Safe Horizon, a leading New
York-based community mediation center.
The SquareTrade Dispute Resolution System
SquareTrade is a private, for-profit ODR provider established in
1999. It views its role as establishing trust in online transactions by
providing an effective means for the resolution of individual dis-
Even though SquareTrade’s services are not offered exclu-
sively to eBay users, eBay disputes have been by far the most
numerous among SquareTrade’s impressive caseload:
over one mil-
lion disputes spanning one hundred-twenty countries to date.
SquareTrade deals with “disputes involving non-delivery of
goods or services, misrepresentation, improper selling practices, un-
honored guarantees or warranties, unsatisfactory services, credit and
billing problems, unfulfilled contracts, etc.”
These disputes typi-
cally arise out of discrete contractual transactions, i.e., transactions
that are short-lived and terminate upon the performance of clearly
defined and planned obligations.
In such exchanges, there is little
interdependence between parties, risks and benefits are sharply di-
vided, and parties’ relationships involve limited aspects of their per-
Since parties to discrete transactions typically have
little long-term stake in the transactions (such as reputation or an
ongoing relationship with their counterpart), they usually focus on
uncovering the source of the problem and identifying conditions
under which the agreement can either be completed or revoked
10. About SquareTrade, http://www.squaretrade.com (follow “About Us” hyper-
link) (last visited Apr. 5, 2005).
11. SquareTrade does not handle disputes between users and eBay, only between
sellers and buyers on eBay.
13. What Types of Disputes Does SquareTrade Handle?, http://www-stage.square
trade&cntid=2kv0enfn32&sapid=2am5w9pch1&cate=1&ques=7 (last visited Jan. 9,
Ian R. Macneil,
Economic Analysis of Contractual Relations: Its
Shortfalls and the Need for a “Rich Classificatory Apparatus”
, 75 N
. U. L. R
. at 1031–36.
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Harvard Negotiation Law Review
rather than on seeking a creative resolution. This is even more pro-
nounced when they are transacting globally and the amounts in dis-
pute are small. However, in the eBay-SquareTrade case, some of the
characteristics of discrete transactions are blunted by a variety of
tools that create long-term stakes for eBay users—tools that trans-
form users from mere one-time buyers and sellers to members of a
The first stage of SquareTrade’s dispute resolution system con-
sists of an automated negotiation platform, offered to eBay members
free of charge. A party initiates the automated process by filling out
an online complaint form.
The complainant can choose from one of
several descriptions of the type of problem she is facing and/or fill out
an open-space box with a description of a problem that is not cap-
tured by the pull-down menu options. In addition, the complainant is
asked to select one or more solutions to which she would be amena-
ble. Again, there is both a pull-down menu and an open-text box.
The system then e-mails the other party, providing basic information
regarding the complaint and SquareTrade’s ODR services. The re-
spondent is invited to pick a solution by choosing one of several op-
tions presented on the response form or by suggesting an alternative.
The product, thus, is a technological hybrid of negotiation and media-
tion. Technology intervenes in the negotiations between the parties
and, by allowing parties to formulate and reformulate the problem
and the solution, performs some of what would be associated with a
mediator’s role, moving the parties from a problem mode to a solution
The automated negotiation process has proven highly suc-
cessful, resolving eighty percent of the disputes it has processed.
In the second stage, those disputes not resolved through auto-
mated negotiation are referred to online mediation, a process in
which an in-person mediator attempts to resolve the dispute through
asynchronous e-mail communications with the parties. SquareTrade
employs some two hundred mediators
from over fifteen countries in
notes 2–3 and accompanying text.
17. SquareTrade Dispute Resolution Overview, http://www.squaretrade.com/cnt/
cntid=9dv3rzgq32 (last visited Apr. 5, 2005).
18. Interview with Nate Lipscomb, former Project Manager and Mediator,
SquareTrade, in N.Y., N.Y. (Jan. 27, 2004).
Web Forum Will Weigh Nasty Property Debates
(July 8, 2002), http://www.realestatejournal.com/buy
20. SquareTrade Mediators, http://www.squaretrade.com/cnt/jsp/med/mediators.
(last visited June 19, 2005).
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The mediation service is offered by SquareTrade
for a nominal sum of approximately thirty dollars to eBay users.
Because SquareTrade mediations can be conducted from anywhere in
the world at the convenience of the parties and the mediators, they
are able to accommodate time difference and conflicting work sched-
ules, making settlement more likely. The mediator does much of
what a mediator would do offline—manage the process, uncover par-
ties’ underlying interests, and lead the parties toward a mutually ac-
ceptable resolution. However, an online mediator relies on written
communications that are conducted with each party separately, while
traditional mediators meet face-to-face with both parties usually pre-
sent. SquareTrade’s mediation services, like the automated negotia-
tion process, also have been a success in terms of settlement rates.
In addition to its ODR services, SquareTrade offers “Seal Mem-
bership” to eBay users.
The seal, to an even greater extent than
SquareTrade’s dispute resolution services, is a distinctive eBay ser-
vice. Under this system, SquareTrade verifies the identity and ad-
dress of eBay sellers, who, in return, commit to a specified set of
selling standards and pay a low fee to SquareTrade. Among other
things, seal members pledge to participate in SquareTrade’s ODR
system should a dispute arise between them and an eBay buyer and
to make a good faith effort to resolve such disputes.
The seal is an
icon that is displayed by the seller’s ID on eBay but remains under
the complete control of SquareTrade. SquareTrade can follow trends
on buyer activities and habits since these patterns are recorded when
buyers click on the seal. Also, SquareTrade can remove the seal icon
at any time should a seller no longer meet the requirements.
21. Interview with Cara Cherry-Lisco, Vice-President, Dispute Resolution Ser-
vices, SquareTrade, in L.A., Cal. (Nov. 21, 2003).
22. EBay Mediation Fees, http://www.squaretrade.com/odrsvcs/odr_pricing.jsp
(last visited Jan. 9, 2006).
23. SquareTrade Cases, http://flavious28.tripod.com/square.htm (last visited
June 30, 2005).
24. Recently, SquareTrade has introduced a third function called the Square-
Trade SideBar, which I do not address in this Article. SquareTrade SideBar, http://
sidebar.squaretrade.com (last visited Jan. 9, 2005).
25. SquareTrade Help, Membership Features, http://www.squaretrade.com/cnt/
536t31&cntid=40ni9d6sz1&cate=2&ques=5 (last visited Dec. 7, 2005).
26. Interview with Cara Cherry-Lisco,
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Harvard Negotiation Law Review
presumably enhances a buyer’s trust in a seller. Indeed, the seal pro-
gram has succeeded in drawing many eBay sellers, with the seal cur-
rently appearing on over five hundred thousand eBay listings at any
The chief characteristics of the SquareTrade conflict resolution
system will be fully explored below. However, even this short
description of SquareTrade’s modus operandi (the gathering and re-
cording of information in particular) suffices to suggest the prospect
of fresh insights into one of traditional mediation’s most important
The Accountability Dilemma in Mediation
Accountability constitutes an obligation to explain how an as-
signed mandate has been discharged.
It implies both answerability
to an authority and the prospect of consequences in the event of a
breach of a duty or obligation under such mandate.
accountability measures aim to ensure that decision-makers exert
power in a fair and effective manner. Accountability mechanisms
typically fall into one of two categories: (1) enhanced structure for
decision-makers, which limits their authority and discretion ex ante
through guidelines and standards, yielding more consistent decision-
making across cases, and (2) transparency with respect to the actions
of decision-makers and the outcomes of their decisions, thereby per-
mitting ex post monitoring in light of the established guidelines,
which, in turn, serve as criteria for evaluation.
27. SquareTrade Help, Seal Program Overview, http://www.squaretrade.com/cnt/
9p2ye6xd1&cntid=QTy59r6r41&memid=HVdlbn6xa1&cate=0&ques=6 (last visited
Dec. 7, 2005).
Panel on Accountability and Governance in the Voluntary Sec-
tor, Final Report,
Building on Strength: Improving Governance and Accountability in
Canada’s Voluntary Sector
(Feb. 1999), http://www.vsr-trsb.net/pagvs/Book.pdf.
Public and Private Partnerships: Accounting for the New
, 116 H
. L. R
. 1229, 1260 (2003) (“Accountability . . . means being an-
swerable to authority that can mandate desirable conduct and sanction conduct that
breaches identified obligations.”).
Michael C. Dorf & Charles F. Sabel,
Drug Treatment Courts and Emer-
gent Experimentalist Government
, 53 V
. L. R
. 831, 837 (2000) (“Detailed stat-
utes or regulations provide a reliable yardstick against which to measure
implementation so as to establish the accountability of agency officials.”).
The Importance and Attributes of Effective Accountability Relation-
, 12 A
. 60, 68 (2000) (stating that “[t]ypically, accounta-
bility processes include: assigning responsibilities; agreeing on goals; establishing
performance criteria and standards; controlling and monitoring; rendering accounts
on and reviewing results; judging; answering and explaining; rewarding, sanctioning,
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Accountability can be generated through formal mechanisms—
those that are derived from a legal source (superimposed fixed rules,
regulations or procedures that restrict authority or mandate informa-
and/or through informal mechanisms—by relying
on professionalism or market forces to curb decision-maker discretion
and encourage voluntary information disclosure on actions and re-
Accountability can be internal, external, or both. Internal ac-
countability typically promotes self-evaluation and organizational de-
velopment and enhances management practices and strategic
planning through internal measures and review,
while external ac-
countability usually involves evaluation of performance and out-
comes by a credible external entity (private or public) in the context
of predetermined boundaries.
Since mediation is voluntary and any resolution reached must be
acceptable to all parties, it is tempting to dismiss the need for vigor-
ous accountability measures.
However, mediators, despite lacking
formal decision-making authority, nonetheless exert power by affect-
ing parties’ perceptions of a dispute, setting the agenda, exploring
mentoring; and so on,” all of which seem to fall under the two rubrics of rules and
procedures on the one hand and transparency on the other).
Susan P. Sturm,
Second Generation Discrimination: A Structural Ap-
, 101 C
. L. R
. 458, 475 (1998) (describing the rule enforcement ap-
proach as a “fixed code of specific rules or commands that establishes clear boundaries
When Dispute Resolution Begets Disputes of Its
Own: Conflicts Among Dispute Professionals
, 44 UCLA L. R
. 1871, 1991 (1997)
(“ADR professionals seek to regulate themselves through a wide variety of internal
and professional association standards and protocols.”).
Panel on Accountability,
34. Since under my definition of formal accountability the entity involved can be
either public or private, a requirement for external accountability does not necessarily
call for the regulation of the field, a requirement which could impose prohibitive
costs—financially and to the nature of the process. The regulation and institutional-
ization of mediation has been the subject of vigorous debate. For a discussion of some
of the major issues relating to ADR’s institutionalization, see generally Carrie
Pursuing Settlement in an Adversary Culture: A Tale of Innovation
Co-opted or “The Law of ADR”
, 19 F
. U. L. R
. 1 (1991).
Joseph B. Stulberg,
, 38 F
. & C
. 77, 78 (2000); Deborah R. Hensler
, Our Courts, Ourselves: How the Alternative
Dispute Resolution Movement is Re-shaping Our Legal System
, 108 P
. L. R
165, 188 (2003) (“[L]egislatures and courts do not feel that they need to regulate medi-
ations or mediators closely.”). In this context, the discussion of NGOs’ informal power
and therefore of the need for NGO accountability is instructive.
Spar & James Dail,
Of Measurement and Mission: Accounting for Performance in
, 3 C
. J. I
L. 171 (2002); Paul Wapner,
ing Accountability in NGOs
, 3 C
. J. I
L. 197 (2002).
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Harvard Negotiation Law Review
possible outcomes, and drafting the precise wording of an agreement.
Many of these interventions are appropriate and helpful, but at times
a mediator’s influence can be harmful, unfair, or ineffectual.
propriate interventions could relate to the manner in which
mediators run the process (applying pressure on a party to continue
negotiating under adverse conditions or running the process ineffec-
tually by failing to schedule appointments) or handle the resolution
phase (exerting improper pressure on a party to agree to a settlement
offer or condoning an incomplete agreement). Aside from the poten-
tial for mediator abuse, the mediation process, by nature, eludes pat-
tern or consistency. Because mediation is conducted on a case-by-
case basis, there is the danger that similar disputes will be handled
differently or that errors will go unrecognized. This runs against the
natural expectation that analogous grievances will be handled simi-
larly. In as much as pattern and consistency are conducive to both
efficiency and fairness, their absence raises concern in these contexts.
To that end, professional mediators must be held accountable to
parties, providers that rely on their services, relevant regulatory au-
thorities, and the general public for the delivery of procedurally fair
mediation services that meet accepted standards of mediator per-
formance and that lead to resolutions that are voluntary and entered
into on the basis of informed consent.
A breach of these obligations
should result in legal, disciplinary, monetary, or reputational conse-
Similarly, mediation providers should be held accounta-
ble to disputants, dispute referral sources, and funders for the quality
of mediation services rendered by mediators employed by them.
Providers also must be held accountable for their own policies and
practices being fair
and for permitting quality control. If providers
, 83 B.U. L. R
. 147, 149–51 (2003);
Sara Cobb & Janet Rifkin,
Practice and Paradox: Deconstructing Neutrality in Media-
, 16 L
35, 60 (1991).
Joseph B. Stulberg,
The Theory and Practice of Mediation: A Reply To
, 6 V
. L. R
. 85, 86, 96 (1981).
Environmental Mediation and the Accountability
, 6 V
. L. R
. 1, 4 (1981) (implying that mediators who fail to meet their
obligations should be held accountable, i.e., someone should “chastise, sue or fire”
39. A policy that permits parties to choose a particular mediator may seem fair
since it is applied consistently to all disputants, but in practice could provide repeat
disputants such as corporations with an advantage over their counterparts who are
one-time users of the system and have no preference with respect to choice of a neu-
Do the “Haves” Come out Ahead in Alter-
native Judicial Systems?: Repeat Players in ADR
, 15 O
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do not meet these standards, they should be denied funding and fu-
Thus, accountability in the mediation context requires that stan-
dards for appropriate and fair mediator practice be established and
that sufficient information be collected and analyzed to verify
whether such criteria are being met. These responsibilities have
been translated by mediators into internal accountability measures
(such as devising standards and codes of conduct and instituting
training programs that set standards for mediator conduct) or, as in
the case of regulated mediation services, into a combination of inter-
nal and external accountability measures (such as auditing providers’
data on their caseloads, requiring that providers institute training
programs, and sitting in on random mediation sessions) that strive to
ensure procedural fairness, effectiveness, and informed consent by
In practice, two of mediation’s core features—confidentiality and
flexibility—have stood in the way of establishing effective formal and
informal accountability mechanisms for mediators and providers.
Confidentiality in mediation typically extends to all communications
made during mediation proceedings and applies to all those present
in mediation sessions; it involves both secrecy
and external ano-
The Uniform Mediation Act provides that mediation com-
munications are confidential to the extent agreed by the parties
provided by other laws
and assures parties’ expectations regarding
confidentiality protections in subsequent legal proceedings through a
mediation privilege for mediation communications
40. Secrecy means that the information exchanged remains confidential. Orna
Going Public: Diminishing Privacy in Dispute Resolution in the In-
, 7 V
. J.L. & T
. 4, at *13 n.12 (2002) (citing Eben Moglen’s distinction
among secrecy, anonymity, and control of information, all three of which are elements
of informational privacy).
41. External anonymity means that outsiders to the dispute are typically kept in
the dark, not only with respect to the particulars of the dispute but also with regard to
the identity of the disputing parties.
at *18, *67. In court-annexed mediation,
the existence of the dispute and therefore the identity of the parties as well as a reso-
lution, if one is reached, are made public.
42. Parties typically sign a confidentiality agreement upon entering a mediation.
§ 8 (2001),
44. A mediation communication is defined in the Act as a statement (whether
oral or in a record, or verbal or nonverbal) that occurs during a mediation or is made
for purposes of considering, conducting, participating in, initiating, continuing, or re-
convening a mediation or retaining a mediator. The protected communications do not
include any underlying evidence, only statements made with respect to such pieces of
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parties and the mediator.
The requirement for confidentiality has
been translated into a set of practices that have substantially re-
stricted the scope of information collected and the occasions on which
it can be gathered by mediators and mediation service providers.
Thus, information is collected only with respect to limited criteria
(such as the type of dispute, whether it was resolved or not, etc.) and
is gathered mostly after the fact rather than simultaneously with the
Under these circumstances, analysis and sharing of in-
formation collected are obviously limited. Mediated resolutions, as
opposed to the proceedings themselves, can be confidential or not, de-
pending on the parties’ agreement. However, even when the resolu-
tions are not sealed, there are typically no mechanisms for their
aggregation and publication and, therefore, they tend to remain un-
known to those external to the dispute.
Flexibility, also an essential feature of mediation, allows the me-
diator to handle a wide assortment of disputes with varying circum-
stances and diverse disputant needs and interests. Although a
mediator may follow a general procedural framework and observe
minimal substantive limits, she is free to devise the process as she
and the parties see fit. Hence, the mediator plays a very different
role than a judge or an arbitrator, even though all are neutral third
parties facilitating communication between disputants, because the
mediator operates in the context of a consensual process and is not a
In this environment, parties enjoy lax procedures
and have the power to shape substantive resolutions, opening up pos-
sibilities that extend far beyond those provided by formal law.
evidence, and no “fruit of the poisonous tree” doctrine applies to the mediation privi-
46. Typically mediators fill out rather sparse forms that list the dispute type
(e.g., contractual, custody), the relationship between the parties (e.g., neighbors, land-
lord-tenant), and the ultimate outcome. This form does not capture the dynamics of
the mediation, the mediator’s interventions and their impact on the mediation pro-
ceedings, or how these interventions did or did not impact the resolution of the dis-
pute. Capturing this type of information would require either a simultaneous
recording of the proceedings, which is rarely done, or having an observer present
whose role is to document such dynamics, also a rare practice. Party complaints and
party satisfaction surveys, both of which are dependant on party initiative and are
relayed after the mediation has taken place, can be additional sources of information.
note 143, describing current information gathering practices at Safe Hori-
zon, a leading mediation center in New York that mediates court-referred cases and
, prefatory note (2001).
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It is not surprising that broad confidentiality protections and
procedural and substantive flexibility have become essential compo-
nents of the mediation practice. Confidentiality creates a safe haven
for disputants, allowing them to bring forth disputes that they may
not have been willing to pursue through formal, public avenues
encouraging disputants, once the mediation has begun, to participate
wholeheartedly and abandon strategic conduct that is driven by a
fear of subsequent litigation.
Confidentiality protections are the re-
sult of a concern that the disclosure of mediation communications in
subsequent adjudicatory proceedings would not only diminish par-
ties’ candor, but would also reduce the general public’s trust in the
process and deter future disputants from using it.
Mediation’s flexibility has not only lowered costs for disputants
in comparison to litigation,
but has also answered disputants’ emo-
tional needs in providing them an avenue for dispute resolution that
does not rely on lawyers or legalese, which has often labeled litigants
as victims and alienated them from their own stories.
procedural flexibility allows parties to tell their stories freely, in an
uninterrupted manner, while its substantive freedom permits parties
to decide whether and how to resolve their dispute, resulting in sub-
stantial party control over the dispute and its resolution.
ibility makes mediated resolutions more satisfying
Mary P. Rowe,
People Who Feel Harassed Need a Complaint System with
Both Formal and Informal Options
. J. 161, 165–66 (1990).
, prefatory note (2001).
Carol A. Wittenberg et al.,
Why Employment Disputes Mediation Is on the
, 578 PLI/L
747, 750–51 (1998).
109 (1988) (describing how people who have received discriminatory
treatment resist legal recourse because they fear being portrayed as victims within
Tom R. Tyler,
Citizen Discontent With Legal Procedures: A Social Science
Perspective on Civil Procedure Reform
, 45 A
. J. C
. L. 871, 888 (1997); John M.
Conley & William M. O’Barr,
Litigant Satisfaction Versus Legal Advocacy in Small
Claims Court Narratives
, 19 L
. 661, 662, 665–72, 684–90 (1985).
54. The spectrum of resolutions reached in mediation is substantially broader
than that offered through litigation, allowing parties to agree on remedies that are
not available by law (an apology, an agreement to treat one another with respect) and
devise win-win solutions (that allow, for example, for ongoing cooperation) as opposed
to the “all or nothing” character of a judicial decision.
note 34, at 7.
55. Some studies indicate that parties are more likely to fulfill their commit-
ments when they have devised the resolution themselves.
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Despite their appeal, confidentiality and flexibility have come at
a cost in terms of accountability. One challenge for the field has been
how to follow and analyze mediator performance without jeopardiz-
ing confidentiality or incurring unreasonable expenses. Confidential-
ity and the related practices regarding information collection and
sharing on mediation proceedings preclude the inexpensive options of
holding open proceedings or having a record made. At the same time,
in order to evaluate the proceedings and mediator conduct, a method
of tracking the course of the mediation in addition to “bottom lines” is
essential. The outcome is rarely a sufficient tool for evaluating the
quality of mediator performance. Aside from extreme cases in which
the outcome clearly reflects a mediator’s poor performance (for exam-
ple, if the agreement contains an illegal element or contradicts a me-
diation provider’s policy against mediating in cases of domestic
violence), it is difficult to evaluate the outcome of a process that is
driven by party satisfaction and allows for trade-offs between legal
remedies and such outcomes as apologies. It is even more difficult to
establish a causal link between a voluntary outcome and the media-
tor’s subtle interventions that might have indirectly driven such a
Another problem is that confidentiality of proceedings and flexi-
bility impede learning from case to case in a manner that could im-
prove mediator practices and provider policies. The erasing of
“memory” with respect to mediation proceedings encourages a case-
by-case approach, in which everything is done de novo, and experi-
ence is rarely used for future training or revision of practices. For
mediation providers, the prevailing information collection practices
prevent in-depth analysis of individual cases or examination across
cases that would highlight patterns of either positive or troubling
For external bodies that might assess mediator behavior or
E. A. S
ANDER ET AL
56. With respect to troubling patterns, see N
67 (Laura Nader ed., 1980) (“Confidentiality of com-
plaints, in a market where it is impossible for the consumer to be adequately informed
through word of mouth, prevents consumers from being able to learn from the experi-
ence of others.”); Sturm,
note 31, at 468–69; N
: A G
As for positive trends, SquareTrade has also drawn on mediation records to identify
exceptionally skillful mediators. SquareTrade has also, on occasion, requested that
successful mediators contribute to its training materials. Interview with Cara
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punish sub-par performance—in other words, ensure accountabil-
ity—the “erasure” of past mediation proceedings, along with the lack
of enforceable standards, represents a crippling encumbrance.
The accountability measures that have emerged in the context of
publicly funded community mediation centers and providers that
handle court-referred disputes reflect these difficulties. Such provid-
ers and mechanisms are subject to external accountability through
formal and informal measures, such as training and certification re-
quirements, evaluation of mediation services by funders and referral
sources, mediator liability, and reputation. However, these measures
have been largely ineffective because they have been implemented in
a confidential and flexible setting that has permitted only the collec-
tion of limited, after-the-fact information, thereby eschewing consis-
tency, improvement, and learning from one dispute to another.
Under these conditions, there have been few incentives for mediators
and providers to deliver high-quality services or to improve them over
Even these limited formal measures are absent from the private
arena, where mediators and providers are subject only to informal
market accountability mechanisms. Interventions by such mediators
often occur on a one-time basis, and there are insufficient “moral, le-
gal and economic pressures”
to ensure their accountability.
Examples of the deficiencies of existing accountability measures
in the mediation field are abundant. For instance, evaluations of me-
diation services—both internally (by providers) and externally (by
funders)—typically revolve around the partial data that is available,
namely resolution rates and party satisfaction surveys, both of which
are of limited use in evaluating mediator performance. Parties, for a
variety of reasons, can be poor evaluators of mediator performance,
and resolution rates do not necessarily reflect high-quality mediation
services. To the contrary, in certain cases, it is actually preferable
and fairer that an agreement not be reached.
note 38, at 5–6 (claiming that in the case of environmen-
tal mediators, as opposed to labor mediators, there are often insufficient pressures to
ensure their accountability given the one-time nature of their interventions).
58. Parties are typically emotionally involved and are rarely familiar with the
goals of the processes, which themselves differ across the field, and tend to be satis-
fied with processes that allow them more procedural freedom—such as mediation.
59. For example, disputes in which the parties are of unequal bargaining power
and any agreement reached will recreate such power distribution. In those cases in
which power differences between the parties cannot be balanced, it may be preferable
not to reach a mediated resolution.
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Nor have lawsuits been an effective tool for guiding mediator
conduct. In many states, mediators enjoy immunity from lawsuits,
but even in those cases in which they do not, proving such cases is an
arduous task. In light of extensive confidentiality protections that
prohibit real time information collection, it is practically impossible
for a party to substantiate a claim against her mediator because of
the difficulty in proving (1) that the mediator acted inappropriately
in the particular instance, and (2) that such mediator’s behavior devi-
ated from the acceptable standard of appropriate mediator conduct.
Similarly, the effort to generate accountability through profes-
sional tools, such as educational prerequisites for mediators, training
programs, and ongoing certification requirements, has been weak.
Because mediation providers have failed to systematically evaluate
their mediators and because their efforts typically lack formal, con-
sistently applied decertification and complaint procedures with re-
spect to mediators, these tools often fail to motivate mediators to
Finally, where there are no clear criteria for the evaluation of
mediator conduct and almost no transparency with respect to media-
tor practices, there is little reason to believe that an informal reputa-
tion market would be effective. Indeed, in practice, the fact that a
mediator has a heavy caseload, or that her services are consistently
sought by a reputable provider, is rarely indicative of the quality of
her practice and may have more to do with her availability, or rela-
tions with a mediation center’s staff, than with her performance.
Against this backdrop, the SquareTrade experience could offer
the basis for an alternative to the prevailing framework for accounta-
bility in the traditional mediation world that relies on formal and/
or informal accountability mechanisms—that of structural
Rethinking Accountability: Features of the SquareTrade System
Generating Structural Accountability
In the following Parts, I will analyze the features of the Square-
Trade system that enable it to reconcile confidentiality and flexibility
Scott H. Hughes,
Mediator Immunity: The Misguided and Inequitable
Shifting of Risk
, 83 O
. L. R
. 107, 111 (2004) (asserting that the reasoning behind
mediator immunity in statutes and case law is “unsound and the results are
note 36, at 172–73.
note 144 and accompanying text.
note 31, at 463.
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on the one hand with accountability on the other by collecting simul-
taneous information on ODR proceedings, designating caretakers of
information, adopting a more nuanced view of confidentiality, imple-
menting consistency-enhancing structures, working from an embed-
ded position within eBay, and internalizing incentives.
The system of accountability produced by SquareTrade through
these features, as demonstrated in more detail in the sections that
follow, can be seen as an illustration, albeit incomplete, of structural
accountability at work. Structural accountability is the term used to
describe a system that produces accountability through bottom-up ef-
forts. It is generated through internal structures that encourage
broad information collection and analysis. It can curb discretion, pro-
mote consistency, allow for monitoring, and create incentives for
high-quality performance. It is thus distinguishable from both the
imposition of rigid, predetermined rules (formal measures) and the
vague nature of reputational stakes (informal mechanisms) and so
can be effective in confidential and flexible settings.
Effective structural accountability incorporates both internal
and external elements. Internally, goals are defined and targets are
set, processes for measuring and monitoring performance are insti-
tuted, and improvement is sought. Externally, beyond setting the
general framework, particular goals and performance evaluation are
audited and questioned in an additional effort to detect and remedy
poor performance, misconduct, inefficiencies, and deficient policies.
The SquareTrade system lacks an element of external accountability
and, as such, can be characterized as a case of incomplete structural
Elements of Structural Accountability in the SquareTrade
Collecting Simultaneous Information
An essential component in SquareTrade’s accountability system
is its substantial database on resolution efforts. Such a database is
unparalleled in traditional mediation, mostly because of the manner
in which confidentiality has been interpreted in the offline arena.
note 31, at 463
notes 123–24 and accompanying text for an explanation of the in-
complete nature of the SquareTrade system.
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SquareTrade, as will be explained in more detail in the following sec-
tions, has managed to gather extensive information internally with-
out completely foregoing confidentiality externally.
Below is a
description of the types of information SquareTrade collects and an
assessment of the reliability and significance of such information to
SquareTrade’s quality control efforts.
SquareTrade collects a vast amount of information on the ser-
vices it provides, much of which is gathered in real time, simultane-
ously with the act of participation in the ODR process. The
information is gathered and remains accessible to SquareTrade, the
mediator, and the parties for up to one year.
Because ODR is con-
ducted through written digital communications, the act of participa-
tion in ODR results in the automatic preservation of all
communications exchanged during the process. For example, when
two parties negotiate with one another through the automated nego-
tiation tool, all of their discussions and any resolution reached are
documented. The same applies to parties who mediate their dispute
through the service.
In addition to dispute resolution data, SquareTrade collects all
other correspondence exchanged between disputants and Square-
Trade, information that is publicly available on eBay, and informa-
tion disclosed in seal applications (including each applicant’s name,
e-mail address, market ID number, sales revenue, credit card num-
ber, social security number, and business references) and in the user
registration form (including such details as name, e-mail address,
and market ID number).
At the conclusion of the dispute resolution process, SquareTrade
records “Resolution Behavior Information,” which is comprised of in-
formation on whether a party participated in the process to comple-
tion, whether an agreement was reached, whether the party accepted
or rejected a mediator’s recommendation, and, with respect to a re-
spondent, whether the person had been involved in multiple cases of
Part I.C.2.c (“Adopting a Nuanced View of Confidentiality”).
67. E-mail from Cara Cherry-Lisco, Vice-President, Dispute Resolution Services,
SquareTrade, to author (Apr. 4, 2005, 17:41:32 EST) (on file with author) (stating that
generally, SquareTrade does not maintain case records which are more than one year
conf_agree.jsp?vhostid=chipotle&stmp=squaretrade#conf_infocollect (follow “Infor-
mation We Get” hyperlink) (last visited Apr. 5, 2005).
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Additionally, SquareTrade tracks and analyzes “user site us-
(e.g., users’ behavior—how they navigate, whether they tend
to drop out on certain pages) so as to improve the content and design
of the site and customize SquareTrade’s services. All information
gathered is stored in a secure database.
Thus, SquareTrade’s information base is significantly richer and
more credible than that of traditional mediation providers and
Offline, mediation providers generally collect informa-
tion at the end of the mediation process. This method of gathering
information is problematic for two reasons. First, parties’ and
mediators’ ex post recollections of the proceedings can be unreliable
and deficient as a source for assessing mediation dynamics, particu-
larly when dealing with emotional disputants. Second, psychological
dynamics affect disputants’ impressions of the process. Research has
shown that disputants tend to be satisfied with proceedings that are
flexible and allow them more voice and control (such as mediation),
even if the outcome is to their detriment.
For this reason, parties
may be content with the mediation process even in those cases where
an external examination of the proceedings would detect improper
mediator conduct or unfair procedures.
Many parties do not know
enough about the mediation process and the standards of conduct for
mediators to evaluate, as party satisfaction surveys sometimes re-
quest them to, whether the mediator’s performance was appropri-
In addition, user satisfaction surveys and disputant
complaints, one of the channels for information gathering in tradi-
tional mediation, are dependent on disputant initiative. Individuals
who have a low probability of becoming repeat users of these services
have little incentive to devote their time to filling out these forms. In
contrast, real time information is broad enough to allow judgment of
mediator interventions in the context in which they were made, and
. (follow “Security” hyperlink) (last visited Apr. 5, 2005).
72. Interview with Nate Lipscomb, former Project Manager and Mediator,
SquareTrade, in N.Y., N.Y. (Nov. 4, 2003) (stating that parties and mediators can
examine the “shared history, shared memory” of their dispute).
Conley & O’Barr,
note 53; Tyler,
Jacqueline M. Nolan-Haley,
Court Mediation and the Search for Justice
, 74 W
. U. L.Q. 47, 69–71 (1996).
75. For example, one survey distributed by Safe Horizon asks parties whether
the mediator explained the process clearly, took sides, or pushed the party into enter-
ing the agreement (Mediation Client Survey, Safe Horizon (on file with author)). In
egregious cases parties could detect such conduct, but in many instances these acts of
misconduct are subtle moves, indiscernible to disputants (survey on file with author).
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it is reliable enough so as not to be shaped by memory lapses, emo-
tional condition, or knowledge deficiencies.
Designating Caretakers of Information
The mere collection of information does not ensure accountabil-
ity. It is the analysis of the information that allows mediation provid-
ers to detect problems, such as the incompetence of a particular
mediator, major differences in the types of resolutions reached across
similar cases, or inefficiencies. However, the analysis need not be
limited to uncovering problems; it can also highlight effective ways of
addressing deficiencies and bring to light successes. In Square-
Trade’s case, ongoing analyses of information, and a commitment to
act on it, have enabled the company to improve its services and train-
ing program. From its inception, SquareTrade has employed a full-
time employee devoted to data analysis,
and a regular part of the
dispute resolution team’s work has involved producing internal re-
ports that are based on collected data. As the Vice President of Dis-
pute Resolution at SquareTrade states: “[W]e’ve always looked at
data at regular steps to analyze and figure out how to improve the
product, so regular reporting has always been a feature of Square-
Trade internal operations. Reporting on volume . . . reporting on the
settlement rates, reporting on the utilization of mediators, reporting
on the quality of mediators’ work.”
Having caretakers of information has helped SquareTrade im-
prove its mediation services as well as the design of its website and
product. SquareTrade can study information per mediator
so as to
detect patterns and to discern good from bad mediators and effective
from unsuccessful interventions and techniques. New mediators al-
ways receive supervision and instruction during their first few medi-
ations, which are closely monitored.
In the case of more
experienced mediators, records are accessed if reports indicate that
there might be a problem with a particular mediator or if complaints
76. Telephone Interview with Cara Cherry-Lisco, Vice President, Dispute Resolu-
tion Services, SquareTrade (Oct. 23, 2003).
78. Interview with Nate Lipscomb,
79. Interview with Cara Cherry-Lisco,
note 21 (describing SquareTrade’s
supervision practices over new mediators, under which such mediators “[will] get an
initial batch of five cases and either our head mediator or we’ve had other trainers in
the past will supervise those cases and check in on them daily and write messages to
the mediators saying ‘you missed this’ or ‘what about this’ or ‘what about the lan-
guage that you chose’ and then they’ll answer questions. Very hands on, very closely
supervised and at the end of that or during that we will identify whether we’re com-
fortable with this person handling cases or we feel like they will pick it up”).
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are received from consumers.
In addition, automatic processes flag
certain cases to SquareTrade’s attention as part of its efforts to en-
sure adequate mediator performance.
SquareTrade’s caretakers of information discovered that its
users experienced informational deficiencies regarding the nature of
the mediation process (for example, expecting mediators to render a
binding decision) as well as with respect to the technical aspects of
the SquareTrade system (such as the procedure for having a media-
tor assigned to their case).
Typically, SquareTrade learned of these
issues through its mediators, who had to deal with such misunder-
standings repeatedly, or through direct communication from its
Also, by following user site usage, SquareTrade became
aware that some of the site’s content was unclear or complicated and
caused users to drop off.
SquareTrade addressed these problems by
clarifying content on its own website as well as by providing informa-
tion and instruction on the eBay site.
One of the most interesting examples of SquareTrade’s learning
process involves the refinement of its automated negotiation device.
Initially, SquareTrade expected most of its disputes to be standard
consumer-vendor disagreements of the kind seen in brick-and-mortar
stores, and prefixed options in its automated process reflected this
expectation. However, SquareTrade soon realized through its analy-
sis of user input in its site’s free-text boxes,
that it had completely
missed one of the most frequent dispute types—feedback rating dis-
putes. It was the information supplied by users that signaled to
SquareTrade that a new case type existed and needed to be identified
in the automated process options.
This is a good illustration of
SquareTrade’s ability to learn, through its institutionalized processes
and designated caretakers for information analysis, how to improve
its product and deliver better services to its users.
80. Interview with Cara Cherry-Lisco,
81. Telephone Interview with Cara Cherry-Lisco, Vice-President, Dispute Reso-
lution Services, SquareTrade (Sept. 25, 2003).
82. Interview with Nate Lipscomb,
note 72. Telephone Interview with
Cara Cherry-Lisco, Vice-President, Dispute Resolution Services, SquareTrade (Oct.
83. Interview with Nate Lipscomb,
86. As mentioned above, complainants and respondents filling out the online
forms that constitute the automated negotiation process can either choose one of the
prefixed options for problem and solution types or fill out an open-text box.
note 17 and accompanying text.
87. Interview with Cara Cherry-Lisco,
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Adopting a Nuanced View of Confidentiality
In the traditional mediation world, confidentiality has been
broadly interpreted. Confidentiality has been understood to cover all
mediation communications. Applying to all those present, it prevents
mediation providers from collecting information even for internal
purposes and bans information sharing by providers with respect to
the content of mediation proceedings, except for such aggregate sta-
tistics as number of cases handled and resolution rates—hardly satis-
factory indicators of the quality of the services rendered.
SquareTrade’s approach reflects a more nuanced view of confi-
dentiality, one that distinguishes between internal and external se-
crecy and, with respect to external secrecy, further distinguishes
among the various participants in their freedom to disclose informa-
tion. This approach has led to broad internal information collection,
allowing caretakers to analyze that information as described
certain information with external individuals, entities, and the gen-
For example, SquareTrade may disclose dispute resolu-
tion and agreement information to a marketplace such as eBay for
enforcement purposes as well as aggregate information that is not
Furthermore, SquareTrade states in its
court or for criminal and fraud investigations.
SquareTrade views building trust in transactions as essential, it may
disclose to the public “Resolution Behavior Information” (but not the
content of a mediation or its resolution). To date, SquareTrade has
chosen to disclose very little information to the public, sharing only
notes 55–56 and accompanying text.
conf_agree.jsp;jsessionid=9dv3rzgq32?vhostid=chipotle#conf_disclosure (follow “Our
Use and Disclosure of Your Information” hyperlink) (last visited Apr. 5, 2005). It is
difficult to compare SquareTrade’s information collection and sharing practices with
those of other ODR sites policies because privacy policies and approaches to confiden-
tiality vary significantly.
Melissa Conley Tyler,
115 and Counting: The State of
, http://www.odr.info/unforum2004/ConleyTyler.htm (last visited Sept. 30,
2005) (“[M]ost ODR sites have explicit policies on privacy that tell users what use can
be made of their personal information. Some sites delete all information on a case
from their database once settlement has been reached (Bankers Repository Corpora-
tion) while others can store it in case of the disputant losing data (Intersettle).”).
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aggregate information—such as dispute volume and settlement
rates—relating to its dispute resolution services.
Several other characteristics of the SquareTrade system contrib-
ute to its fluid conception of confidentiality, resulting in more exter-
nal and internal sharing of information. Externally, SquareTrade
users, unlike parties in traditional mediation, are not restricted from
sharing dispute resolution information.
Even though parties in of-
fline mediation could breach their confidentiality obligation—or, if
they did not enter into an agreement, could share such information—
it seems that sharing written communications is more revealing than
recounting oral conversations. Also, there is potentially more inter-
nal information sharing between parties on the SquareTrade system
than offline. Since SquareTrade’s mediation communications are al-
ways conducted with one party at a time, there is no distinction be-
tween joint and private sessions as exists in traditional mediation.
SquareTrade mediators assume that a party’s communications can
be shared with the other side unless instructed otherwise.
a mediator generally checks in with a party at the end of a private
session to determine what information can be shared with the other
Perhaps it is not surprising that SquareTrade operates on more
relaxed notions of confidentiality. As stated above, the typical eBay
dispute concerns technicalities and does not produce tensions and
emotions that require a confidential setting for its resolution, as do,
for example, disputes involving trade secrets or sexual harassment.
Also, it seems fair to say that parties’ expectations for privacy when
operating online are lower than in a private mediation room, given
the nature of the respective media.
This phenomenon is enhanced
92. Interview with Cara Cherry-Lisco,
93. E-mail from Cara Cherry-Lisco, Vice-President, Dispute Resolution Services,
SquareTrade, to author (Nov. 4, 2004 15:28:56 EST) (on file with author).
95. Nevertheless, we can expect attitudes toward privacy to evolve and capabili-
ties for richer online communications to develop as technology advances. Such devel-
opments would broaden the scope of ODR disputes (
Part II.A). It is
important to note that ODR already handles various types of disputes that originated
offline (real estate, neighbors, family, employment).
About SquareTrade, http://
www.squaretrade.com (follow “About us” hyperlink; then follow “Partners” hyperlink)
(last visited Sept. 30, 2005); Tyler,
note 89. See
Part II.A for a discussion
of this potential limitation on the applicability of the SquareTrade example to a
broader range of dispute types and arenas.
96. Given the proliferation of the Internet and the frequent reporting of the unin-
tended spread of, and access to, e-mails and other information recorded online, users
have generally become more aware of the fact that these communications can never
be as protected as oral encounters.
Beth Givens, Privacy Expectations in a High
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by SquareTrade’s disclosure of its policies and practices on informa-
agreements, both of which are easily accessible on its site, are a pre-
condition for using its services, and are written in plain, clear lan-
guage. Finally, the low probability of these disputes ever reaching a
court—both because these are conflicts over small dollar amounts
and because they often span geographic borders, making them diffi-
cult and expensive to pursue through litigation—almost eliminates
the concern over the information on mediation proceedings being
made public in a future adjudicatory proceeding, a concern that has
driven much of the fear of information collection in the traditional
Implementing Consistency-Enhancing Structures
SquareTrade has introduced consistency to the practice of media-
tion through a variety of means that have included substituting some
mediator interventions with automated processes and equipping
mediators with a range of resolution templates. These means have
enhanced structure—an essential component of accountability—with
minimal cost to the process’s flexibility, a combination that has
seemed unworkable in the past.
SquareTrade’s automated process has increased consistency by
instituting an element of dynamic structure. The automated process
is engineered to substitute for some of the functions traditionally per-
formed by an in-person mediator through moving parties from a prob-
lem mode to a resolution-oriented one.
The preset options create a
predetermined structure, and decision-making points are made evi-
In addition, choices, both procedural (who gets to speak next,
Tech World, Opening Presentation at Santa Clara University Symposium on Internet
Privacy (Feb. 11–12, 2000), http://www.privacyrights.org/ar/expect.htm (last visited
Oct. 2, 2005) (describing how consumers avoided going online for “fear that massive
amounts of data will be collected about them”). At the same time, even if people know
or should know on some rational level that privacy is more vulnerable on the Internet
than in a private room, their cognitive biases may prevent them from acting consist-
ently with such knowledge by skipping over the fine print, clicking on the “I accept”
Ethan Katsh et al.,
E-Commerce, E-Disputes, and E-Dispute Resolution:
In the Shadow of “eBay Law”
, 15 O
. 705, 715 (describing how
the mediator—currently SquareTrade’s head mediator, Mark Eckstein—“had to
struggle to structure a relationship with the parties,” but nevertheless attempted to
“stop the cycle of blaming . . . paint these disputes, where appropriate, as not being
‘all or nothing’ propositions, [and] tried to keep all parties updated on the bulk of the
98. In mediation, “[p]arties generally do not know what mediation-related deci-
sions a mediator has made, and often they are not even aware that she has made any
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what action will be taken next) and substantive (how the issue is de-
fined, exploration of possible solutions), are fixed by SquareTrade,
though parties are allowed to deviate from the proposed substantive
options through free-text boxes, thereby preserving the process’s cre-
ative and tailored nature.
By limiting the procedural and substantive options available to
parties, SquareTrade creates a potentially more accountable mecha-
nism because it is applied consistently across cases. Importantly, the
automated process does not compromise flexibility. Despite introduc-
ing an element of structure, the automated process has remained dy-
namic through the existence of institutionalized channels for
information gathering and analysis, as evidenced by the refinement
of the automated process with respect to eBay feedback disputes de-
Another means for generating consistency in the resolution pro-
cess has been the creation of agreement templates that can be used
by mediators at the resolution stage.
The templates seem to be
particularly useful in the context of feedback removal disputes be-
cause, in those cases, it is preferable that feedback be removed only
after all other terms of the agreement have been complied with.
Since feedback—once removed through mediation—cannot be rein-
stated, SquareTrade mediators often structure the resolution of a
feedback case in a manner so as to enable parties to monitor whether
all preconditions have been fulfilled prior to having the feedback re-
moved by the mediator.
This way, if parties detect a problem prior
to the date on which the feedback is scheduled to be removed, they
can alert the mediator and resume the mediation. Even though tem-
plates introduce structure, the ability to tailor the template to the
specifics of a case ensures that flexibility is maintained and changes
can be made when necessary.
particular decision at all.” Michael Moffitt,
Casting Light on the Black Box of Media-
tion: Should Mediators Make Their Conduct More Transparent?
, 13 O
. 1, 1–2 (1997).
notes 86–87 and accompanying text.
100. Interview with Nate Lipscomb,
101. Interview with Nate Lipscomb,
102. Templates can obviously be used in the traditional mediation setting as well.
., Nancy Neveloff Dubler,
Mediating Disputes in Managed Care: Resolving
Conflicts Over Covered Issues
, 5 J. H
L. & P
479, 495 (2002). How-
ever, structure is only one aspect of accountability. Absent a correlating change in the
understanding of confidentiality, which has yet to take place in offline mediation,
providers would not be able to monitor whether such templates have been employed,
what their impact has been, whether templates should be revised, and under what
conditions deviations from templates should be condoned.
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Harvard Negotiation Law Review
The SquareTrade experience demonstrates that added structure
need not make the mediation process rigid. On the contrary, Square-
Trade’s procedures have preserved flexibility by maintaining the
ability to adapt to a variety of circumstances and needs.
Being Embedded in a Larger Transactional System
SquareTrade, despite having business relations with entities
other than eBay, both on- and offline, has primarily handled eBay
conflicts, and eBay has referred its users exclusively to SquareTrade
through a link on its website. Thus, SquareTrade’s position is practi-
cally that of an in-house dispute resolution provider that is embedded
in the fabric of the organization to which it provides its services, and
as such, offers some of the same possibilities but also raises similar
The phenomenon of embedded dispute resolution services is fa-
miliar from the traditional dispute resolution world where many fed-
eral agencies (such as the U.S. Postal Services)
and large private
103. The nationwide program offers transformative mediation services to USPS
employees for the resolution of employment disputes. For writing on the USPS inter-
nal dispute resolution program, see generally Cynthia J. Hallberlin,
Workplace Culture Through Mediation: Lessons Learned from Swimming Upstream
. & E
. L.J. 375 (2001); Tina Nabatchi & Lisa B. Bingham,
formative Mediation in the USPS REDRESS
Program: Observations of ADR Spe-
, 18 H
. & E
. L.J. 399 (2001); James R. Antes et al.,
Conflict Interactions in the Workplace: Documented Effects of the USPS REDRESS
, 18 H
. & E
. L.J. 429 (2001); Jonathan F. Anderson & Lisa B.
Upstream Effects from Mediation of Workplace Disputes: Some Preliminary
Evidence from USPS
, 48 L
. L.J. 610 (1997). Even though the design and evaluation
of the USPS dispute resolution program constitutes a significant improvement com-
pared to prevailing quality control efforts (described in Part I.B), the program has
remained faithful to traditional confidentiality perceptions and, therefore, its impact
remains limited. Designers of the program substituted the measurement of settle-
ment rates with more nuanced quality control measures in order to better capture the
quality of mediation services performed and their impact on workplace culture (
, at 379–81). Since mediators mediate without a co-mediator or ob-
server present, real-time information on mediator performance is extremely limited
and is usually restricted to a mediator’s first case. This is used to determine whether
to include her in the USPS mediator roster (
Nabatchi & Bingham,
404–05). Research on consequent mediator conduct has not been conducted on an
ongoing basis and the information that is available is filtered through the eyes of the
Antes et al.,
, at 430–32), for whom it is extremely difficult, if not
impossible, to know and assess her own interventions, or through parties’ recollec-
tions of the occurrences (
Nabatchi & Bingham,
, at 426), which can also be
unreliable as an evaluation tool. Interestingly, mediators, when interviewed on their
practice, reported that they feel isolated and would welcome more feedback and gui-
dance on their performance (
Antes et al.,
, at 464).
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organizations (such as Intel)
have instituted this type of arrange-
ment. There are several advantages to embedded systems. First, ac-
cess to a high volume of disputes that arise in the context of a
particular workplace or market can reveal patterns of disputes that
occur repeatedly and indicate effective means for addressing such
disputes. SquareTrade has, in addition to studying resolution
studied such patterns as whether there are specific types of
disputes that are more likely to settle than others (e.g., international
disputes), whether there are particular types of dispute filers who are
more likely to settle than others, and what the parties’ feedback rat-
ings are in cases that are more likely to settle.
In some instances,
such evaluation has enabled SquareTrade to understand which
mediators it should assign to specific cases and how to compensate
mediators most fairly and cost-effectively.
of information collected also can affect its marketing and outreach
efforts by leading SquareTrade to focus its efforts on those categories
of cases in which it has been most successful and for which it can
provide what it believes to be a more satisfying service to users.
In addition, dispute patterns can reveal chronic deficiencies in
the dispute resolution system itself, which can hamper the delivery of
satisfactory services (such as the incomplete typology of disputes in
SquareTrade’s automated process described above).
Trade’s embedded position has enabled it to proactively gather infor-
mation from a pool of eBay users on how to design and improve its
note 31, at 499–509. Intel’s dispute resolution system has
challenged traditional ADR approaches to data collection and confidentiality. Its sys-
tem for addressing workplace complaints and conflicts is designed to track all griev-
ances and store data in its database in real time, allowing for individual case
evaluation, pattern examination, and consequent investigation by specialists. It is
not surprising that this system emerges in a technologically data-driven environment.
Also, there are real advantages for organizations in developing internal dispute reso-
lution systems that record data and have a “memory.”
105. SquareTrade analyzes settlement rates reached in the automated negotiation
and mediation processes, settlement rates per dispute type, per mediator, and most
common resolutions, etc. Interview with Nate Lipscomb,
106. Interview with Cara Cherry-Lisco,
107. Interview with Cara Cherry-Lisco,
109. Disputes can also expose recurring problems in the marketplace in which dis-
pute resolution services are offered. For example, repeated disputes over whether a
buyer has committed to making a purchase or not may influence an unclear market-
place policy. A particular mediator may encounter several such disputes and report
back to the dispute resolution team on the trend, or, alternatively, the dispute resolu-
tion team may pick up on the recurrence when performing routine data analyses. In
the eBay-SquareTrade case, I have not received information on the extent of such
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Harvard Negotiation Law Review
Unlike external mediation providers, SquareTrade has
access to its pool of potential users. These users have an interest in
providing such information to SquareTrade since they have more of a
stake in the SquareTrade system than the typical one-shot disputant
in non-embedded mediation. Mediators also have been an important
resource in revealing such trends. SquareTrade’s dispute resolution
team actively encourages them to think about issues systemically,
and provide feedback on the system.
more, internal dispute resolution services, particularly in the case of
voluntary mediation services, enhance incentives for participation
and enforcement of any resolution reached by tying such efforts to
other long-term interests of the disputing parties. For example, in
the case of embedded mediation services at the workplace, employees’
or managers’ participation in any dispute resolution effort and their
ability to reach a resolution is tied to their interest in keeping their
position, status and reputation, possibility of promotion, and mainte-
nance of a healthy work environment.
In the context of e-commerce, long-term stakes in one-shot trans-
actions between strangers are exceptional, but eBay has managed,
most notably through its feedback rating system, to make its site a
marketplace for repeat users in which there are financial and reputa-
tional repercussions for misconduct and benefits for good behavior.
EBay has taken this a step further in the dispute resolution context
by making the SquareTrade system one of the few avenues for revis-
ing feedback once submitted
and by providing a space on the eBay
website for its users and SquareTrade personnel to provide guidance
and explanations on SquareTrade’s dispute resolution services.
SquareTrade, on its end, has further strengthened this symbiosis
through the seal program, which creates incentives for seal members
analyses, but it seems that the scope of disputes SquareTrade handles for eBay would
allow for this type of examination.
110. Interview with Cara Cherry-Lisco,
111. Interview with Nate Lipscomb,
(describing how as opposed to traditional ADR, which often lacks efficient
channels for mediator feedback to providers, SquareTrade mediators could easily con-
tact the head mediator through e-mail when they would encounter repeat problems).
One example in which mediators were able to uncover repeat problems had to do with
users’ misconceptions about the mediation process and the mediator’s role, problems
that were later remedied by eBay. Interview with Cara Cherry-Lisco,
(stating that SquareTrade has shared only aggregate information on volume and set-
tlement rates); Interview with Nate Lipscomb,
113. According to eBay policies, feedback that is posted can only be removed
through mediation facilitated by a SquareTrade mediator or, under certain circum-
stances, through eBay. EBay Feedback Abuse, http://pages.ebay.com/help/policies/
feedback-removal.html (last visited Apr. 5, 2005).
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to participate in the dispute resolution system and abide by resolu-
At the same time, being embedded can also take its toll. The in-
ternal delivery of dispute resolution services that are premised on
neutrality can jeopardize their actual or perceived independence.
Thus, in this context, the impartiality of the dispute resolution team
is particularly vulnerable, and the question of accountability becomes
all the more pertinent, as demonstrated below in the discussion of the
need for external accountability.
The SquareTrade system creates a web of incentives for Square-
Trade, its mediators, and its users, which results in increased ac-
countability. The simultaneous documentation of all ODR
communications serves to constrain mediator behavior ex ante.
This incentive is reinforced by mediators who can seek guidance from
the SquareTrade dispute resolution team during the mediation with-
out losing face. This differs from the awkwardness of having to inter-
rupt a face-to-face session in order to seek advice. In addition, the
fact that SquareTrade mediators are paid for their services,
vates them to perform well and conform to guidelines, standards, and
training instructions. Paying jobs are difficult for mediators to ob-
tain; many offline mediators are retirees who volunteer their ser-
vices, and the few paid mediator positions tend to be taken by former
judges. SquareTrade mediator positions are even more attractive be-
cause the work involved can be carried out during flexible hours at
On the users’ end, the ability to effortlessly e-mail feedback di-
rectly to SquareTrade’s customer service group and not have to do so
indirectly through the mediator
serves as an incentive to convey
such impressions. Not only is it easier to complain, but because users
notes 24–27 and accompanying text.
115. Employees may view such a unit as pro-management because its members
ultimately depend on the organization for their remuneration, continued employ-
ment, and budget.
117. Interview with Nate Lipscomb,
118. Interview with Cara Cherry-Lisco,
119. Interestingly, the SquareTrade pool of mediators is diverse not only in terms
of country of origin, but also in terms of race.
120. Interview with Nate Lipscomb,
note 18; Telephone Interview with
Colin Rule, ODR Director, eBay (Jan. 28, 2004) (stating that at OnlineResolution,
users would be assigned a contact person whom they could approach with any ques-
tions and concerns through e-mail).
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Harvard Negotiation Law Review
have a greater chance of using the SquareTrade system in the future
than disputants relying on random ADR providers’ services in the
traditional mediation world, they have a stronger incentive to report
Users’ complaints can be verified easily, which
enhances mediators’ incentives to perform well. Conversely, offline,
mediators and users often find it difficult to communicate their obser-
vations to providers
and any feedback conveyed is much harder to
Summary: The SquareTrade Accountability Framework
As the analysis above demonstrates, SquareTrade has generated
internal structural accountability by instituting structures for:
(1) gathering broad and rich information on mediator interventions
and party needs (much of which is collected in real time) and on ongo-
ing efforts to evaluate the quality of services rendered; (2) monitoring
mediator performance; (3) developing a more nuanced understanding
of confidentiality; (4) devising fixed processes and limited substantive
options for resolution, thereby promoting consistency and refining
the meaning of flexibility; and (5) internalizing incentives for
mediators to perform well and for the system as a whole to identify
deficiencies and successes and learn from them.
As stated above, the SquareTrade effort does not, however, re-
present a complete exercise in structural accountability since it is
wholly internal and does not include external accountability, i.e.,
oversight by a credible, independent entity.
ity is important for two reasons. First, external accountability can
extend beyond an examination of whether performance has met the
provider’s preset goals by assisting the provider in questioning the
adequacy of the goals themselves and the means used to achieve
them. Thus, an external body or authority, drawing on the informa-
tion revealed in the course of monitoring as well as its own experience
and knowledge from other settings, can assist providers in improving
and developing their organization. Second, external accountability
provides an additional layer of credibility for the internal efforts at
quality control by revealing those instances of poor performance
missed in the internal examination, and by providing an impartial
121. One study found that eighty percent of SquareTrade users say they would use
the service again. Tyler,
note 89. This statistic demonstrates an interest on the
part of such users to provide feedback even if they in fact end up being one-time users.
122. Interview with Nate Lipscomb,
note 31, at 537–53 (describing incomplete structuralism in
the context of workplace regulation and the case studies analyzed in the article).
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evaluation that can address concerns on potential conflicts of inter-
ests between providers.
For example, in SquareTrade’s case, a concern could arise with
respect to the resolution of disputes involving seal members. Square-
Trade presents its dispute resolutions services and seal program as
complementary and, as has been demonstrated, in many aspects they
are. However, there is also a potential for a conflict of interests be-
tween the two services. Seal members are, potentially if not in prac-
tice, repeat users of the dispute resolution system, and although they
do not pay for mediation services (as one of the perks offered to
them), they are vital to SquareTrade’s financial viability and hence to
its mediators’ future employment. As explained above, mediators,
even though they are not decision-makers, can influence the decision-
making process, particularly when they can recommend a resolution
to the parties. A concern could arise that, because seal members are
repeat players, SquareTrade’s dispute resolution services would favor
them over their counterparts. Whether this potential conflict of in-
terests has actually materialized is impossible to determine since in-
dividual resolutions and aggregate data on how seal members fared
in comparison to non-members have not been made publicly availa-
ble. Although there is no indication that this potential conflict of in-
terests has been realized, absent external accountability, it remains
an open question.
EARNING FROM THE
Applying the SquareTrade Experience in Other Online Contexts
The significance of the SquareTrade experience is derived from
the mitigation of the accountability dilemma in a single context, lim-
ited as it may be. A kindred application of some of the principles
underlying SquareTrade’s accountability framework can be found in
eBay’s internal ODR initiative. In late 2003, eBay hired Colin Rule
as its ODR director to design and implement an internal, structured
direct-negotiation process between disputing eBay users, as well as to
rethink some of the current services provided to eBay users through
note 32, at 1922 (“[E]ven
though dispute resolution professionals seek to create a creative, flexible, well-mean-
ing, and self-regulating profession, it is now clear that increased use of ADR has
raised these issues of quality control, ethical standards, accountability, and
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Harvard Negotiation Law Review
In eBay’s negotiation tool, as in SquareTrade’s au-
tomated negotiation process, code substitutes for third-party facilita-
tion and thus enhances accountability by limiting discretion and
making decision-making junctures and their consequences review-
able. EBay’s process is currently offered for two types of disputes
only—“unpaid item” and “item not received.” Unlike SquareTrade’s
automated negotiation device, which matches problems to solutions,
the eBay in-house processes focus on identifying the key information
that needs to be exchanged between parties and implementing a pro-
cedure that guarantees the exchange of these data.
The question arises whether the SquareTrade framework may
handle disputes that are different from the typical eBay grievance
while preserving the features of its system that promote accountabil-
ity. There is reason to believe that SquareTrade and other ODR
providers’ “docket” will become more diverse as the technological
means for performing ODR services become more advanced and soci-
etal perceptions about what can and cannot be performed online con-
tinue to evolve. It is clear that there are real limits to what a
mediator can do in mediations like SquareTrade’s that consist solely
of written messages sent back and forth. As technology advances, we
can expect richer modes of ODR communications that will allow for a
broader range of disputes to be addressed online.
But ODR’s strength may ultimately be derived not from how well
it is able to mimic traditional forms of ADR through advancements in
the means of transmission of information (e.g., inexpensive video con-
ferencing technologies), but in the evolution of new tools for informa-
tion processing and management—like SquareTrade and eBay’s
125. Telephone Interview with Colin Rule, ODR Director, eBay (Jan. 21, 2004).
In addition to referring its users to SquareTrade for the resolution of dis-
putes, eBay has begun to internally develop certain online negotiation processes. For
particular types of disputes, eBay’s in-house processes offer avenues for the exchange
of missing information that is necessary for the resolution of a grievance with respect
to an item purchased on eBay. For example, with respect to an unpaid item dispute,
if the buyer claims that payment has already been made, the buyer can, through this
tool, provide details of the payment to the seller for review. EBay’s Unpaid Item Pro-
cess, http://pages.ebay.com/help/tp/unpaid-item-process.html (last visited Oct. 6,
2005). Similarly, in the case of an “item not received” dispute, if the item has already
been shipped, the seller may provide the buyer with shipping details.
Not Received or Significantly Not as Described Process, http://pages.ebay.com/help/tp/
inr-snad-process.html (last visited Oct. 6, 2005).
Katsh et al.,
note 97, at 718. In ODR, richer communication could
be created by substituting two-way video communication for e-mail and by leveraging
unique online capabilities that are not available offline and enrich the mediator’s “tool
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automated negotiation tools. These tools could make ODR an attrac-
tive option for many disputants, on- and offline,
often as a comple-
mentary service to traditional ADR, because of ODR’s added
efficiencies and its potential for generating accountability and trust.
One current experiment provides a demonstration of the range of
settings to which ODR could be applied. The Center for Information
Technology and Dispute Resolution at the University of Massachu-
setts Amherst recently received a National Science Foundation grant
to develop ODR systems for government conflict management.
The Center is partnering with the National Mediation Board, an
agency that oversees labor-management relations in the railroad and
airline industries and administers a dispute resolution system to dis-
putes over the interpretation or application of agreements in these
The project explores the ways in which ODR can en-
hance and complement the existing dispute resolution system. Even
at this early stage, the researchers have found opportunities for im-
proving the system through adopting ODR tools.
signals the direction in which the ODR “docket” is likely to expand in
the future. In a fashion reminiscent of the SquareTrade example, the
introduction of ODR into other contexts, traditionally regarded as too
sensitive or complex for such tools, carries a promise for increased
These trends are likely to be reinforced by broader developments
and social changes.
As people spend more and more time online,
the range of activities they perform online and their perception of
what is appropriate and possible there will change and will include
more complex disputes in which parties typically attach a higher de-
gree of importance to confidentiality. This is not to argue that ODR
will displace ADR; there will always be certain types of disputes, such
as highly emotional divorce mediations, for which a system like
SquareTrade’s would not be the appropriate avenue. However, there
is a body of disputes (among businesses with ongoing relationships or
Bringing Online Dispute Resolution to Virtual Worlds: Cre-
ating Processes Through Code
, 49 N.Y.L. S
. L. R
. 271, 284–85 (2004).
129. The Center for Internet Technology and Dispute Resolution, http://www.odr.
info (last visited Oct. 6, 2005).
130. Ethan Katsh et al.,
Early Lessons from the Application of Process Technology
to Online Grievance Mediation
katsh_early.pdf (last visited Oct. 10, 2005).
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Harvard Negotiation Law Review
between individuals and government offices) that currently is not ad-
dressed through ODR but very well could be.
EBay’s own expan-
sion, in terms of the types of transactions conducted through its
site—some of which were thought wholly inappropriate for the online
context, such as car and real estate purchases—is a telling illustra-
tion of the ways in which the line separating on- from offline activi-
ties is constantly shifting, often in unexpected ways. Therefore, there
is reason to believe that the scope of disputes handled by ODR sys-
tems (SquareTrade included) will expand in the future, while pre-
serving at least some of the features of these systems that have been
effective in generating accountability.
Another question concerns the applicability of the SquareTrade
experience to non-embedded dispute resolution systems. It is clear
that SquareTrade’s quasi-embedded position has played a significant
role in its success—first and foremost by supplying a steady flow of
disputes, the lifeline of any dispute resolution system—but also by
giving the system teeth and making patterns more readily discerni-
ble. A non-embedded service would clearly be less effective, particu-
larly when it is an offline service—where the gathering of
information is both more difficult and expensive. However, even for
dispute resolution providers whose disputes come from a variety of
sources, benefits, albeit more limited in scope, nevertheless exist and
the costs related to information gathering can be controlled,
ing the SquareTrade accountability system an instructive example.
Applying the SquareTrade Lessons to Traditional Mediation
In the traditional mediation arena, it is much more difficult and
costly to collect real time information and confidentiality concerns
are more prevalent. In the following section, I examine the potential
for applying the lessons of SquareTrade by drawing on a recent re-
form proposal by Safe Horizon, a traditional mediation provider, to
improve mediator quality assurance.
Safe Horizon Mediation Services is a community mediation
center that operates in accordance with article 21-A of the New York
It handles community disputes and court-referred
Government-to-Citizen Online Dispute Resolution: A
, 79 W
. L. R
. 159, 168–72 (2004).
134. For example, costs can be controlled by relying on volunteer mediators or
trainees for real time information gathering. Trainees are already required to ob-
serve mediation sessions for training purposes, but they could also be used for quality
135. N.Y. J
art. 21-a, § 849-a (2003).
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at no charge to disputants and is funded in part by the State
and City of New York.
Through the initiative of the then Director of Safe Horizon, Eliz-
abeth Clemants, Safe Horizon has developed a novel program for re-
forming traditional, non-embedded mediation.
Frustrated by her
own ignorance of what transpired in Safe Horizon-sponsored media-
tion, Ms. Clemants created an innovative way of broadening the
scope of information she and other staff members could review.
Under the new program,
which has yet to be implemented, all me-
diation sessions would be conducted with either a co-mediator or ob-
server present. Both the mediator and her counterpart would fill out
detailed logs on the dynamics of the mediation, and this information,
together with any mediated resolutions reached, would be kept in in-
dividual mediator files. Once a year, the staff would meet with its
mediators, review all the information in their individual files, and
136. The Safe Horizon dispute load consists generally of harassment, noise, and
minor criminal complaints; family conflicts; arguments between youth; parent/teen
conflicts; child custody and visitation disputes; school concerns; special education dis-
agreements; and property, housing, and financial disputes. S
org/files/Mediation_Brochure_Eng.pdf (last visited Oct. 9, 2005).
137. The state funders collect the data reported by the various providers and pro-
duce an annual report that includes statistical data on all funded providers. The
city’s criteria for funding is quantitative and requires providers to have mediated a
minimum number of cases, with a prescribed percentage of such cases scheduled for
mediation, and also requires that there be a follow-up phone call for a percentage of
cases that result in a written agreement. As part of its efforts to collect information
pursuant to these and other requirements, Safe Horizon requires its neutrals to fill
out paperwork regarding the cases they handle, covering such matters as the type of
dispute (family, landlord-tenant, neighbor, etc.), name of mediator, number of ses-
sions, length of each session, and outcome (agreement, no agreement, partial agree-
ment). It also collects disputants’ feedback through party satisfaction surveys.
Mediated resolutions are not systematically reviewed by Safe Horizon for substantive
fairness issues and have not been used, up until now, as a means for quality control
over mediators. These practices are scheduled to change under the new initiative
Interview with Elizabeth Clemants,
note 143, and various
Safe Horizon form samples supplied by Clemants (forms on file with author).
138. There are several other programs delivering traditional ADR services whose
systems represent novel approaches to accountability, one of which is Intel’s internal
dispute resolution system.
note 104 and accompanying text. Those efforts
with which I am familiar take place within organizations and as such have built-in
incentives for creating a system that records information and detects patterns. The
Safe Horizon initiative takes place in a different environment—that of a non-profit
community mediation service that provides mediation services mostly to one-shot
139. Interview with Elizabeth Clemants, Director, Safe Horizon, in N.Y., N.Y.
(July 13, 2004).
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provide feedback. If warranted, Safe Horizon staff would provide fur-
ther training and mentoring to mediators, and, if necessary,
mediators would be decertified. Decertification procedures as well as
other guidelines and standards would be clarified and systematically
In addition to collecting this kind of information, Clemants
wanted to expand the follow-up on cases that were handled by Safe
Horizon in order to learn how mediation affected not only cases which
resulted in written agreements, but also those which resulted in oral
agreements or no resolutions at all.
By employing these tools, Safe
Horizon could help ensure a stronger degree of accountability.
Clemants’s plan represents a radical departure from the current
procedures at Safe Horizon,
where very little information is col-
lected on mediation practices, and it is difficult to ensure consistency,
internalize incentives, or conduct meaningful, qualitative evaluation
of the services rendered. Most interesting for our purposes, the initi-
ative displays some of the ways in which the principles of structural
accountability can be translated into the traditional, non-embedded
As reflected in the SquareTrade example, there is a need for real-
time information on dispute resolution efforts—a need which would
be met by Safe Horizon’s proposal that an observer collect informa-
tion simultaneously with the mediator. The proposal controls costs
by relying on a volunteer mediator base and by having observers doc-
ument the information on forms, thereby sorting out key elements in
Obviously, the information is seen through the eyes of
an observer and, as such, is never as objective as a simultaneous re-
cording, but this lack of objectivity is counter-balanced, to a certain
140. Interview with Elizabeth Clemants,
. and various Safe Horizon form samples supplied by Clemants (on file
with author) (describing the limited types of information collected by Safe Horizon as
part of its efforts to meet reporting requirements by its funders, New York State and
New York City, by both filling out paperwork on the type of dispute, name of media-
tor, number of sessions, length of each session, and outcomes of its cases and by col-
lecting disputants’ feedback through party satisfaction surveys).
144. Other means for controlling costs could include relying on Safe Horizon’s
trainees, who are required to observe mediations as part of their certification process.
Currently, they are not requested to formally summarize their impressions, and their
feedback is not systematically gathered so that they can learn from it. Another
method for economizing could be to institute a more targeted scheme for collecting
broad information, which would only apply in some of the cases (where complaints
have been made, in random cases, etc.).
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extent, by the fact that this method minimizes the intrusion on par-
ties’ comfort level and reduces cost by prioritizing information.
In addition, the Safe Horizon plan, through its mediator review
sessions, has recognized that mere information gathering is insuffi-
cient and that caretakers of information, responsible for analyzing
and learning from the information gathered, must be designated if
the organization is to improve. Furthermore, having more than one
mediator present (particularly if co-mediators or observers are cho-
sen at random) and conducting annual review sessions could promote
consistency in mediator practice.
An additional step in this direction could be the development of
criteria for effective mediation practice that would guide mediator
conduct ex ante and allow for mediator evaluation ex post. Standards
need not imply rigidity and can be devised and enforced in a dynamic
manner that preserves mediation’s flexibility. This was done in the
transformative mediation context
in an experiment by Della
which demonstrates in detail how to convert general princi-
ples into specific mediator practices while preserving flexibility. For
example, she explains that a transformative mediator should orient
parties “to their own agency”; the mediator “support[s] the parties’
decision-making process” by offering decision-points to the parties
but giving only tentative suggestions with alternatives.
ing standards from data collected and constantly re-examining them
in light of new information, the field can maintain its ability to ac-
commodate the particulars of various situations while promoting con-
sistency across cases and limiting, to some extent, mediator
Safe Horizon’s plan also demonstrates an understanding of the
need to internalize incentives for the various actors to improve their
145. There are three main schools of practice—evaluative, facilitative, and trans-
formative mediation. Transformative mediation views the process parties go through,
and not the resolution of the dispute, as being at the center of the mediation process,
while resolutions is clearly a goal of the other two schools. Transformative mediators
strive for party empowerment and recognition of their own as well as their counter-
parts’ interests and goals and seek to transform destructive and negative communica-
tion into constructive and positive interaction between parties.
102–04 (1994); Leo-
nard L. Riskin,
Understanding Mediators’ Orientations, Strategies, and Techniques: A
Grid for the Perplexed
, 1 H
. L. R
. 7, 13 (1996).
146. Della Noce et al.,
Identifying Practice Competence in Transformative
Mediators: An Interactive Rating Scale Assessment Model
, 19 O
. 1005, 1006 (2004).
. at 1049–54.
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practice and the system. Its current system of quality control for cer-
tified mediators—relying on peer review of a mediator in action—has
not been effective at weeding out substandard mediators, in part be-
cause the requirement has not been systematically followed and en-
Even when peer reviews are conducted, mediators tend to
choose their friends as evaluators in peer reviews,
hardly an effec-
tive way to remove poor performers. By abolishing this system and
always having more than one mediator present when conducting a
mediation, Safe Horizon would create incentives for mediators to im-
prove performance. The institution of annual reviews would estab-
lish an opportunity—perhaps not frequent enough—to convey
feedback from Safe Horizon to its mediators and vice versa. Indeed,
mediators can be a valuable conduit of information on individual
problems and systemic issues, as demonstrated by the SquareTrade
Moreover, the willingness to gather more information than is
currently collected internally represents a different, more compound
view of confidentiality than has been typically held by traditional me-
diation providers. Like SquareTrade, the Safe Horizon plan recog-
nizes the distinction between internal information gathering and
analysis on the one hand and external disclosure of aggregate pat-
terns on the other; in so doing, it distinguishes between secrecy and
anonymity. By protecting the confidentiality of all mediation commu-
nications, New York law
ensures that the secrecy of mediation
communications is not compromised by the internal collection of
broad information by New York providers.
Additional categorizations of dispute types by disputants’ con-
cerns about confidentiality could further broaden collection and ex-
ternal sharing of information by providers like Safe Horizon. One
could identify particular types of disputes in which parties feel com-
fortable with transparency, which would allow for a higher degree of
information collection and sharing. In this context, it is important to
bear in mind that the disputes handled by SquareTrade resemble the
substantial portion of disputes resolved through Safe Horizon and
148. Interview with Elizabeth Clemants,
150. N.Y. J
art. 21-a, § 849-b(6) (2003).
151. Although the mere existence of a record does give rise to the concern that it
would be subpoenaed in the future or leak out in some other manner, the risk could be
mitigated by eliminating the record within a relatively short time frame that never-
theless allows for analysis and monitoring to take place. Another concern involves
the wide variance of confidentiality protections across the various states.
, prefatory note (2001).
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other community dispute resolution providers—i.e., small claims.
Even though the typical small-claim dispute often involves an actual
or potential ongoing relationship (a purchase gone wrong at the local
store), the availability of feedback ratings on eBay makes these dis-
putes more similar than it would at first appear. Most importantly in
our context, small claims disputes, like eBay grievances, tend to be
less privacy-sensitive and would, therefore, allow for extensive infor-
mation collection and sharing, as opposed to family disputes or har-
assment cases where a more conservative approach would be
Finally, unlike SquareTrade, Safe Horizon is subject to external
accountability measures through regulation, funding, and profes-
Safe Horizon, under the new plan, would be able
to produce reports that extend beyond statistics on types of disputes,
referral sources, and their ultimate disposition. Currently the State
of New York tracks the number of cases handled by gender, age, and
However, this tracking does not allow for a
scrutiny of the interplay between these demographics and particular
mediator interventions and mediator styles on dispute outcomes. The
Safe Horizon reform would allow for such analyses, but as long as the
information underlying the aggregate trends could not be shared ex-
ternally, it would be difficult to assess whether Safe Horizon was ask-
ing the right questions and whether it had taken full advantage of
the information gathered. A creative way to overcome the difficulty
of monitoring in the face of confidentiality has been through the use
of mediating actors.
These actors have, in various contexts, ful-
filled a complex role in which they have both vouched for the veracity
of the aggregate information disclosed and participated in generating
the norms according to which the information disclosed was evalu-
ated and judged.
Susan P. Sturm,
Lawyering for a New Democracy: Lawyers and the Prac-
tice of Workplace Equity
, 2002 W
. L. R
. 277, 305–06, 313, 316, 319 (2002).
note 31, at 552.
. at 523–24. A useful example in this context is the successful adminis-
tration of power plants by the Institute of Nuclear Power Operations (INPO). This
body, which was created and funded by the plants themselves, establishes
benchmarks, pools data on industry practices, and evaluates the individual plants
accordingly. Although this regulating entity is a private body and the data it pools
remains confidential, it has been “an unqualified success story” and has drawn—by
maintaining confidentiality—widespread participation of utilities. Furthermore, the
accountability of self-regulatory efforts is enhanced by the production of reports that
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At the core of this Article lies the apparently insoluble dilemma
of mediation—the clash between confidentiality and flexibility on the
one hand and accountability on the other. The Article demonstrates
one context, an ODR system, in which this dilemma has been miti-
gated through the implementation of an incomplete structural ac-
countability system. It has become apparent that neither private
unregulated mediation services nor formal attempts to regulate com-
munity and court-referred mediation programs have been completely
successful in ensuring accountability. The structural approach
avoids some of the pitfalls associated with both formal mechanisms
and informal market forces with regard to mediation. It has allowed,
at least in the SquareTrade context, for a flexible and dynamic set-
ting without foregoing the possibility for quality control and
A close scrutiny of the SquareTrade story reveals how contempo-
rary technological innovation and the ensuing changes in values and
attitudes can generate more nuanced concepts of confidentiality and
flexibility and, through them, increased accountability. It is tempt-
ing to apply these developments to the traditional mediation milieu
where the accountability dilemma has been most troubling. While
our present ability to apply such developments in ODR directly to
traditional mediation is limited, some of the principles embodied in
the SquareTrade experience—refining flexibility to promote consis-
tency, putting limits on discretion by internalizing incentives, and
unpacking confidentiality to permit broader and richer information
gathering, analysis, and monitoring—can be instructive in the design
of more accountable dispute resolution systems offline.
In the coming years, ODR’s influence over traditional mediation
is likely to increase by the anticipated developments in the scope and
effectiveness of online mediation. With new technologies and an ex-
pansion of the types of activities performed on the Internet, addi-
tional types of disputes, including more complex conflicts, are likely
reach “important watchdog groups.” In the mediation context, mediating actors such
as professional associations and consumer organizations could fulfill this role by au-
diting reports prepared by providers for authorities and funders and examining the
information underlying anonymous statistical data. In addition, by studying the raw
information, these mediating actors could assist providers in generating and refining
standards for their practice and in identifying trends and patterns relating to the
disputes they handle. A particularly important role for these intermediaries could be
the development of uniform categories, according to which various providers’ efforts
would be compared.
Michael C. Dorf & Charles F. Sabel,
A Constitution of Demo-
, 98 C
. L. R
. 267, 371–73 (1998).
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to be addressed by such services as SquareTrade. These additional
types of disputes will affect, directly and indirectly, the procedures
and norms of traditional mediation. As the line separating the on-
and offline worlds keeps shifting, even our most rigid convictions are
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