Fact Pattern
Consider again Acme, Inc, the company discussed in the first two modules. As noted in the two modules above, the company faces fairly frequent litigation of several different types. These include, as noted, disputes by suppliers and disputes involving delivery of products to customers. In addition, Acme has occasionally been sued by its employees, for complaints including breach of the employment contract.
As a way to lessen the risks posed by these forms of litigation, Acme is considering putting arbitration clauses in its contracts with suppliers, customers, and employees.
Acme is very interested in the potential that these clauses might have to reduce costs and improve litigation outcomes for Acme.
Questions
Your boss has asked you to prepare another very brief, two page (double-spaced) memo addressing the following:
How arbitration differs from litigation
What advantages arbitration might provide over the courts for Acme
What kinds of risks (if any) the use of arbitration clauses might pose for Acme.
Whether you would recommend the inclusion of arbitration clauses by Acme in some or all of the contracts it has with suppliers, customers, and employees.