Karla Grossenbacher Published in the Law Journal Newsletters’ Employment Law Strategist
“Limitations on Third-Party Discovery in Arbitration"

Washington, D.C. Partner Karla Grossenbacher’s article, “Limitations on Third-Party Discovery in Arbitration,” was published in the May 2011 edition of Employment Law Strategist. In the article, Karla encourages employers to take a serious look at company policies that might require employees to sign agreements calling for mandatory arbitration of any claims arising from their employment. According to Karla, it is vital to first weigh the pros and cons of arbitration, as its disadvantages may outweigh its advantages.

Karla goes on to outline some of the negative possibilities of arbitration, including lack of substantial savings in discovery cost, “the potential inability to compel third-party discovery,” “lack of direct appeal, inexperience and capriciousness of arbitrators and lax rules on the admission of evidence.”

While the goal of arbitration may be to reduce cost, Karla explains that the efficiency required in arbitration may cost the company more in the long run. “Although it is true that when both parties have the ability to compel third-party pre-hearing discovery, the potential cost-savings to be achieved through arbitration are diminished. Not having the ability to compel discovery from third parties prior to the hearing can affect the employer’s ability to prevail in the arbitration because critical evidence may not be available. Any employer in a business that involves a good deal of third-party traffic, such as those in the hospitality industry, where guests, customers or vendors might witness relevant conduct, should think twice about having arbitration be the sole means through which employment disputes may be resolved.”