Georgia State University
One Year Later: Has Atlanta’s Arbitration Push Paid Off? – Global Atlanta, July 26, 2016

photo_03-1000x714

It’s been almost a year since the Atlanta Center for International Arbitration and Mediation opened at Georgia State University to compete for international arbitration proceedings with cities such as Miami, New York, London, Brussels and Hong Kong.The city’s civic and legal communities believed that Atlanta’s accessibility, its status as a base for Fortune 500 firms and its position in a pro-arbitration state welcoming to international attorneys would be a formula for success.

But has Atlanta’s “If we build it, they will come” legal gamble paid off? To many, it’s too early to tell, although the signs are positive.

Glenn Hendrix, chair of Arnall Golden Gregory LLP and a member of the center’s advisory board, says his expectations for bookings at the center were moderate given the way arbitration is agreed upon in corporate deals.

“There’s a lag between the time parties write a dispute resolution clause into their contracts providing for arbitration in a particular venue and the time a dispute actually arises,” Mr. Hendrix told Global Atlanta.

But the GSU-based center has played its part in elevating Atlanta’s brand as a place to hold hearings, an effort first undertaken by the still-active Atlanta International Arbitration Society, behind which Mr. Hendrix was a driving force.

“In terms of the center raising awareness of Atlanta as an arbitral venue, my expectations were high, but they’ve been exceeded. It takes time to capture hearings, but bookings at the facility are increasing.”

Mr. Hendrix lists the center’s strong points as its functional design, “world-class” technology and its “convening function” for internationally minded lawyers throughout the Southeast.

“The weakest point is that the center is still a startup and not yet top of mind as a hearing venue,” Mr. Hendrix said.

Shelby Grubbs, the center’s executive director, agrees it takes years for a center to establish itself. He has undertaken trips to those centers that now count themselves in the upper echelon in attracting arbitrations.

“Singapore and Hong Kong have only recently begun to be mentioned along with London, Paris and New York as top-tier facilities,” he said.

The Singapore International Arbitration Center recently celebrated its 25th anniversary; Hong Kong’s center was established in 1985.

Citing confidentiality, Mr. Grubbs can’t disclose specifics about hearings hosted at the center but says that “six months into the operation of the hearing facility, we are doing okay.”

The center’s marketing efforts are to align itself with big international institutions that have fairly constant inventories of disputes, such as the International Chamber of Commerce, the International Center for Dispute Resolution, the Bogota Chamber of Commerce, the Vienna International Arbitral Centre and JAMs. It has signed cooperation agreements with many of these organizations and more.

The ACIAM also works to raise its profile with industries such as retail securities brokerage, maritime transactions and construction and risk management.

Since it often is the corporation’s general counsel who selects the potential arbitration site, it is important for the centers to forge relationships with top inside counsel, even if they aren’t necessarily arbitration friendly.

And not all are. At a recent meeting co-organized by the ICC Young Arbitrators Forum and the Atlanta International Arbitration Society, Gary Bunce, assistant general counsel for Delta Air Lines Inc., stirred a bit of a controversy when he admitted he wasn’t a fan of mediation or arbitration.

“I’ve done a lot of arbitration and I found that it was not cheaper nor took less time, which are two of the supposed advantages. I don’t like that there is no appellate review,” he said at the event, spurring some pointed discussion with the arbitration-friendly crowd. “I also feel that in maybe 85 percent of the cases it tends to be a split-the-baby type of decision that goes down the middle.”

Mr. Grubbs of the Atlanta Center for International Arbitration and Mediation (also a longtime litigator at Miller & Martin LLP’s Atlanta office), said he wouldn’t advise a company to use arbitration if its attorneys aren’t comfortable with the process, and he admitted it’s not a perfect method for dispute resolution. But there isn’t one, in his opinion.

“I can say what the published data show: that arbitration is regarded by most companies engaged in international commerce as the best alternative available,” he said. “Most practitioners appear to agree that international arbitration offers efficient, expert, enforceable and objective outcomes, and none of these is offered in equal measure – if at all – by international litigation.”

From at the ACIAM’s perspective, it’s also not just about hearings. The center wants to play a role at the forefront of the use of technology in arbitration proceedings, as well as help educate the next generation of arbitrators.

“(Hearings are) only part of the equation,” says Erica Birg, a litigation partner at Nelson Mullins Riley & Scarborough LLP. “The other half, the educational and (alternative dispute resolution) promotional goals are far exceeding expectations for educating, promoting, and supporting practitioners and scholars in the area of international arbitration.”

Indeed, the center provides academic support that includes coaching university moot teams, arranging guest lectures and developing course materials for the law school’s executive education and continuing legal education departments.

That helps bring awareness early on in the careers of those who will be writing their preferred arbitration seats into future corporate contracts.

“I have every reason to expect that more international arbitration hearings will come to Atlanta in the future,” Ms. Birg told Global Atlanta.

And while Atlanta tries to gain momentum, other more established hubs see the arbitration pie as being large enough for more players.

Stressing that it’s not truly a competition, Daniel Gonzalez, global head of the international arbitration practice with Hogan Lovells in Miami, points out that Miami offers many of the same positive attributes as Atlanta and concedes it takes time to be established.

“It’s not something that happens overnight,” he said.

The Miami’s center’s acceptance started after a core group of attorneys who practiced international arbitration were asked by their corporate attorney partners to recommend an arbitration center.

“When drafting these contracts we started recommending Miami and the momentum started catching on. It probably grew gradually 20 years ago and caught on 15 years ago.”

One advantage Miami has over Atlanta is the number of attorneys with more than one language, especially Spanish and Portuguese, he said.

“We’re seeing a steady increase in the number of arbitration clauses stipulating that arbitration is in both Spanish and English.”