More on Amended AAA Commercial Rules

This article first appeared on the Securities Arbitration Alert Blog, here.

Just as we were putting SAA 2022-33 (Sep. 1) to bed came word that the AAA had revised its Commercial Arbitration Rules and Mediation Procedures, effective September 1. We ran a Short Brief in # 33, and promised a more thorough analysis in this Alert.

We draw heavily from an August 29 email to panelists from Vice President for Panel Relations Cindy Rumney, as well as AAA’s posted summary of the key changes.

Why the Changes?

“The amended AAA Commercial Rules and Mediation Procedures, effective September 1, 2022, represents a two-year endeavor by an internal AAA working group, with contributions from the AAA’s case-management and administrative groups, party surveys, arbitrators, and the Law and Practice and LCC Committees of the AAA-ICDR® Council.[] The amended rules standardize important longstanding AAA practices—confidentiality, consideration of consolidation/joinder motions, and civility—as well as revise rules to further promote efficiency, reflect advances in technology, and include where appropriate discussions regarding cybersecurity.”

New Sections

New rules include (ed: repeated verbatim):

• Consolidation: AAA’s first-ever commercial rule for the consolidation of existing arbitrations or the joinder of additional parties
• Confidentiality: Captures the long-standing requirements of the Code of Ethics for Arbitrators by including a commitment to the confidentiality of arbitration in the Rules
• Conduct of parties and their representatives: Specifically incorporates into the Rules the AAA’s expectations of civility and professionalism of all participants in arbitrations
• Providing arbitrators with the authority to interpret awards: Draws upon the recently adopted ICDR article that allows the arbitrator to explain the award on a party’s motion
• The importance of cybersecurity, privacy, and data protection: Reflects the weight that the AAA places on cybersecurity and recommends that data protection be discussed in the preliminary hearing.

Other Changes Worth Noting

Other key amendments include (ed: repeated verbatim):

• Expanding arbitral authority to determine the method of proceedings
• Building on lessons learned from the COVID-19 pandemic, certain Rules now give the arbitrator the express authority to compel the use of video or electronic means for some or all of the hearing.)
• Adjusting the dollar thresholds for application of the Expedited Procedures and Large, Complex Commercial Disputes Procedures
• Strengthening limitations on motion practice and discovery in the Expedited Procedures
• Updating the rule on stenographic records to include a broader definition of transcription
• Increasing the dollar threshold for a three-arbitrator panel.

(ed: *These are the first substantial amendments in several years. As far as we can tell, the last amendments were in October 2013. **We assume they were effective for cases filed on and after September 1. ***Click here for a detailed, section-by-section, analysis of the key changes.)

George Friedman

George H. Friedman is the publisher and Editor-in-Chief of the Securities Arbitration Alert, a weekly online publication covering the latest developments in financial services arbitration and mediation. He is also the principal of George H. Friedman Consulting, LLC, providing expert advice on arbitration and mediation in general and the FINRA…