The Intriguing Evolution of ODR

July 10, 2019 by Colin Rule

The Intriguing Evolution of ODR

Online Dispute Resolution (ODR) has become a hot topic in the courts over the past few years, but ODR has been around for a lot longer than that. The history of ODR reaches back into the early days of the internet. U.S. courts are now deploying ODR tools and techniques that have been refined through the resolution of more than a billion disputes around the world over the last 25 years.

Disputes are Human

Dispute resolution is a natural component of human interaction. All societies and human social groups (including both families and nations) need to have effective and fair ways to resolve disputes that arise.

There are detailed records of dispute resolution processes in Sumeria (1770 BC), Rome (1 AD), and medieval England (1440 AD). Because they are made up of people, online environments are no different. It is clear that we need a justice system for the internet.

The Early Days of ODR

In their pioneering book, Online Dispute Resolution (2001), Professors Ethan Katsh and Janet Rifkin broke the early development of ODR into three different stages.

  1. The first, which they say lasted until about 1995, consisted of specialized dispute resolution in specific contexts. (The first use of the term “online dispute resolution” was at a conference hosted by the National Conference on Artificial Intelligence Research (NCAIR) in Washington, DC in 1996).
  2. The second period coincided with the growth of the internet, particularly as a medium for commerce.
  3. The third period, which began around the turn of the century, was when commercial entities began to show interest in online dispute resolution.

That was when things really started to take off.

eCommerce Roots

Most face-to-face dispute resolution, like family and community mediation programs, arose from grassroots initiatives at the local level. The community mediation movement in the 1970s (built on the foundation of labor-management dispute resolution from the 1950s) eventually convinced U.S. courts to integrate voluntary mediation into their services on a county-by-county basis.

The growth of ODR happened in a different way: it was global first. At the end of the ‘90s, the internet began to create large numbers of low value, high volume disputes, particularly in eCommerce.  Governments quickly realized that there needed to be new systems to handle these online disputes.

Courts, bound by geography and jurisdictional rules, are not designed to resolve these cross-border cases efficiently and effectively. Large internet intermediaries like eBay and PayPal realized they needed fast and fair resolutions to increase trust among users to convince them to buy things online. To that end, they invested tens of millions of dollars in building ODR tools from scratch. This led to a boom in ODR starting around 2000.

Rapid Growth and Governing

In June of that year, the United States Department of Commerce and Federal Trade Commission convened a conference in Washington to discuss ODR for eCommerce. The conference attracted more than 300 attendees from the dispute resolution field, including business, non-profits, and government. That gathering marked the beginning of a real ODR movement in the United States. A few months later, the first conference among ODR service providers took place in Phoenix, Arizona. For the first time, all the major providers of ODR services discussed their agenda for the field and the plan for future growth.

ODR’s acceleration has hardly slowed in the 20 years since. There are now more than a hundred ODR providers around the world. More than a billion disputes have been resolved through ODR tools. UMass-Amherst hosts the National Center for Technology and Dispute Resolution, which serves as the hub for ODR information and scholarship.

The International Council for Online Dispute Resolution promotes standards for quality ODR. UNCITRAL, the United Nations agency responsible for harmonizing global laws, convened a Working Group to explore ODR, eventually issuing a final report urging governments and judiciaries to expand global availability of ODR for consumers. The European Union adopted a Regulation on Online Dispute Resolution for Consumer Disputes, which took effect in January 2016 and requires all merchants in EU member states to inform their customers about the availability of ODR on their websites and in email communications.

ODR in Courts

These are just a few of the many developments pushing ODR forward – and now, Modria is bringing cutting-edge ODR to the courts. Modria is working on dozens of county and statewide court ODR implementations in the U.S. this year, and it is almost certain that the number will grow even bigger in 2020. Modria is also introducing court ODR programs in countries like the United Kingdom, Australia, New Zealand, Brazil, and Canada. While these programs may be new to many in the global justice community, their roots go all the way back to ODR’s origins in the early days of the internet. What’s more, if ODR’s past is an accurate predictor of the future, more innovations and breakthroughs are waiting just around the corner. ODR has come a long way, but I suspect we may still be at the beginning of the story.

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