American Arbitration Association Acquires ODR.com and Mediate.com to Expand Online Dispute Resolution

In a move designed to expand its products for online dispute resolution, the American Arbitration Association has acquired ODR.com, a company that builds ODR systems, and its parent company, Resourceful Internet Solutions Inc. (RIS), which also owns Mediate.com, Arbitrate.com and Ombuds.org.

The companies said that the immediate focus of the alliance will be on expanding AAA’s mediation services by developing a suite of ODR products.

“Demand for ODR is growing rapidly worldwide, and working with the AAA will keep us on the cutting edge,” said RIS CEO Colin Rule. “Our shared goal is to make ADR an accessible choice for everyone, and this alliance will enable us to achieve that goal at an unprecedented level.”

The acquisition comes 18 months after the AAA, the largest private provider of alternative dispute resolution services in the world, named Bridget Mary McCormack, the former chief justice of the Michigan Supreme Court, as its president and chief executive officer.

As I noted in January when McCormack was a guest on my LawNext podcast, she is credited with having “supercharged” the AAA’s innovation efforts – particularly with regard to its adoption of generative AI.

Similarly Rule, the RIS CEO, has long been recognized as a trailblazer and innovator in the field of ODR. In the early days of the internet, he founded Online Resolution, one of the first ODR sites, and then, from 2003 to 2011, he was director of ODR for eBay and PayPal.

In 2011, he co-founded Modria.com, an ODR technology developer whose platform was used by a number of e-commerce sites and innovative sites designed to provide alternatives to litigation. Modria was acquired in 2017 by Tyler Technologies, a company that develops software products for courts and governments. Rule remained with Tyler as vice president of ODR until 2020, when he cofounded and became president and CEO of ODR.com and RIS.

McCormack said that ODR.com is the leading technology company in mediation and arbitration and has the software and experience to build ODR systems at any scale.

“The RIS team is led by pioneers in technology and dispute resolution,” she said. “They have designed and launched the largest and most successful ODR systems globally, including those at eBay and PayPal, which have resolved hundreds of millions of disputes.”

ODR.com will remain a separate for-profit subsidiary of the AAA dedicated to providing technology and artificial intelligence to the ADR community. Rule will remain president and CEO, reporting to McCormack.

“Together, we’re creating something greater than the sum of our parts,” McCormack said. “This alliance empowers us to dramatically expand our products and services to reach new and underserved markets globally.”

‘ODR Is A Big Term’

In an interview with yesterday ahead of today’s announcement, McCormack and Rule shared more information about the acquisition and its implications for dispute resolution.

“Over the last nine, ten, twelve months, the AAA has been pretty aggressive about working to update, upgrade, and grow our core products and services, our core business, but also at the same time wanting to figure out how we can reach new users in new markets,” McCormack said. “I think what Colin and his team are doing at ODR.com is going to allow us to do that a lot faster and with a lot more agility than it’s easy to do on our own.”

The scope of that expansion is likely to encompass ODR in all its forms, from arbitration and mediation, to ombuds services, and beyond, McCormack and Rule said.

“ODR is a big term that can mean a whole lot of different things, and that’s a good thing because we want it to be able to mean whatever our users want,” McCormack said. “We see lots of new verticals for us to provide services in, and we have lots of current customers who might want traditional arbitration services for some of their disputes, but something lighter, faster, more efficient for other disputes.”

Rule sees opportunities for the AAA to expand its ability to serve high-volume, low-value civil cases.

“I’ve done a lot of work with family and landlord-tenant and small claims and e-commerce, and that’s not been traditionally AAA’s focus,” Rule said. “But I love what Bridget said earlier, that ODR is all of the above. For me, ODR is the future of ADR – it’s just ADR plus technology. So I love it all – I love transformative mediation, evaluative mediation, ombuds, coaching, early neutral evaluation. Let’s do it!”

Both emphasized that ODR.com will continue to operate independently, but that they will also share resources and talent, particularly with regard to the development of new AI-driven applications. “We will do whatever makes us stronger and however we can move faster,” McCormack said.

The Future of ADR

In 2016, Rule and I presented a panel at ABA Techshow (which the ABA Journal covered in this report), during which we talked about the slow-ish pace of adoption of ODR among legal professionals – as opposed to its rapid adoption by e-commerce companies such as eBay. In our conversation yesterday, I asked him about his perspective on the state of ODR today.

He suggested that ODR has become so woven into the fabric of law and commerce that it is not even thought of as something unique.

“ODR is really just a use of technology to help people solve problems,” Rule said. “And every customer center, every call center, is doing that, and every courthouse is doing that. Whether or not they term it ODR, I think, is beside the point. ODR is the future of ADR.

“Technology is transforming the law, it’s transforming the justice system, just like it’s transformed medicine and finance and entertainment,” he continued. “I think the relevance of this deep well of theory and research and experience that we’ve developed in the ODR field that’s going to inform us as AI takes a greater role. … That’s the way that you get sustainable technological innovation – doing it over the long term and figuring out what works and figuring out what doesn’t work.”

McCormack added that, while Michigan chief justice, she helped bring about access to ODR across all of the state’s judicial districts. She sees ODR as having the potential to have huge impact on access to justice.

“I don’t know why courts wouldn’t want to send many of their largest dockets to a more user-friendly resolution system,” she said. “So I think ODR is really promising for court adjacent work.”

Radical Collaboration

For Rule, one aspect of the acquisition that particularly excites him is the ability to combine AI technology with the deep wells of data that the AAA has accumulated over its 100 years of existence.

“I think it’s going to allow us to have a step-function increase in access to justice,” he said. “It’s not going to be a gradual 1 or 2% per year. … Over time, building out these tools in line with the best practices and ethical guidelines we have in the field, I think this is going to be a hugely positive thing.”

Both McCormack and Rule also emphasized the ongoing importance of collaboration and partnerships beyond their newly merged organizations.

“We need to partner,” Rule said. “We need to partner with lawyers, with law firms, with courts, with dispute resolution service providers, and with businesses to envision solutions that are going to work for them. So I think you’re going to see a lot of me and Bridget out there, because we need to be talking to lots and lots of people. We don’t have the smarts to design all of this stuff. We need to bring in collaborators.”

“I feel like I found my spirit animal in Colin,” added McCormack. “I mean, I’ve been talking about how radical collaboration is the only way to lead us through what’s coming next for the business of law, the practice of law, and dispute resolution.”

That includes some exciting collaborations she cannot yet talk about, she said. “We are really thrilled for what comes next.”