.

In mediation, the mediator may ‘give advice, make assessments, state opinions – including opinions on the likely court outcome, propose a fair or workable resolution to an issue of the dispute, or press the parties to accept a particular resolution.

Two of the well-known mediation platforms are reviewed and compared for you. When comparing smart settle and SquareTrade, one can conclude that for complex mediation, SmartSettle is the best option. For simple mediation cases, SquareTrade was the better option.

To learn and read more about mediation and online dispute resolution, Key Issues for Successful Online Mediation, and What Do We Need to Know About ODR?.

Online Mediation Approach

The mediators must determine which strategy is most suited for the conflict at hand at the start of the mediation. When there is a power imbalance between the parties (B2C), some form of direction appears appropriate, but the situation may be different in other circumstances (B2B or C2C). In traditional e-commerce disputes, mediators often use an evaluative approach, concentrating on identifying the root of the problem and establishing conditions using fair criteria. Instead of seeking new ideas through brainstorming approaches, which take more time and costs more money, agreements may be made under these conditions.

SmartSettle and SquareTrade (Two ODR Examples)

Complex mediation: SmartSettle

SmartSettle is a privately held firm in Canada that provides ODR services. It offers an online negotiating tool based on algorithmic analysis to help parties resolve complicated issues. This ODR service also supports face-to-face and online mediation sessions. ¹⁹ SmartSettle works as a go-between for the parties, aiding them in settling their disagreements. It requires the parties first to identify the topics in dispute and rank them in order of importance by assigning a nominal value to each issue. The algorithm analysis then generates several suggestions to assist the parties in reaching the most efficient resolution.

SmartSettle employs game theory approaches to achieve the best possible result. SmartSettle is a six-step method in which parties communicate the value of their preferences with the aid of an impartial facilitator. ²⁰ The six steps are as follows:

1. Preparation: the ODR process is described, and the parties agree to follow the SmartSettle principles.

2. Identify the problems in the disagreement: parties must first identify the issues in the conflict.

3. Quantity satisfaction: both parties assess their needs and their worth.

4. Determine equity: The program generates settlement packages depending on the preferences of the parties.

5. Maximize benefits: the program keeps suggesting fresh, better settlements, even if the parties’ initial minimum is agreeable.

6. Secure commitment: The framework for agreement is signed by both sides.

Because it may support multi-party negotiation scenarios with any number of quantitative or qualitative concerns, SmartSettle has been dubbed the “bridge” between online mediation and software aid.

Nonetheless, for most B2C disputes, this technique may be challenging and time-consuming; however, it is more cost-effective when settling complex and high-value disputes (B2B). On the one hand, SmartSettle has a lot of promise since it provides mathematically optimum answers to disputes, but on the other hand, this ODR platform may be challenging to use at first.

As a result, SmartSettle recommends that disputants work with a human mediator who is in charge of running the program. As a result, this is not an insurmountable barrier. Indeed, as this sort of technology becomes more user-friendly, it is expected to disrupt the ODR market by allowing it to be used to more common consumer conflicts.

More about Smarsettle here.

Key issues with Smartsettle as an online mediation tool

One of the options in smartsettle is utilizing secret settlement offers which are guided by the algorithm. However, this opens the door for this experience with the platform to “game” the algorithm. This is based on the algorithm “looking” into the shared risk between the parties and as evident from the secret settlement proposed by each one and then rewarding the party that lowered its offer for settlement earlier.

To elaborate more, a disputant using the online mediation tool may start the settlement process with a very high offer which is then followed directly by a lower offer. This will result in the disputant gaining the early effort-reward set by the algorithm!

Simple Mediation: SquareTrade

SquareTrade has been the most popular online dispute resolution service for B2C disputes to date. It aided eBay customers in addressing their problems.

SquareTrade, however, decided to discontinue addressing eBay feedback complaints in June 2008 due to changes in the eBay feedback system that occurred in May 2008. SquareTrade, PayPal, and their dispute resolution new partners, such as NetNeutral for eBay Motors, appear to have been taken over by eBay.

This part will continue to look at SquareTrade, which provided online mediation services successfully for several years.

SquareTrade used a procedure in which a mediator aided disputants via asynchronous e-mail and online conversations with the parties to resolve minor value disagreements. Around 200 mediators from over 15 countries worked with SquareTrade.

The job of the online mediator was similar to that of the offline mediator in that he oversaw the process, identified the parties’ underlying interests, and guided them to a mutually agreeable settlement. The mediator wrote the memorandum of understanding once the disputants reached an agreement, and both parties clicked “I accept.”

SquareTrade ODR software was created to settle disputes originating from online transactions, including feedback issues from eBay; it was created on the fly to address specific disputes. The benefit of eBay disputes is that the great majority of them revolve around a small number of issues, such as when an item purchased on eBay arrives late or does not match the description, and so on.

Another benefit is that eBay disputants have built-in incentives to resolve their disagreement as fast as feasible. The buyer is looking for monetary compensation, while the seller is looking for favorable feedback. Furthermore, the majority of eBay conflicts are specialized problems that cannot be resolved offline.

1. SquareTrade’s primary flaw was that it relied solely on textual interactions, which were performed individually with each partner.
2. SquareTrade did not employ video communications, which would have given online mediation a new dimension.
3. SquareTrade has a restricted vocabulary and only dealt with a limited number of issues.

Despite this, we should give SquareTrade credit for claiming an 80% success rate in online mediation, with the typical dispute being settled in two weeks. SquareTrade mediation was accessible in five languages, and it helped parties from over 120 countries resolve over 2 million conflicts.

Whether SquareTrade used advanced ODR software or not is debatable. What is undeniable, though, is that SquareTrade software employed a pattern-recognition algorithm. Assisted parties in using the internet to resolve their issues without imposing a solution against one of the parties’ wishes.

MODRON – ODR Platform and online mediation tool

MODRON has been launched in 2013 in Sydney, Australia as an online dispute resolution platform. They undertake various ODR procedures such as online arbitration, online mediation, negotiations, and online case management.

We have not tried the platform personally, however, various reviews refer to their system incorporating features crucial for successful online dispute resolution such as audio/video conferencing, audio/video recordings, secure file sharing, messaging, scheduling and billing.

Benefits and limitations of online mediation

Traditional mediation benefits and challenges are enhanced by online mediation. Online mediation, like conventional mediation, allows the mediator to tailor the procedure to the disputants’ specific requirements. 

Online mediation has several advantages.

• When compared to the expense of settling a dispute in a traditional venue, online mediation is less expensive. The benefit of avoiding travel expenditures allows online mediation to be used for e-commerce and low-value conflicts with no other choice.

• For many disputants, internet mediation, has the potential to improve access to justice.

Drawbacks of Online Mediation

Similar to the disadvantages of ODR, some of the cons of online mediation include (not exhaustive, just a few examples – More about mediation in mediation :

• Confidentiality risks due to using third party applications.
• an inability for technology to handle the varying complexity of legal cases.
• difficulty for the advocate, arbiter and mediator in building rapport with parties.
• Disadvantages of not appearing in person especially in reading body language.
• Lack of human emotions (insight and empathy)
• disadvantages for those who are not capable and are not acustomed to using online dispute platforms.
• the possibility of algorithmic bias.

You may read about family mediation and expected expenses in Family Disputes Mediation: Resolving Inheritance, Business, Property Conflicts, and More.

Conclusion

SmartSettle (and SquareTrade) is a powerful tool that addresses customer service issues quickly and effectively. The Transformative Approach in mediation seeks the empowerment and mutual recognition of the parties involved in mediation. Therefore, Online mediation has the potential for increasing access to justice for many disputants.

The post Example of Online Mediation Provider- SmartSettle as an Online Mediation tool. appeared first on ODR Guide.

Successful online mediation requires trust, privacy, and a willingness to comply.

It is often thought that one of the most essential reasons mediation can be successful is because of the face-to-face contact between the parties and the mediator.

Mediators are supposedly experts at reading body language, but there is no face-to-face contact with online mediation.

The mediator obviously needs to possess other skills besides that of reading body language. Offline mediators are trained to help people tell their stories and manage the mediation sessions’ conversational process.

They are trained to remain impartial, summarize, and reframe.

They use techniques of active listening and are experts in agreement writing, but not all of these skills are equally suitable for online mediation. With online mediation, there are many skills essential for making it successful. Let’s take a look at the key issues for online mediation.

For more on Online Dispute resolution, What is ODR (Online dispute resolution) ?

This article is extracted from “ ONLINE DISPUTE RESOLUTION AS A SOLUTION TO CROSS-BORDER E-DISPUTES – AN INTRODUCTION TO ODR” by Esther van den Heuvel.

Trust

An essential aspect of mediation, whether online or offline, is trust. A good mediator must be able to establish trust between himself and the disputing parties. In face-to-face mediation, this trust is established during the mediation sessions. With online mediation, this trust can be far more challenging to establish, although no less important.

Offline mediation often takes place between parties who have an ongoing relationship and history together. The mediator can use information about their history for everyone’s benefit.

Their common goal is to reach a solution that will be acceptable to both parties and will not damage the relationship any further. This is important to both of them.

In the online mediation process, parties often do not know each other and do not have an ongoing virtual or real-time relationship of any kind. The parties have been involved in an electronic commerce transaction, in a consumer/merchant relationship (onlinemediators.com), or a consumer/consumer relationship (eBay.com).

In most cases, these parties have not had dealings with one another before the dispute. The mediator can not draw on the relationship or ask about the background of the dispute in relation to previous interactions between parties because there have not been any.

The fact that there is no face-to-face contact, but communication takes place via e-mail or real-time online makes it difficult for the mediator to manage or temper the tone of the interactions or use his skills in reading body language. It is, therefore, far more challenging to establish and maintain trust.

Identity and Digital Signatures

There are several trust-related problems where online transactions and online mediation are concerned. First, the identity of the person being dealt with is not always clear. How can you be sure the person is who they claim to be? Here, digital signatures can play an important role.

There EU legislation in the form of a directive was implemented in all EU member states in 2001. In the U.S., on June 30, 2000, President Clinton signed into law the ‘Electronic Signatures in Global and National Commerce Act,’ which became active on October 1, 2000.

This act gives a signature or record sent through cyberspace the same legal validity as a pen-and-paper document. The fact that a digital signature and digital records have the same legal validity as written documents makes it far easier to check someone’s digital identity.

In fact, it might well prove more difficult to falsify digital signatures than written signatures. A digital signature is an authentication method that uses public-key cryptography.

The digital signature plays an essential part in ensuring the authenticity, integrity, and non-repudiation of data communication, thus enhancing trust.

Data Security and Confidentiality

How can you be sure that the data being sent and received has not been tampered with, and how can you be sure that no unauthorized third parties have access to the information? 

Here again, encryption plays an important part in ensuring confidentiality and data security. Encryption makes it possible for the mediator and the parties to communicate without the risk of unauthorized third parties having access to their communication, thus creating secure data communication.

For a mediation procedure to be successful, confidentiality is essential. In an offline mediation procedure, confidentiality is not really a problem.

Most communication is oral; transcripts of conversations are usually not made. Any written documents that do exist only circulate in a very small group of people.

This is different from online communication. First of all, communication takes place in written form over insecure networks. To transfer the data over the internet, there are numerous temporary copies made along the way. This is inherent to the nature of the internet.

It is necessary to make copies on the routers when transferring data from one computer to another and to make copies when downloading or uploading information.

In cyberspace, communication takes place through constant copying. This is something of which the mediator must be aware.

He must take all possible precautions to ensure that ( automatic ) backups are kept no longer than necessary and are not accessible to unauthorized third parties. Even these precautions do not guarantee complete confidentiality.

The only way to protect data and guarantee confidentiality is through encryption. Encryption is the automated process of making data inaccessible to unauthorized people by means of an algorithm and a key.

Decryption is the reverse process. A popular method to guarantee confidentiality is the so-called asymmetric cryptosystem: this system uses two different keys (a public and a private key) for encryption and decryption of data. This means that without the right key no one can read the message.

The key, needed to read the message, is sent to the recipient separately from the message and reaches him by another route than the message.

When confidentiality has been guaranteed by means of encryption, the fact that the internet is built up from copies also has its advantages.

The complete written file is accessible to both parties and to the mediator at all times if they need to check certain details or to see how things are. It is not necessary to take notes because everything is already written down.

Privacy

Another important issue that needs to be addressed in online mediation is privacy.

Where privacy is concerned, parties should be made aware of the ways their privacy is protected and how personal information is stored or used by the mediator or mediation company.

It is imperative that the mediator or the mediation firm have a privacy policy that addresses a number of issues.

Any dispute they receive via a website must be treated in accordance with the rules of confidentiality. The disputes must be known only to the parties involved in the dispute, including the mediator.

All personal data must be recorded and used with great care. By making strategic use of security possibilities, it is possible to guarantee that the personal privacy of all parties involved in an online mediation procedure is respected. Here again, encryption plays a key role.

In a privacy policy, parties must also be made aware that the mediation site will probably make use of cookie technology. They need to be told that if they do not want any cookies to remain on their hard disk, they can use their browser options to switch off the cookie technology.

There are several privacy policy generators on the internet that can help the mediation organization make its own privacy policy. For example, since August 2000, the OECD Privacy Policy Statement Generator has been made available.

In The Shadow of the Law

Another important aspect of offline mediation, and indeed for ADR in general, is it always takes place ‘in the shadow of the law.’ This means that the disputing parties trying to find a solution through alternative dispute resolution are aware of the legal rules governing the area of their dispute.

The outcome that the law will impose if no agreement is reached gives each party a reasonably good idea of its bargaining position. Parties will take the law into consideration when setting out a strategy in the ADR procedure.

For e-disputes there is the problem that it is not obvious what law applies, especially with cross border e-disputes.

In his article ‘Governing Cyberspace,’ David Post writes: “There are, appropriately enough given the binary nature of the information traveling in cyberspace, two radically different processes through which order can emerge in this environment…. [One] involves an increasing degree of centralization of control, achieved by means of increasing international coordination among existing sovereigns, through multilateral treaties and/or the creation of new international governing bodies along the lines of the World Trade Organization, the World Intellectual Property Organization, and the like. If the choice of law is hopelessly confusing, in other words, we can eliminate the choice by imposing a single, uniform legal standard worldwide.

“[The other] invokes a radical decentralization of law-making, the development of processes that do. Some of these decentralized processes will look familiar to us as a kind of ‘electronic federalism.’ In this model, individual network access providers, rather than territorially-based states, become the essential units of governance; users in effect delegate the task of rule-making to them – confer sovereignty on them – and choose among them according to their own individual views of the constituent elements of an ordered society. The ‘law of the internet’ thus emerges, not from the decision of some higher authority, but as the aggregate of the choices made by individual system operators about what rules to impose, and by individual users about which online communities to join. Mobility – our ability to move unhindered into and out of these individual networks with their distinct rule-sets – is a powerful guarantee that the resulting distribution of rules is a just one; indeed, our very conception of what constitutes justice may change as we observe the kind of law that emerges from uncoerced individual choice.“

In the eBay project that I describe below, researchers from the University of Massachusetts concluded that the context of the dispute resolution system provides the relevant “law” that will encourage parties to participate in online mediation and make sure they comply with the outcome of the procedure.

This is consistent with the second process the Post describes. For more on ODR advantages and disadvantages, Online Dispute Resolution: The Advantages and Disadvantages

The eBay ODR Experiment and the Shadow of eBay Law

At the end of 1998, eBay, the largest auction site in the U.S., approached researchers at the University of Massachusetts to conduct a pilot project in order to find out whether online dispute resolution could be a useful means of solving problems occurring on their site.

The researchers began their project in 1999, choosing mediation over arbitration because of the voluntary nature of mediation. The researchers wanted to ascertain how effective an online mediator could be without face-to-face meetings.

The eBay experiment showed that the number of disputants willing to participate in online mediation was 75% whereas in other experiments with offline mediation the number of participants willing to participate was around 50%. In all instances, mediation was explained to be a voluntary process.

The reason so many eBay users were willing to participate was not so much the wish to reach a mutually acceptable outcome, but rather the wish to continue using the eBay site in the future. eBay is a virtual marketplace where buyers and sellers meet.

Public safety is therefore very important and is achieved through several means, among which a ‘feedback rating system’ is the most important.

After any transaction is completed, buyers and sellers can post feedback as to the conduct of the buyer or seller. If you wish to buy an item, you can easily check the feedback rating of the seller before you bid on an item. If you find a possible buyer, you can check his rating also.

It is therefore very important to eBay users to acquire a positive feedback rating if they wish to remain active on the eBay site.

Taking part in a voluntary dispute resolution service can help both buyers and sellers to keep a good rating. This means their future in the eBay marketplace will be safe, which is important to them.

The Massachusetts researchers stated that mediation on the eBay site takes place in the ‘shadow of eBay law.’ The ‘eBay law’ is the ‘law of the internet’ mentioned above by Post.

It emerged as the aggregate of the choices made by eBay as the individual system operator about what rules to impose, and by the eBay-users in choosing to join the eBay community.

Compliance

Another important issue for online mediation, and one closely linked with the concept of the shadow of the law, is compliance.

How can you be sure the other party will comply with the outcome of the dispute resolution process? Offline mediation compliance is high because the mediation agreement that is usually the outcome of the process can be made legally binding according to the applicable law.

As the researchers found out in the eBay project, compliance with the result of an online mediation procedure was high because of ‘eBay Law.’ The party that ‘lost’ did not want to jeopardize his or her position in the eBay community and was therefore willing to comply with the outcome.

The researchers also noted that if a virtual marketplace chose online arbitration or some other form of binding rulings, compliance could be achieved by using the threat of exclusion from the virtual marketplace.

This of course would be another form of the ‘law of the internet’ and would also assure compliance with the outcome of the dispute resolution procedure.

Where binding advice is used in offline consumer complaint resolution, the same mechanism of the threat of expulsion is used to achieve compliance from companies.

In the eBay experiment, it proved not necessary to obtain a writ of execution to achieve compliance. The Squaretrade initiative, which resulted from the eBay experiment, uses the same basis of people not wishing to jeopardize their position in the eBay society.

The online mediator initiative is not restricted to e-commerce transactions; parties can either accept the outcome as it is or assure compliance by making the outcome legally binding in a contract.

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