Arbitration, in addition to mediation, is one of the most common methods of alternative dispute resolution (“ADR”), whereby the parties bring a business dispute before a disinterested third party who is typically selected by both parties. The third party, an arbitrator, hears the evidence brought by both sides and makes a decision. Rather than taking place in a courtroom, the evidence is usually presented in the arbitrator’s conference room and is somewhat less formal than a courtroom proceeding. In most cases, the arbitrator’s decision is binding and final. As with all types of ADR, the general concept allows the parties involved to resolve their issues outside of federal or state courts, avoiding potentially long and costly trials.

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