2007
INTRODUCTION
The litigation process has been characterized as lengthy, costly, and excessively formal.(fn1) As a result, parties have become increasingly eager to settle their disputes outside the courtroom through various forms of alternative dispute resolution (“ADR”).(fn2) Arbitration, a form of ADR in which judges are selected to preside over informal hearings, often proves to be economical and less time-consuming than litigation.(fn3) By creating arbitration provisions, parties to a contract can attempt to control the process and costs of any future controversies.(fn4) However, if a dispute arises, and one or both parties fail to comply with the terms of the arbitration provision, courts may have difficulty determining whether state law or federal law should govern arbitrability.(fn5)
In Kruger Clinic Orthopaedics, LLC v. Regence Blueshield,(fn6) the Supreme Court of Washington invalidated the arbitration provision between Kruger Clinic Orthopaedics (“Kruger”) and Regence Blueshield (“Blueshield”) under the Revised Code of Washington § 48.43.055 (“RCW”) and the Washington Administrative Code § 284-43-322(4) (“WAC”).(fn7) The court also invalidated the arbitration provision between Tacoma Orthopaedic Surgeons (“Tacoma”) and Blueshield under the same Washington statute and regulation.(fn8) The Kruger-Blueshield arbitration provision mandated binding arbitration of any dispute, while the RCW and the WAC prohibited parties from requiring binding arbitration to the exclusion of judicial remedies; however, the RCW and the WAC allowed arbitration prior to judicial remedies.(fn9) The Tacoma-Blueshield provision, however, did not compel binding arbitration to the exclusion of judicial remedies.(fn10)