February 24, 2015
Arbitration is sometimes touted as less expensive and less risky for businesses than traditional courtroom litigation, especially when it comes to consumer disputes. But disgraced cyclist Lance Armstrong’s most recent legal loss exposes some of the risks that face those who elect to arbitrate their disputes rather than go to court.

The Armstrong arbitration award – which ordered Armstrong to pay $10 million in sanctions – shows how arbitration panels can resort to sometimes creative reasoning to reach a result that arbitrators feel is just. And with virtually no recourse to overturn these questionable arbitration awards, businesses – and Armstrong – may be left on the hook for millions of dollars in damages.

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