CPR: Your Guide To Using ADR Most Effectively

Tuesday, August 13, 2013 - 11:38

The Editor interviews Daniel E. Troy, Senior Vice President, General Counsel, GlaxoSmithKline (GSK).

Editor: Why is ADR important to GSK, and how have you incorporated it into your law department’s culture?

Troy: We have way more disputes than we’d like to have in the pharmaceutical sector. We get sued as much or more than many other industries, and we have issues that come up as much or more than many other industries. In general, one of the things we’ve discovered is that these things almost always tend to get worse. They don’t tend to get better. So, the more quickly you can resolve the issues and find creative ways to address them, it tends to work out better for all stakeholders involved.

If there’s somebody with a valid claim, they want to have that claim addressed as quickly as possible, and it should be addressed as quickly as possible. If the claim is not valid, it is also important to get rid of it quickly. From our perspective, if there are valid claims out there, we want to address them, and if they’re not valid, just having them hang over the company doesn’t help us. That doesn’t mean we cave all the time, but thinking of this outside the context of resolution in the court system and thinking of alternative ways to address and avoid disputes is absolutely critical to avoiding the kinds of major distractions that have too often besieged our industry.

Editor: GSK is a Founding Signatory of CPR’s 21st Century Pledge. Why did you make this commitment?

Troy: Because we think it’s the right thing to do. We really want to be systematic about approaching ADR, and we want to be public about our commitment and to encourage others to be public about their commitment. Many parts of the U.S. justice system are broken, and there needs to be an alternative mechanism to fill that void. ADR is an important part of filling that void.

Editor: Why is it important to systematize ADR into the GSK legal practice?

Troy: We see so many disputes, and we don’t want to approach them on a one-off basis. We want it to be systematic. We want to have a process. We want to have a standard way of approaching things, and we want to have it deeply embedded. It’s nice to make a public commitment, but what you really need to do is operationalize it, enforce it, and drive it through the organization. You do that by being public in your commitment and by establishing processes. We call this our MASTER program, which stands for Maximizing Savings Through Early Resolution. We implement this by doing early case assessments and litigation risk assessments. All of these things work together to create a culture to prevent claims from becoming crises.

Editor: How has CPR supported GSK in its efforts to incorporate ADR into its systems and practices?

Troy: It’s always helpful to sit down with others who are like-minded and thinking about the same thing. It’s always helpful to have access to great expertise in a field. It’s helpful to have standard rules that others will follow. CPR provides all those different things.

Editor: Why is it important for others to support CPR?

Troy: It’s a great and an important organization in that it is addressing a profound need in the American justice system. It has helped change the culture of ADR among corporate America’s legal departments. The more accepted arbitration and mediation or ADR become, the better it is for everyone. One of the reasons the American justice system is broken is because it’s overloaded – particularly in the state courts, where there are all sorts of budget cuts. The justice system is more stressed than ever, and CPR provides a terrific alternative to that.

Editor: GSK received CPR’s 2011 Corporate Leadership Award. What did it mean to GSK to be a Corporate Leadership Award winner?

Troy: We were very honored that there was some public recognition of achieving the goal of efficiently managing and resolving disputes. It represents a lodestar that we remember. It reinforces and further strengthens our determination to use ADR wherever appropriate and our commitment to it.

Editor:  What impact did it have on your team?

Troy: It dramatically reinforced, particularly for team members outside our country, the knowledge and awareness of the company’s commitment to ADR. One of the things we’ve tried to do, and the CPR award certainly helped, is embed the idea of an early aggressive approach to dispute resolution not just in the United States but in other places as well.

Editor: Did you want to comment on the practice areas that might be involved?

Troy: We sensitize lawyers in all practice areas in the law department to the need to get an early handle on situations that might materialize into litigation and encourage them to explore some other way of addressing these situations such as the use of ADR.