Umberg urges bar to use new ADR oversight powers

State Sen. Tom Umberg wants the California State Bar to take advantage of a new law he wrote that could give it oversight of arbitrators and other alternative dispute resolution providers. The chair of the Senate Judiciary Committee also thinks he has some influence with the bar.

"I think the bar is amenable to it," Umberg told Mattie Robertson, deputy director of the Center for Negotiation & Dispute Resolution at UC Law San Francisco during a webinar sponsored by the California Lawyers Association on Monday. "If the bar is not amenable, I'm carrying the bar bill this year, so I'll help to make them amenable."

Umberg, D-Santa Ana, was speaking about a law he brought to passage by the Legislature this year, SB 940. It allows the State Bar to create a voluntary registration program for arbitration providers.

He said the bill was inspired by revelations that now-disbarred Los Angeles attorney Tom Girardi embezzled millions of dollars from clients, despite dozens of complaints to the bar over 40 years. Umberg said that one of the ways Girardi hid his thefts was by running his cases through arbitrators who did not track the plaintiffs' money very closely.

"This is the first time in my legislative career where people in the general public actually asked me about what's going on with the bar," Umberg said during the webinar: "New Regulation of the ADR Process in California: An Interview with Senator Tom Umberg on the Aims and Workings of SB 940."

He added that arbitration has only become more popular in the years since news of the Girardi scandal broke, increasing the need for oversight.

"It's an increasingly common mode for dispute resolution," Umberg said. "It's my view that it is becoming more akin to actually having disputes resolved in court, and so you should have an opportunity to know who your decision maker is."

"The State Bar Board of Trustees voted to support SB 940 in July 2024 and have been discussing the details of its structure with Senator Umberg's office throughout," the bar said in a statement shared by spokesman Rick Coca. "We very much look forward to designing and implementing a voluntary alternative dispute resolution certification program in the months to come."

Umberg also addressed changes made during the legislative process -- notably to excuse mediation from disclosure provisions. Unless they have signed an agreement saying otherwise, he said, parties are "free to walk away from a mediation" in a way they aren't if they have entered arbitration.

He also said the State Bar was clearly the best entity to take on such a program, despite its recent problems, because it has relevant experience and oversight. Such a program could not be mandatory, he added, because many neutrals are not attorneys.

Umberg also acknowledged that some independent neutrals have also raised concerns that SB 940 could increase the advantage of large ADR providers, who can more easily satisfy the requirements of a registration program. Small and solo providers, especially those with specific boutique practices, should "feel free" not to register with the bar, he said.

"A seal of approval on an ADR firm is not required," Umberg said. "Just like being a family law specialist is not required to practice in family law."

Umberg also spoke about helping push passage of the bill to change the name of the school formerly known as UC Hastings to UC Law San Francisco. This followed a renewed outcry over claims that founder Serranus Hastings' funded the slaughter of Native Americans in Northern California. The bill that allowed the school's name change -- AB 1936 by Assemblymember James Ramos, D-Highland -- later survived a legal challenge brought by disgruntled alumni.

Both Umberg and Robertson said they were alumni of the school.