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The power of counsel : a qualitative socio-legal study in investment treaty arbitration
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Florence : European University Institute, 2025
EUI; LAW; PhD Thesis
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TRAXLER, Tobias, The power of counsel : a qualitative socio-legal study in investment treaty arbitration, Florence : European University Institute, 2025, EUI, LAW, PhD Thesis - https://hdl.handle.net/1814/77809
Abstract
The influence of legal counsel on litigation outcomes has been well-documented in the law and society literature. Extending this to investment treaty arbitration, a study by Franck and Wylie (2015) found counsel experience to be the most statistically significant predictor of outcomes. Building on their findings, this study dives deeper to explore two important research questions. First, in what activities does counsel engage with a view to influencing outcomes in investment treaty arbitrations? Second, which of these activities create effective pathways for counsel to exert influence on such outcomes? Using data from 48 novel, semi-structured interviews with arbitration practitioners, the study uncovers four pathways through which counsel shape outcomes. First, they establish facts and frame the case through evidence collection, witness testimony, and cross-examination. Second, they impact results through strategic selection of party-appointed and presiding arbitrators. In selecting party-appointed arbitrators, counsel tend to rely on seemingly widespread and effective heuristics for ascertaining potential appointees’ suitability. In selecting presiding arbitrators, counsel generally seek to advance their party’s position by anticipating collegiate dynamics within the tribunal. Third, while advocacy is a factor, its impact is often limited due to inconsistent quality. Fourth, counsel have a profound impact on the valuation of damages. They exert this influence by selecting and instructing valuation experts. These experts’ influence, in turn, derives from the combination of complex, speculative valuation analyses and arbitrators who struggle to understand and apply these analyses properly. Thus, counsel are powerful actors in investment treaty arbitrations. There is reason for concern that counsel’s influence may advantage players who are able and willing to spend more on their legal representatives. While some players may benefit from reduced counsel rates and thirdparty funding, systemic solutions would be preferable. To a significant degree, this may be achieved through establishing an advisory centre for international investment law, eliminating disputing parties’ right to unilaterally appoint arbitrators, and regulating valuation practices.
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Defence date: 21 January 2025
Examining Board: Prof. Jürgen Kurtz (University of Melbourne; European University Institute, supervisor); Prof. Sergio Puig de la Parra (European University Institute); Prof. Freya Baetens (University of Oxford; Leiden University); Dr. Taylor St John (University of Oslo; University of St Andrews)
Examining Board: Prof. Jürgen Kurtz (University of Melbourne; European University Institute, supervisor); Prof. Sergio Puig de la Parra (European University Institute); Prof. Freya Baetens (University of Oxford; Leiden University); Dr. Taylor St John (University of Oslo; University of St Andrews)
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Chapter 3 'Arbitrator selection and tribunal formation' of the PhD thesis draws upon an earlier version published as an article 'Pro-claimant bias in arbitrator selection' (2024) in the journal 'Journal of international economic law'.