The American Arbitration Association (AAA) is a private corporation that provides a wide range of legal services that are defined as alternate dispute resolution (ADR). Arbitration, mediation, and other related types of more informal conflict resolution are the component parts of ADR, which has become an integral part of the international sports landscape since the late 1970s.
Arbitration is a process by which two parties in a dispute agree that they will avoid the conventional legal process of trial and judgment through an agreement where each undertakes to be bound by the decision of an arbitrator. Arbitration is generally a much faster process than that of civil litigation. The arbitrators available to the opposed parties also tend to have specialized knowledge and experience with respect to the issues in the dispute. In some instances, the parties in a dispute will engage the services of a mediator. The key distinction between arbitration and mediation is that mediation is a non-binding process, where the recommendations of the mediator are not binding on either party; the work of the mediator is designed to achieve a settlement or, alternatively, a reduction in the number of argued issues between two parties. In almost every case, the services of either arbitrators and mediators are funded by the parties to the dispute.
In sports disputes, arbitrators are selected from a list maintained by the organization providing the arbitration services. The arbitrators will be further sub-categorized on the basis of their experience in particular sport arbitrations. Many arbitrators may be lawyers, but not exclusively so; in sports arbitrations involving financial issues, the arbitrator may have a financial background.
Arbitration as a tool to resolve sports disputes gained prominence in North America in the mid-1970s after professional baseball players, by virtue of a ruling by the United States Supreme Court, gained the right to seek free agency, which frees a player to seek employment with the highest bidder for services at the expiration of a current contract. Arbitration became a frequent means by which contract disputes were resolved between players and teams.
In amateur sport, the role of the arbitration took on special prominence with the rise of doping testing and the challenge made by some athletes as to the legitimacy of a positive test and a resultant competition ban. When athletes resorted to formal legal action to assert a claim that a doping test was flawed, the athlete invariably found that world organizations, such as the International Amateur Athletics Federation (IAAF), were not inclined to honor an order from a court based in a particular state or country, as that court had no jurisdiction beyond the boundaries of the state or country in question. The most prominent example of litigation achieving a dubious end was that initiated by American 400-m runner Butch Reynolds in 1992, in the wake of a positive steroid test. A Cincinnati court ordered Reynolds reinstated by the IAAF, and that Reynolds was to receive $27 million in damages—neither event ever occurred. The court ruling had all of the appearance of favoring a local athlete, and the ruling lacked the credibility that would be needed to sway a powerful international organization such as the IAAF from its course of action.
The creation of the World Anti-Doping Agency (WADA) and the establishment of it as the world authority in the ban on performance-enhancing drugs in athletics served to establish arbitrations as a preferred means for resolving drug-related disputes. The Court of Arbitration for Sport (CAS) does on a global basis what the AAA offers principally in the United States (although the AAA also does arbitrations work in various countries throughout the world). The AAA is specifically named in the constitution and bylaws of the United States Olympic Committee (USOC) as a designated agency for the administration and resolution of amateur sports disputes. The AAA, in this role, assists in the arbitration and mediation of matters such as the eligibility of athletes and doping infractions. The AAA also establishes on-site arbitration services, to deal with disputes that may arise in the course of a multi-day athletic event, when the resolution of the issues cannot be delayed to a better time.
An example of the relationship that exists between the various sports bodies in approaches to athletic dispute resolution is found in the Zach-Lund case, determined prior to the 2006 Winter Olympics. Lund, an American skeleton racer, tested positive for the banned substance finasteride, a diuretic. Lund had disclosed his use of this substance as a component to a hair loss product that he had been using for a period of years; WADA banned the use of finasteride through its inclusion on the WADA Prohibited List in 2005. When Lund tested positive for the substance, he availed himself of the arbitration procedures provided by the USOC constitution; the USOC deemed that a warning was a sufficient sanction for Lund. WADA disagreed with the USOC decision, and it ultimately requested the CAS to arbitrate the matter again in advance of the 2006 Games; the CAS arbitrator expressed a measure of sympathy for Lund's position, but varied the penalty to a one-year suspension from all international competition.