Background Information

The vice president is concerned that the company is undertaking a number of international projects without a complete understanding of the risks that such activities entail. Specifically, the VP would like further thoughts on the following issues:

Question:

1. Colossal management also needs to know whether arbitration is a good idea for a dispute resolution provision for both domestic and international contracts and why.
2. The parent company, Colossal Corporation, has been sued in the country of Notso in South America. The lawsuit claims millions of dollars in damages due to supposed pollution at a mine that Colossal owned there. Since Colossal has already decided to exit that country and sold the mine there, the company's regional VP believes there is no risk if the company is taken to court in Notso. He says that even if Colossal loses there and a court judgment is rendered against it, there is no danger because the company will have left the country. The VP needs to know if he is right.