Resnik – Unlocking the Courts: Ending Arbitration Mandates and Gag Orders

Yale law professor Judith Resnik has penned an op-ed calling for passage of the Forced Arbitration Injustice Repeal Act (FAIRA).  That shouldn’t be a surprise based on her work on democratic values and arbitration over the years.  However, she dug into some data and . . . . well, check out the excerpt below.

Advocates of arbitration insist it is “faster, cheaper, and more effective” than filing a lawsuit. Is that true? And if so, why can’t we choose for ourselves rather than being banned from filing lawsuits and silenced if we use arbitration?

To get answers, I dug into the data, provided by the American Arbitration Association, or AAA, under state law and recording all arbitrations it provided nationwide. What the numbers show is that virtually no consumers use arbitration and the reasons why efforts are now underway to silence the very few arbitration users that remain.

Take AT&T, which in 2011 succeeded in convincing the U.S. Supreme Court that its ban on class actions was enforceable. Between 2017 and 2019, AT&T had 140 million customers. Public data from the AAA show that only 172 customers a year — less than two out of every million consumers — filed arbitration claims.

Simply put, individuals don’t have the resources, knowledge, energy, time and money to go it alone. By cutting off class-action lawsuits, “repeat players” like AT&T can suppress legal claims.

* * *

Contract, consent and agreement sound great. None of it is true for mass mailing credit cards and employment forms. Consumers, employees and civil rights claimants need to join together to support FAIRA because this legislation recognizes that they never did “agree” to be kept out of court, ride solo or be silenced.

Hat tip – Jean Sternlight

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