Mandatory Arbitration Clauses Deprive Consumers of Basic Rights

Get a credit card, buy a car, or sign up for a cellphone plan, and chances are, if you’re unhappy with your transaction, you won’t be telling your story to a judge. Many consumer contracts include unfair mandatory arbitration clauses that force individuals to go through arbitration, instead of civil court, if a dispute arises. Mandatory arbitration clauses tend to give companies, not the public, protection because the arbitration process can be costly and the time to make a case is limited.
Consumer lawyers contend that private arbitration companies are pressured to rule in favor of corporations, which often are repeat arbitration customers. If arbitrators rule against companies too often, they get blackballed.
Now Congress is considering a blanket negation of predispute mandatory arbitration agreements. The Arbitration Fairness Act of 2007, recently introduced in the Senate and House of Representatives, proposes making the clauses unenforceable. Our lawyers are urging our clients to contact their Representatives and Senators in Congress to voice support of this bill.