Forced arbitration is favored by some as an alternative to costly class action lawsuits, but a federal agency report shows that private contracts with fine print sections requiring people to take complaints to arbitrators do not adequately serve the interests of consumers. Conducted in secrecy, forced arbitration cases are resolved overwhelmingly in favor of business interests at the expense of consumers. (Media Matters, December 16, 2014, by Meagan Hatcher-Mays)
In California, in spite of a state law requiring arbitrators to post the number of arbitrations underway and how they’re decided, the companies have not produced the data, say consumer advocates. An arbitration industry spokesperson said that 95 percent of the companies post their results through organizations that follow the disclosure law. Consumers are also concerned that there is no requirement that judges issue written decisions. (San Francisco Chronicle, January 12, 2014, by Carolyn Said)
A pro-business Supreme Court has consistently upheld the practice of forced arbitration, but Congress is considering the Arbitration Fairness Act which would prohibit forced arbitration in consumer disputes as well as in employment, antitrust and civil rights cases. The proposed law would effectively remove the cases from closed-door adjudication. (The Los Angeles Times, January 14, 2014, by Nan Aron)