Forced Arbitration Clause
As consumers, we are constantly asked to sign agreements with our cell phone provider, a credit card company, a cable company, an ecommerce merchant, etc. Before signing these agreements, we are typically asked to agree to the terms and conditions of the agreement. These contracts of adhesion now have standard forced arbitration clauses. So what? Well, watch this brief documentary, which will open your eyes to how corporations are warping the justice system against consumers with forced arbitration.
As Paul Bland, Executive Director of Public Justice explains in the documentary’s companion article, forced arbitration has thwarted the justice system in our country. Replacing the public justice system that our founding fathers developed and envisioned, consumers are now thrust into a for-profit system rigged in favor of corporations. As I wrote in a previous blog post, AMEX v. Italian Colors was a devastating decision, which now allows the Federal Arbitration Act to override virtually any other statute. Merchants like the small town restaurant owner of Italian Colors are bound to forced arbitration clauses:
Before this decision, SCOTUS said that courts should only enforce arbitration clauses where a party could “effectively vindicate its statutory rights.” However, with American Express v. Italian Colors, a majority (composed of the five conservative justices) held that the arbitration clauses are enforceable even if doing so makes it impossible for a plaintiff to actually vindicate its statutory rights.*
*Excerpt from blog post July 2013 blog post.