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Mandatory Arbitration Clauses: Injustice in the Shadow of the Law

6/16/2014

2 Comments

 
Even as a lawyer, I often find myself mindlessly clicking an "I Agree" button on terms of service, use, etc. when I purchase music online or "agree" to use software which I have purchased. And I, like you, have received notices from services I already use - credit cards, online storage services, what have you - that notify me that the terms I originally agreed to have changed. Given the ubiquity of these things, I often don't pay them much mind. Which is probably a mistake, because buried in these agreements you will often find mandatory arbitration clauses, which seriously restrict your rights if something goes wrong.

My Alternative Dispute Resolutions teacher in law school described arbitration as taking place "in the shadow of the law." What he wanted to emphasize was that the decisions are confidential (unlike court decisions, which are available to the public), and that the decision-maker, while being informed by the laws on the books, was not bound to follow them. The upsides of arbitration are that it's often a much quicker and cheaper process than taking a case to court, and the arbitrator is often selected from a group of people who have expertise in the area of dispute. 

However, it is time to ask: has arbitration become just another hammer for those who have power to beat down the everyday consumer?

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