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What Is More Important To You, Justice, Or Corporate Profits?

How America is allowing forced arbitration to erode the publics rights in favor of special interests.

What if one day you lived in a country where the justice system had no court of law, where you do not get represented by an attorney, and where the judge in your case was employed by your adversary, and the decision that will hold sway over your life was in the hands of a company with their own interests in mind? That would be a scary society to live in.

Unfortunately while that may sound like just another dystopian sci-fi novel, many would be shocked to know our own country is steadily moving toward that direction.

In the quest for higher profits and freedom from responsibility companies numbering the thousands are adding forced arbitration clauses to their service contracts and terms of employment.

The arbitration clause is always buried deep in the fine print and in most cases the consumer or employee are completely unaware that they have agreed to waive their right to a court of law in the event of a dispute by signing the contract.

So What Exactly is Forced Arbitration Anyway?

Essentially forced arbitration means that should a dispute arise you cannot take your case to a court of law, in front of a jury of your peers.

Instead, your case will be decided by an arbitrator – the private sector version of a judge – usually under the employ of the company you have a grievance with.

This arbitrator has been hired by the company you have the dispute with, to determine what outcome your dispute with their employer will have. Sounds fair right?

This is both clearly a conflict of interests and an unfair setting to have your claim decided.

Forced arbitration in commercial contracts and employment agreements has far reaching effects that prevent companies from being legally responsible from everything from gross negligence, to sexual discrimination, medical malpractice, defective products, personal injury, financial loss, employability and the list goes on and on. Forced arbitration boils down to a get out of jail free card for corporations.

Many do not understand that, civil rights and consumer protection laws are often meaningless in arbitration.

A recent New York Times article by Jessica Silver-Greenberg and Robert Gebeloff, entitled ‘Arbitration Everywhere, Stacking The Deck Of Justice‘ explains, “inserting individual arbitration clauses into a soaring number of consumer and employment contracts, companies like american express devised a way to circumvent the courts and bar people from joining together in class-action lawsuits, realistically the only tool citizens have to fight illegal or deceitful business practices.” The article continues on with, “over the last few years, it has become increasingly difficult to apply for a credit card, use a cellphone, get cable or Internet service, or shop online without agreeing to private arbitration” , including “getting a job, renting a car or placing a relative in a nursing home”.

Read the complete New York Times article here

Now some may say that just because the arbitrator has been hired by the company, that does not always mean that the consumer or employer will get an unfair result. However the reality is more often than not the rules and outcomes of these arbitration ‘settlements’ favor the company, and even should the company not prevail, the award given to the consumer or employee is far less than they would have been ranted by a jury of their peers in a court of law.

Playing By Unfair Rules

While the past few years have delivered a tidal wave of forced arbitration contracts in corporate america that bind consumers and employees, corporations themselves do not hold themselves to this same standard.

During the late 90’s and early 2000’s businesses were so afraid of forced arbitration agreements between each other that millions of dollars were spent lobbying congress.

As a result, in 2002 the car dealer industry successfully convinced congress to pass a law prohibiting forced arbitration in their dealings with auto manufacturers. These same dealers then turn around and add forced arbitration clauses to their own employment contracts.

So where are the lobbyists representing the general public? Why will congress agree to protect the legal rights of corporations but allow their constituents to unknowingly waive their right to representation in a court of law?

The answer is – the public has no lobbyist bending ears and twisting arms in congress. If citizens want to reverse this push to remove our right to legal representation in favor of corporate profits, than this issue must become more visible to the public, and we as individual citizens must contact congressional and state representatives. An election year is the best time to bring up important issues and have them brought to the spotlight.

As a practicing attorney at a civil trial law firm I have personally witnessed the damaging effect negligence, defective products and unfair practices can have on families in our communities. As such, seeing consumers and employees unknowingly giving up their right to a legal system over 200 years in the making is all the more disturbing.

To state it plainly, forced arbitration is the biggest threat to civil liberties and access to justice I have seen in my lifetime.

Bernard F. Walsh

For more information about forced arbitration visit the websites below:

Fair Arbitration Now:

Fight Forced Arbitration:

What Is More Important To You, Justice, Or Corporate Profits?

Goldman Babboni Fernandez
Murphy & Walsh

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