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What's in the fine print: Forced Arbitration

We've all seen it- we go to buy the latest cell phone or apply for a new credit card and there it is, page after page of fine print. Most of us see those pages and easily skip over them and sign the back of an agreement without ever knowing what we just agreed to. Unfortunately, lurking in the fine print is a huge danger to consumer rights-forced arbitration.

Most people do not understand arbitration, much less forced arbitration. Arbitration, as defined by the National Association of Consumer Advocates is "an alternative method of resolving disputes in which two parties present their individual sides of a complaint to an arbitrator or panel of arbitrators. The arbitrator decides the rules, weighs the facts and arguments of both parties, and then decides the dispute."

Forced arbitration, as defined by the same group, when "a company requires a consumer or employee to submit any dispute that may arise to binding arbitration as a condition of employment or buying a product or service. The employee or consumer is required to waive their right to sue, to participate in a class action lawsuit, or to appeal. Forced arbitration is mandatory, the arbitrator's decision is binding, and the results are not public." This short film highlights the dangers of forced arbitration

Consumers and employees are often forced to sign forced arbitration clauses in order to receive the product or to get hired at a new job. Forced arbitration is a tactic used by large corporations and is a tactic that is chipping away at individuals' 7th Amendment Rights.

According to Take Justice Back, forced arbitration agreements and other fine print hurt Americans in the following ways:

  • One-sided Requirements - Most forced arbitration clauses require the consumer to waive their rights, while allowing the corporation to sue in court.
  • High Costs - Consumers often must pay steep filing fees just to initiate a case and pay their share of the arbitrator's hourly charges. In addition, forced arbitration clauses often allow the corporation to choose the location, regardless of how inconvenient or costly travel will be for the consumer.
  • Biased Decision-Makers - Since only businesses are repeat users of an arbitrator, there is a disincentive for an arbitrator to rule in favor of a consumer if he expects further retentions.
  • Weak Civil Justice Safeguards - Forced arbitration clauses often severely restrict the individual's ability to argue his or her side of the case. For example, many restrict the individual's ability to obtain necessary evidence. Also, it is nearly impossible to appeal adverse decisions by arbitrators.
  • Secret Backroom Proceedings - While proceedings and records of the courts are open to the public, most forced arbitration clauses require that proceedings be kept confidential, even if the case raises important public health and safety issues.

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Manchin Injury Law Group 1543 Fairmont Avenue Suite 203 Fairmont, WV 26554 Toll Free: 866-903-9632 Phone: 304-816-4097 Fax: 304-367-1867 Fairmont Law Office Map