The New York Times reported on the bill attempting to reform how arbitration agreements are used against consumers. The bill would limit the use of arbitration, a process used to resolve legal disputes and evade accountability, that is often stacked against consumers. Embedded in tens of millions of contracts, the clauses prevent Americans from joining in class-action lawsuits, the only realistic way that an individual can do battle with a wealthy corporation.
The bill would prevent civil rights cases, employment disputes and other crucial lawsuits from being forced into arbitration, where judges and juries have been replaced by arbitrators who commonly consider the companies their clients. If enacted, the bill would make claims brought under laws like the Family Medical Leave Act and the Fair Labor Standards Act exempt from arbitration.
“Legal fine print tips the scales against us,” Mr. Leahy said. “It is forcing consumers into private arbitration, denying us of our constitutional right to protect ourselves in court.” Regulators and lawmakers have been pushing to prevent companies, large and small, from inserting arbitration clauses in contracts. It is virtually impossible to rent a car, open a bank account, get a job or enroll an elderly parent in a nursing home without signing away the right to take a case to court.
In its investigation, based on thousands of court records and interviews with hundreds of lawyers, judges and arbitrators in 35 states, The Times found that by using arbitration clauses corporations can circumvent the courts and quash challenges to discrimination, predatory lending and even wrongful death.
Behind the latest bill is an acknowledgment that critical laws resulting from the civil rights and disability rights movements are fatally undermined by arbitration.