A commenter complains about our most recent post, and I respond:
Deprive consumers of a right to mandatory arbitration? Aren’t you being misleading here? There’s nothing stopping corporations offering both arbitration and a court of law to their customers.
This is disingenuous. Mandatory arbitration provides savings because the parties know in advance that the other party won’t abuse the legal system to raise costs. If the parties do not have the choice of pre-committing to arbitration in advance, then the savings aren’t available, because one party, after the fact, can abuse the civil justice system to raise costs. The problem isn’t that people with legitimate claims might not choose arbitration given the opportunity; the problem is that people with illegitimate claims who hope to extort money through forcing the other side through unnecessary legal expenses, won’t choose arbitration. If I can’t promise my credit card company not to bring illegitimate litigation that will raise their expenses, they have to charge me a higher price to account for the risk of me bringing illegitimate civil litigation. My promise to not abuse the legal system is worth money to the other party, be it my employer or my credit card company or my doctor; they are willing to pay me (in higher wages or lower costs) for an enforceable promise to that effect. If consumers are not allowed to make such an enforceable promise, consumers are worse off.
The extortion effect of litigation is not in question. Lefty labor lawyer Thomas Geoghegan wrote about it in his most recent book, as I discuss in my my law review article analyzing his book.
What is the issue is forcing people into arbitrations, especially arbitrations with larger corporations, such as KBR. People should be allowed to choose. Or don’t you agree that people have the right to choose?
Of course people should have the right to choose. The litigation lobby is trying to deprive people of the choice of precommitting to arbitration.
You’re also misleading in your statement about Barker bringing suit against the person who raped her. In this specific instance, the issue has to do with her right to bring a civil suit in a court of law against KBR.
I’m not misleading at all. KBR didn’t rape Barker; a civilian (allegedly) did, and the original DMI and Alternet posts falsely stated that Barker had to arbitrate that civil suit against the rapist. Barker can still sue the civilian in civil court if she so desires, and such a suit is currently pending. And Barker still has whatever legal remedies she has against KBR in arbitration, which takes away no rights whatsoever.
As for privacy of the proceedings, if this case had happened in a court of law, I could easily find all the documentation associated with it, without having to ask anyone’s permission. I notice that you didn’t ask KBR to publish their documents associated with this arbitration. Why not ask KBR for their copies of what little documentation there is?
I asked both parties. But KBR isn’t the one claiming the arbitration is secret. Jones and her attorney, Todd Kelly, are. The arbitration is as secret as Todd Kelly wants it to be, and no more secret. Again, I will post every brief and every deposition and transcript Kelly wants. He apparently doesn’t want me to post any of them—no doubt because Jones’s claims have shifted over time and if she made her briefs public, it would discredt her other claims.
As for whether the women would still be in litigation in the court system, perhaps, perhaps not.
Absolutely, unless the defendant settled—but any such settlement would almost certainly have a precondition of the same secrecy you purport to complain about. Title VII litigation in civil court doesn’t get resolved in favor of the plaintiff in under three years.
Justice takes time.
It doesn’t have to. Arbitration provides justice, and is both faster and cheaper.
As for the women “winning” these arbitration proceedings, you seem to think that winning is equivalent to getting a cash award. These women also wanted to be heard, to have their day in court. To hold KBR responsible, and ensure that what happened to them didn’t happen to other women.
Courts have no advantage over arbitrations in that fashion. Tracy Barker is in arbitration, yet her story is being told, and she will have her day in the court she agreed to have it in. The justice system is to resolve disputes, not for taxpayer-subsidized storytelling.
If arbitration is so fair, and so unbiased, and so cheap, why would we need to have mandatory arbitration clauses?
Again, the issue is the precondition of arbitration. If people do not have the choice of pre-committing to arbitration, then, without being so bound, they can engage in frivolous litigation and raise costs to everyone.
If courts are so fair to defendants who are being sued frivolously, why not allow mandatory arbitration and let people agree to waive the arbitration clause? It works both ways.
Doesn’t strike me that “mandatory arbitration” is something consumers want.
Consumers who agree to mandatory arbitration received the benefits of mandatory arbitration, and if they fight to litigate after receiving those benefits (either through higher wages or lower costs), they do so because they want to back out of their commitments and raise costs to the defendant to pursue an illegitimate claim. If contracts are not enforced, everyone loses. I’m a consumer and I want mandatory arbitration. Why not give me a choice and let me have it? If consumers don’t want mandatory arbitration, it will go the way of New Coke and Crystal Pepsi as employers and vendors offer contracts without mandatory arbitration. The reason the litigation lobby is fighting arbitration so hard is because the vast majority of consumers, when faced between lower costs or the opportunity to bring meritless litigation, will choose the lower costs every time. Only by depriving consumers of that choice can trial lawyers continue to practice legalized extortion.
For more on arbitration, see the Overlawyered arbitration section.