New consumer arbitration study

by Walter Olson on March 13, 2009

The Searle Center at Northwestern is out with a new study of consumer arbitration that suggests it’s not the bogeyman trial lawyers have been painting it as (we’ve touched on the topic before). I’ve got a summary excerpt and a few more links over at Point of Law.

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On C-SPAN tonight: “Protecting Main Street From Lawsuit Abuse”
03.16.09 at 6:41 pm

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1 Max Kennerly 03.13.09 at 9:34 am

That’s like comparing a nice bag of fresh apples with salmonella-infected peanuts.

I’ve had good experiences with the AAA. Now open up your credit card agreement and see if they use AAA.

Betcha it says National Arbitration Forum (“NAF”) — a whole different bag of beans, one that viciously roots out anyone who rules in favor of consumers. See (and the links it has):

http://pubcit.typepad.com/clpblog/2008/06/elizabeth-warre.html

Moreover, lots of companies (particularly franchisers) reserve the right to choose whoever they want as arbitrator (as opposed to the impartial arbitrators offered by the AAA), which guarantees you’ll lose when you sue them, see my recent post:

http://www.litigationandtrial.com/2009/03/articles/the-law/for-people/the-very-worst-contractual-provision-to-which-you-can-agree/

Arbitration isn’t a right, it’s enabled by statute. Congress should investigate and regulate the arbitration associates and should flat-out ban these “I get to choose the arbitrator” clauses.

2 William Nuesslein 03.14.09 at 1:19 pm

If Elisabeth Warren is against arbitration clauses, then they must be pretty good.

3 Ted Frank 03.16.09 at 7:50 pm

As Professor Sarah Cole and I found out when analyzing the underlying data, the Public Citizen report on NAF had remarkable swaths of fiction.

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