Did you read the three articles on arbitration The New York Times published on October 31, November 1 and November 2? They tell a series of horror stories about arbitrations in employment, consumer and religious settings. I was sorely disappointed by them because they continued the trend to politicize arbitration.
This trend toward treating arbitration as political football didn’t just start last week in the Times. For some time now, one side has painted arbitration as bad for consumers because it limits class actions. They contend that class actions tackle the small issues that no individual would litigate. They say they help keep big corporations honest. Another side has said arbitration is good for consumers because it is less expensive and more accessible than litigation. They contend that class actions are bad for consumers because when class action litigation settles, the consumers may receive small gift certificates while the lawyers get big legal fees. See, for example, this article by the US Chamber of Commerce Institute for Legal Reform in response to the Times articles.
Here’s the thing: arbitration is not the problem. (more…)