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Horrors of Forced Arbitration Spreading Far and Wide

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he New York Times just published an extensive investigation into how Wall Street and corporate America pursued a deliberate, corrupt and insidious attack on the American consumer.

It reports on “a far-reaching power play orchestrated by American corporations” in a series of articles, titled "Arbitration Everywhere, Stacking the Deck of Justice."

By “inserting individual arbitration clauses into a soaring number of consumer and employment contracts, companies like American Express devised a way to get around the courts and bar people from joining together in class-action lawsuits, realistically the only tool citizens have to fight illegal or deceitful business practices.”

Class-action bans

The Times notes that “over the last few years, it has become increasingly difficult to apply for a credit card, use a cellphone, get cable or Internet service, or shop online without agreeing to private arbitration,” as well as “getting a job, renting a car or placing a relative in a nursing home.” According to the Times, “some state judges have called the class-action bans a ‘get out of jail free’ card, because it is nearly impossible for one individual to take on a corporation with vast resources.”

“Forced arbitration is a corporate bullying tactic designed to kick people out of court and eliminate their right to seek justice. It’s a rigged system set up by corporations to favor corporations," said American Association for Justice CEO Linda Lipsen.

"Big businesses are using fine print to take away the rights of consumers, patients, and workers.  Unfortunately forced arbitration has infiltrated nearly all aspects of American life.  Americans are subjected to forced arbitration clauses when they use credit cards, talk on their cell phones, visit websites, start a new job, and even admit a loved one into a nursing home. Corporations use forced arbitration because they know that when they lie, cheat, and steal from the public, the fine print gives them a free pass to break the law and evade all accountability.”

The New York Times reports that Deborah L. Pierce, an emergency room doctor in Philadelphia, “was optimistic when she brought a sex discrimination claim against the medical group that had dismissed her,” but “she began to worry, though, once she was blocked from court and forced into private arbitration,” where a corporate attorney who also handled arbitrations ultimately ruled against her.

An investigation by the Times found that arbitration “often bears little resemblance to court,” and that “over the last 10 years, thousands of businesses across the country – from big corporations to storefront shops – have used arbitration to create an alternate system of justice.” Under arbitration, “rules tend to favor businesses, and judges and juries have been replaced by arbitrators who commonly consider the companies their clients, The Times found.”

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