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Friday, March 14, 2014

The Problem with Class Arbitration

"The Problem with Class Arbitration" is an article by Neil Troum, an adjunct professor at Temple University's Beasley School of Law.  He makes what seems to me a powerful point:

"The current state of the law is: where the parties have consented to class arbitration, an arbitrator can enter a class award that a court will confirm and that will have the same res judicata effect as a class action judgment in court. There is a problem with this. The problem is not the incompatibility of the class action's traits with those of the arbitral realm, however--which is how a majority of the Supreme Court currently sees things. It is instead that an arbitrator possesses what power he has only with the consent of the parties whose claim he will resolve. As a result, a class arbitration judgment should not be deemed to have preclusive effect on absent (i.e., nonconsenting) class members, like a class judgment issued from a court. This is not the law, however."

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