Today's #Arbitration Hearing before the Senate Judiciary Committee

Video of the hearing with the following witnesses:

Mr. Kevin Ziober
Navy Reservist
Newport Beach , CA

Professor Myriam Gilles
Professor Of Law
Benjamin N. Cardozo School Of Law
Yeshiva University
New York, NY

Mr. Alan S. Kaplinsky
Partner
Ballard Spahr LLP
Philadelphia , PA

Mr. F. Paul Bland, Jr.
Executive Director
Public Justice
Washington , DC

Mr. Alan Carlson
Italian Colors Restaurant
Oakland , CA

Mr. Victor E. Schwartz
Co-Chair, Public Policy Practice Group
Shook, Hardy, & Bacon LLP
Washington , DC

Trial Lawyers vs. Chamber of Commerce: Battle over Arbitration

Enforcement of arbitration clauses, especially in the context of form contracts presented by businesses to consumers and employees, has long been a battle between trial lawyers and business.  

Here is a big recent document by the trial lawyers' American Association for Justice.    Here is the US Chamber of Commerce's side of the story, from its Institute for Legal Reform.

I tend to agree with the Chamber as evident in this congressional testimony (video), law review article and policy analysis for the Cato Institute.

Prediction CFPB Will Ban or Limit Arbitration Class Waivers

Last month, the Consumer Financial Protection Bureau released the preliminary results of its study on arbitration in consumer financial transactions such as credit cards, checking accounts and payday loans.  James McGuire and Kay Fitz-Patrick at Morrison & Foerster LLP say "We can expect that, after completing its study, the CFPB will issue a rulemaking that either bans or limits the use of arbitration clauses with class waivers in connection with financial products."

The MoFo lawyers' prediction is backed by some good points under the heading “POLITICAL CLIMATE”:

·         “there has been increased criticism of the inclusion of arbitration clauses, especially those that contain class waivers, in consumer contracts since the Supreme Court has twice ‘rejected the argument that class arbitration was necessary to prosecute claims that might otherwise slip through the legal system’ – in AT&T Mobility v. Concepcion, 131 S. Ct. 1740 (2011) and in American Express Co. v. Italian Colors Restaurant, 133 S. Ct. 2304 (2013).”

·         “The hostility towards the decisions is further evidenced by” the Senate Judiciary hearing on December 17, 2013. Senator Al Franken presided over the hearing quite assertively.

·         Sen. Franken reintroduced legislation seeking to prevent enforcement of pre-dispute arbitration agreements in contracts of adhesion.





  

Congressional Hearing on Arbitration

Yesterday, the Senate Judiciary Committee held a hearing entitled "The Federal Arbitration Act and Access to Justice: Will Recent Supreme Court Decisions Undermine the Rights of Consumers, Workers, and Small Businesses?"   Video of the hearing is here.   Senator Al Franken begins the hearing with a strongly negative view toward arbitration clauses in consumer and employment contracts of adhesion.  While I disagree with much of it, he is a very intelligent person, which showed in his comedy career and shows in the senate.

The witnesses at this hearing include several very impressive and capable people:

Leslie Overton

Deputy Assistant Attorney General for Civil Enforcement, Antitrust Division
U.S. Department of Justice

Alan Carlson

Owner
Italian Colors Restaurant
Oakland, CA

Myriam Gilles

Professor of Law
Benjamin N. Cardozo School of Law

Vildan Teske

Partner
Crowder, Teske, Katz, & Micko, PLLP
Minneapolis, MN

Archis A. Parasharami

Partner & Co-Chair, Consumer Litigation & Class Actions practice
Mayer Brown LLP
Washington, DC

Peter Bowman Rutledge

Associate Dean for Faculty Development
Herman E. Talmadge Chair of Law
University of Georgia School of Law

UNLV Law Prof. Jean Sternlight's written testimony is here.