Last week, TMLG partner Beth Terrell joined a panel of experts in demystifying forced arbitration following the Seattle premiere of Lost in the Fine Print. An Alliance for Justice documentary, Lost in the Fine Print tells the stories of three Americans who were harmed by powerful corporations and then denied their day in court because of forced arbitration, a little known for-profit system of justice.
Americans are presented with long form contracts or “terms of service” nearly every day when they buy cell phones or cars, sign loan documents or credit card applications, make online purchases, or accept employment agreements. Most people don’t realize that what frequently lies buried in the fine print are forced arbitration clauses. Those clauses say that if the person is cheated by the company, harmed by the product, or discriminated against by their employer, they have no right to have their claim resolved by a jury or a judge. Instead, Americans are forced into secretive arbitration proceedings where the company sets the rules and chooses the decision maker. One study showed that arbitrators rule for companies over consumers 94% of the time. By ruling for corporations, arbitrators ensure that they will be hired by those corporations again.
Keynote speaker Representative Suzan DelBene (D-WA) urged, “We cannot afford to lose the value of public justice under the law… The [Federal Arbitration Act] has been misinterpreted by the Supreme Court [such that it] shields corporations from liability.” As it is currently interpreted, the FAA allows large companies to insulate themselves from any accountability. Because it shuts consumers and employees out of court, forced arbitration weakens enforcement of hallowed laws such as the Civil Rights Act of 1964, the Age Discrimination in Employment Act, and the Equal Pay Act.
Nationally recognized attorney and civil rights activist Lorena González moderated the panel. Terrell and fellow panelist Deepak Gupta dissected the fallacy of consent when arbitration clauses are buried deep within Terms of Service or employment offer packages. When we accept agreements we have clearly not read, Gupta explained, “there is a fiction in the ritual that we’ve consented to what is in the fine print. As we move toward more and more instant transactions, it becomes easier and easier to insert this into the exchange in commerce.”
Panelists beseeched the public to stand up against forced arbitration by spreading the word. Terrell cited an instance when Facebook users harnessed the company’s technology to demand that Facebook remove forced arbitration from its terms of use. She explained, “Corporations are trawling the internet. They care about their reputation. Be active in voicing complaints on social media to force corporations to change their policy.”
Learn more about forced arbitration and the organizations involved in Lost in the Fine Print:
The Alliance for Justice is a national association of over 100 organizations committed to progressive values and the creation of an equitable, just, and free society. Get involved with the fight against forced arbitration at www.LostInTheFinePrint.org. Find out which companies you have relationships with that have arbitration clauses – and tell them to stop – at http://bit.ly/BanForcedArbitration.
The Consumer Financial Protection Bureau, a government agency responsible for consumer protection in the financial sector, published a recent study that shows how forced arbitration overwhelmingly favors Wall Street and big banks by making consumer claims disappear. Read more about CFPB’s report on forced arbitration here