Penn State Yearbook on Arbitration and Mediation, Vol. 3, p. 52, 2011
42 Pages Posted: 6 Oct 2011
Date Written: October 5, 2011
Arbitration has been demonized in the media and consumer protection debates, often without empirical support or consideration of its attributes. This has led to renewed efforts to pass the Arbitration Fairness Action, which would bar enforcement of pre-dispute arbitration clauses in consumer, employment, and civil rights contexts. It also inspired Dodd-Frank’s preclusion of arbitration clauses in mortgage contracts, along with the Consumer Financial Protection Bureau’s charge to prohibit or limit enforcement of pre-dispute arbitration agreements in consumer financial products and services contracts. Some of this negativity toward arbitration is warranted, especially in the wake of the United Supreme Court’s recent holdings highlighting a pro-business stance enforcement of arbitration agreements. Nonetheless, this does not necessarily justify abolishment of consumer arbitration. Accordingly, this Article suggest a more reasoned approach, and offers suggestions for carefully considered reforms that protect consumers without overly impeding beneficial use of arbitration. Litigation is not always the answer. Instead, it is time to rescue and revive arbitration from ambush.
Keywords: contracts, arbitration, dispute resolution, consumer law, e-contracts, online contracts, form terms, ADR, Federal Arbitration Act
JEL Classification: K12, K41, K30, K10, K39, K00
Suggested Citation: Suggested Citation
Schmitz, Amy, Arbitration Ambush in a Policy Polemic (October 5, 2011). Penn State Yearbook on Arbitration and Mediation, Vol. 3, p. 52, 2011; U of Colorado Law Legal Studies Research Paper No. 11-15. Available at SSRN: https://ssrn.com/abstract=1939444