I’m mad as hell and I’m not going to take it anymore,” said Howard Beale in the Movie Network. As a staunch supporter and advocate for arbitration, I cannot not allow wrongful bashing by members of Congress, the Consumer Financial Protection Bureau, the media and others to continue without stating categorically how wrong they are when suggesting that arbitration is not good for the consumer. I agree, arbitration is not good for the consumer, IT IS GREAT for the consumer.
If you look at the line of cases related to arbitration provisions that have been reported by the media or have been appealed and decided upon by appellate courts, they almost universally involve consumers rights as they relate to class actions, not arbitration. No, I did not make a mistake. You see, somewhere in the past, attorneys drafting the terms and conditions for consumer agreements thought it would be very clever to try to hide anti-class action clauses by embedding them in the paragraph related to dispute resolution and arbitration. Rightfully and properly, courts – and Congress – are very protective of consumers. When you view the history of the reported cases related to the unfairness of arbitration, they are almost all focused on the class action aspects of the agreement, not the arbitration provisions. So any lazy or uneducated person, reporter or blogger lumps the arbitration and anti-class action aspects together and bashes them both.
Fact Check: Litigation is generally the lengthiest and most costly way to resolve a dispute. By it’s very nature, litigation is a consumer’s worst nightmare – not savior. Even one of the United States’ Founding Fathers and our first President, George Washington, believed litigation to be an untenable method to resolve disputes and advocated arbitration. This is evidenced by his Last Will and Testament which read in part, “My Will and direction is, that all disputes (if unhappily any should arise) shall be decided by three impartial and intelligent men, known for their probity and good understanding; two be chosen by the disputants, each having the choice of one, and the third by those two. Which three men thus chosen, shall, unfettered by law, or legal constructions, declare their sense of the Testator’s intention; and such decision is, to all intents and purposes to be as binding on the parties as if it had been given in the Supreme Court of the United States.”
Arbitration, when administered properly by unbiased and knowledgeable people is a consumer’s best weapon at leveling the playing field in virtually any type of dispute, especially involving companies with significantly larger financial wherewithal. The process, depending on the arbitration forum or arbitrator selected independently of a specific forum, is always quicker, less expensive and easier for the consumer to participate in. Anyone that takes the position that litigation is better is simply ignorant.