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In Arbitration, a ‘Privatization of the Justice System’

29 points by Futurebot 11y ago

lintiness 11y ago
arbitration offers quick dispute resolution in an insanely litigious country. the "small guy" faces extraordinary legal expenses in the public justice system.
- FussyZeus 11y ago
  If it's such a good alternative then why are companies requiring it per terms of contracts rather than the company and the individual agreeing to it mutually once a dispute has arisen? And are you just entirely ignoring that the company effectively holds all the cards in this poker game? What power does the individual have?
  - lintiness 11y ago
    companies recognize the cost of litigation and want to mitigate the risk. the individual has the power to omit the clause and / or not sign the agreement. what do you mean, what power does the individual have?
    - throwaway2048 11y ago
      Contracts of adhesion offer no ability to modify. When the choice of "not signing" means not getting a job or internet access, or medical coverage that's not much of a choice at all...
    - FussyZeus 11y ago
      Omit the clause? Have you ever bought anything big? The contractual relationship between a dealer of a product and the customer is a one sided deal: sign this, or you don't get the thing. And I know what you're going to say, "well then just don't buy it," which doesn't work when every dealer has the same policy.
throwaway2048 11y ago
Companies that insert mandatory arbitration clauses that get to pick and choose arbitrators. Why should an arbitrator rule against the company that is employing them, especially as it virtually ensures the company will not do so in the future? Arbitration is really only fair and effective between equal peers that can choose to split the costs of the arbitration, and agree upon an arbitrator together. In cases of arbitration between a large entity and a single small customer, the large entity wins virtually every single time. The top 10 arbitration firms in the USA only rule in the favor of the consumer/employee 1.6% of the time [1] There's not a single health plan available in many states that does not require agreeing to binding arbitration for coverage. None of them allow you to opt out, even if you're willing to pay more. Sign away your right to sue, or no coverage for you. Consider that under health care reform, one is required to purchase one of these plans. There are dozens of industries that are like this, where it is virtually impossible to receive a service or a good of that class without agreeing to mandatory binding arbitration, such as residential ISPs. Add into the fact there is almost no way to appeal decisions, make no mistake, Companies are not doing this for your benefit. The term "kangaroo court" comes to mind. [1]http://consumerist.com/2007/07/26/support-the-arbitration-fairness-act/ http://consumerist.com/2007/07/26/support-the-arbitration-fa...
imh 11y ago
>For many people, when the choice is between giving up the right to go to court or the chance to get a job, it is not a choice at all. This is the worst part. There's really no choice for 'the little guy' on whether or not to sign these things. But this article and others demonstrate it to be an unfair system people should be able to keep out of (that's what those rights are for!) So how do we solve it? It seems like legally requiring the option of going to court should work. When there is no other option but to waive your rights, the rights may as well not exist.
kevin_b_er 11y ago
All supposed "rights" are ones that restrict the behavior of government. It does not restrict the behavior of a private corporation. Once you privatize something, the protection of god given rights no longer applies. When everything is privatized under libertarian philosophy, what basic rights do you have left other than the power of money?
- kaonashi 11y ago
  The power of a given currency is inextricably tied to the government that issues it; once the government goes, so does the currency. So in essence, the government is supporting rule by private actors. Glib, but relevant: http://brianmay.com/brian/brianssb/pix/14/NHS_who_gets_all_the_cash_600x775.jpg http://brianmay.com/brian/brianssb/pix/14/NHS_who_gets_all_t...
- scrupulusalbion 11y ago
  In the present discussion, the increase in usage of arbitration is not necessarily motivated by libertarian philosophy. It would seem simpler to assume that the companies that include binding arbitration in their contracts are simply making what they believe to be a good move. Further, unless the corporate executives or lawyers come out as libertarians, then I think it is putting thoughts into their heads to treat this issue as anything other than an apolitical, pragmatic move.

29 points by Futurebot 11y ago

arbitration offers quick dispute resolution in an insanely litigious country. the "small guy" faces extraordinary legal expenses in the public justice system.

FussyZeus 11y ago
If it's such a good alternative then why are companies requiring it per terms of contracts rather than the company and the individual agreeing to it mutually once a dispute has arisen? And are you just entirely ignoring that the company effectively holds all the cards in this poker game? What power does the individual have?
- lintiness 11y ago
  companies recognize the cost of litigation and want to mitigate the risk. the individual has the power to omit the clause and / or not sign the agreement. what do you mean, what power does the individual have?
  - throwaway2048 11y ago
    Contracts of adhesion offer no ability to modify. When the choice of "not signing" means not getting a job or internet access, or medical coverage that's not much of a choice at all...
  - FussyZeus 11y ago
    Omit the clause? Have you ever bought anything big? The contractual relationship between a dealer of a product and the customer is a one sided deal: sign this, or you don't get the thing. And I know what you're going to say, "well then just don't buy it," which doesn't work when every dealer has the same policy.

throwaway2048 11y ago

Companies that insert mandatory arbitration clauses that get to pick and choose arbitrators. Why should an arbitrator rule against the company that is employing them, especially as it virtually ensures the company will not do so in the future? Arbitration is really only fair and effective between equal peers that can choose to split the costs of the arbitration, and agree upon an arbitrator together. In cases of arbitration between a large entity and a single small customer, the large entity wins virtually every single time. The top 10 arbitration firms in the USA only rule in the favor of the consumer/employee 1.6% of the time [1] There's not a single health plan available in many states that does not require agreeing to binding arbitration for coverage. None of them allow you to opt out, even if you're willing to pay more. Sign away your right to sue, or no coverage for you. Consider that under health care reform, one is required to purchase one of these plans. There are dozens of industries that are like this, where it is virtually impossible to receive a service or a good of that class without agreeing to mandatory binding arbitration, such as residential ISPs. Add into the fact there is almost no way to appeal decisions, make no mistake, Companies are not doing this for your benefit. The term "kangaroo court" comes to mind. [1]http://consumerist.com/2007/07/26/support-the-arbitration-fairness-act/ http://consumerist.com/2007/07/26/support-the-arbitration-fa...

imh 11y ago

>For many people, when the choice is between giving up the right to go to court or the chance to get a job, it is not a choice at all. This is the worst part. There's really no choice for 'the little guy' on whether or not to sign these things. But this article and others demonstrate it to be an unfair system people should be able to keep out of (that's what those rights are for!) So how do we solve it? It seems like legally requiring the option of going to court should work. When there is no other option but to waive your rights, the rights may as well not exist.

kevin_b_er 11y ago

All supposed "rights" are ones that restrict the behavior of government. It does not restrict the behavior of a private corporation. Once you privatize something, the protection of god given rights no longer applies. When everything is privatized under libertarian philosophy, what basic rights do you have left other than the power of money?

kaonashi 11y ago
The power of a given currency is inextricably tied to the government that issues it; once the government goes, so does the currency. So in essence, the government is supporting rule by private actors. Glib, but relevant: http://brianmay.com/brian/brianssb/pix/14/NHS_who_gets_all_the_cash_600x775.jpg http://brianmay.com/brian/brianssb/pix/14/NHS_who_gets_all_t...
scrupulusalbion 11y ago
In the present discussion, the increase in usage of arbitration is not necessarily motivated by libertarian philosophy. It would seem simpler to assume that the companies that include binding arbitration in their contracts are simply making what they believe to be a good move. Further, unless the corporate executives or lawyers come out as libertarians, then I think it is putting thoughts into their heads to treat this issue as anything other than an apolitical, pragmatic move.