10 ms·

These arbitration clauses should be illegal to begin with. You shouldn't have to depend on the largess of a company to have access to the real legal system to

These arbitration clauses should be illegal to begin with. You shouldn't have to depend on the largess of a company to have access to the real legal system to resolve disputes with them. It's screwed up that corporations now have access to something like sovereign immunity [1]: the ability to not be sued in court by their customers or employees unless they consent to the suit. [1] https://en.wikipedia.org/wiki/Sovereign_immunity#United_States https://en.wikipedia.org/wiki/Sovereign_immunity#United_Stat...

mattmanser 8y ago
It is insane that the rule of law can be so easily circumvented by something as simple as an EULA and that law makers are totally ambivalent about essentially losing their power.
- Lionsion 8y ago
  > and that law makers are totally ambivalent about essentially losing their power. That "loss of power" may be welcomed by many lawmakers, many of whom are ideologically committed to "starving the [state]." [1] The current Chief Justice of the Supreme Court had a hand in designing and implementing this arbitration strategy, before he was appointed to the court. Afterwards he supported it in his opinions. [2] The current head of the Consumer Finance Protection Bureau is actively trying to undermine its mission [3], and wants to shift its focus away from consumer protection to "business costs." [4] [1] https://en.wikipedia.org/wiki/Starve_the_beast https://en.wikipedia.org/wiki/Starve_the_beast [2] https://www.nytimes.com/2015/11/01/business/dealbook/arbitration-everywhere-stacking-the-deck-of-justice.html https://www.nytimes.com/2015/11/01/business/dealbook/arbitra... [3] http://www.latimes.com/business/lazarus/la-fi-lazarus-mulvaney-killing-the-cfpb-20180417-story.html http://www.latimes.com/business/lazarus/la-fi-lazarus-mulvan... [4] https://www.wsj.com/articles/mulvaney-to-prioritize-business-costs-in-cfpb-reorganization-1525972114 https://www.wsj.com/articles/mulvaney-to-prioritize-business...
  - Domenic_S 8y ago
    I’m out.
    - blindwatchmaker 8y ago
      I found your explanation a lot more weird and a lot less simpler than the parent.
      - philwelch 8y ago
        One of the things that makes conspiracy theories so appealing is their simplicity.
        Lionsion 8y ago
        > One of the things that makes conspiracy theories so appealing is their simplicity. What exactly is the conspiracy theory here?
        philwelch 8y ago
        "Legalizing forced arbitration is a right-wing conspiracy to reduce the scale of government".
        Lionsion 8y ago
        > "Legalizing forced arbitration is a right-wing conspiracy to reduce the scale of government". I figured that's what you'd say. I think you misunderstand the meaning and connotations of the term "conspiracy theory." It doesn't mean, literally, "a theory that a group is conspiring." A true conspiracy theory, at its core, is an outrageous and unbelievable idea that gets elaborated on to an unreasonable degree. Think UFO coverups and black helicopters of the New World Order. It's not outragious and unreasonable to think "the right wing" is acting together to "reduce the scale of government" or support "business friendly" polices like binding arbitration at the expense of consumers. They literally campaign, in public, on those and similar ideas.
- CobrastanJorji 8y ago
  The counterargument is that you are welcome not to do business with companies that require you to accept such a condition, just as you are welcome not to accept a job with such a condition. Unemployment rates are about as low as they ever get right now; work somewhere else. Freedom means that you can voluntarily enter into arrangements that others think are a bad idea. Is it worth a little extra pay to accept that condition? A lot of extra pay? The market will figure it out. Banning the practice, on the other hand, removes a bit of freedom. Of course, that argument is largely baloney, but it's not straight up insane.
  - fwdpropaganda 8y ago
    > The counterargument is that you are welcome not to do business with companies (...) Of course, that argument is largely baloney, but it's not straight up insane. This is the idea of "freedom" that the right wing loves pushing, that all things that matter can be discussed as one-to-one interactions. The argument is baloney because if all companies do it you don't really have a choice. You won't see this fact if you always think in terms of one-to-one interactions. "Freedom" as one-to-one interactions is structurally favorable to large corporations.
    - Domenic_S 8y ago
      I’m out.
      - Lionsion 8y ago
        > I’m out. So do you admit you're wrong to the degree you think your comments shouldn't be seen? Or can you just not stand the downvotes? I think withdrawing and mass deleting half of a conversation is kinda bad form.
        fwdpropaganda 8y ago
        Yes, he admits. Go through his comment history and it's nothing but unsubstantive and/or snarky remarks. I wish there was a way to detect these people at a glance so that I'd have saved myself the time. Maybe a metric like karma per year? Very gameable, but maybe better than nothing? This guy's account is 7 years old and has 3k karma. Or maybe karma per comment.
- smallbigfish 8y ago
  Is this an US thing? I always assumed that no contract can be "above" the law. In fact I just checked the Constitution in my country and it specifically says that no other law can cancel the fact anyone can address justice.
  - jkaplowitz 8y ago
    Many countries allow binding pre-dispute arbitration agreements if two businesses negotiate a contract with each other and agree to that. Countries get more skeptical when it's in standard seemingly non-negotiable language from one of the businesses. Most countries get very skeptical and often ban pre-dispute binding arbitration when one party is an employee or a consumer, especially if the other party drafted the language. In the last few decades, the US has become the exception to that. All countries I'm aware of (probably not including your country) will allow consumers and businesses to agree to arbitrate a dispute that has already arisen, with binding effect.
  - sandworm101 8y ago
    >> I always assumed that no contract can be "above" the law. Law and justice are different things. This is about lawsuits, demanding money as compensation for wrongs. Lawsuits are about settlements and confidential agreements negotiated between parties. Justice is a matter for criminal courts. Justice is about the government punishing people who break laws. That cannot be usurped by contract. Uber employees who break the law are still prosecuted regardless of eulas.
    - gowld 8y ago
      I don't think your explanation properly explains torts. "Criminal" laws cover violations against the State (crimes). Civil laws are violations against individuals (torts). Torts are absolutely part of the Justice system. https://en.wikipedia.org/wiki/Tort https://en.wikipedia.org/wiki/Tort
      - sandworm101 8y ago
        We can debate minutia of legal doctrine forever. Torts don't require civil laws, only civil wrongs. Whether or not they are part of the "justice system" is also different than the concept of "justice".
- dragonwriter 8y ago
  The rule of law isn't circumvented by EULAs; if the law prohibited the terms, they would be invalid. The rule of law supports the EULAs. Now, you may think that the law is bad, but that's different from this being a failure of the rule of law; it's success in the rule of (bad) law.
- segmondy 8y ago
  We should add something to an EULA that says something to the effect that if someone is a Police officer they can never arrest the creator or community of a software or if they are a lawyer/judge they can never judge. It do be interesting to see how the govt reacts to that.
  - gowld 8y ago
    As an example, we've had cases where judges/clerks refuse to do their jobs (certify marriages) based on their personal choices. The institution provides a substitute, possibly terminating the employment of the individual who chooses to not do their job to minimum required standards.
- deleted 8y ago
  [deleted]
dawnerd 8y ago
Similarly forcing people to opt out of potential class-action lawsuits. How thats even legal is beyond me.
deleted 8y ago
[deleted]
mindslight 8y ago
Forced arbitration is beyond illegal, it is illogical. The entire basis of a contract is that it's a meeting of minds. If a written agreement purports that one party to it has the power to unilaterally interpret it, then its very words lack all independent meaning. And without meaning, there is no actual contract!
- icebraining 8y ago
  purports that one party to it has the power to unilaterally interpret it That's not what it does. I think arbitration (except between companies) is dangerous, but arbitration doesn't mean one party decides, but a third-party (arbitrator).
  - PurpleBoxDragon 8y ago
    The problem is that the third party is often picked, to some degree, by one of the parties, and there is a perverse incentive between the third party and the party that is picking them.
    - icebraining 8y ago
      That's why I think they're dangerous, as I wrote. But they're not illogical.
  - mindslight 8y ago
    That "third party" arbitrator is effectively an agent of one party. There isn't a vibrant market for arbitrators. A consumer-oriented one clearly wouldn't be approved by the industry board, and so couldn't be chosen even if the consumer would pay for it. It's a dog and pony show to conjure a purportedly neutral third party, but that "third party's" ongoing business relies on delivering the company's desired outcome. Hence, agent. Furthermore, the deeper repudiation of meaning is the assertion that the arbitrator's decision is exempt from review by a proper court.
    - Matticus_Rex 8y ago
komali2 8y ago
I've never actually heard of an arbitration clause surviving in court though, do you have any examples of a pitched battle being fought over this?
- okmokmz 8y ago
  https://www.law.com/njlawjournal/sites/njlawjournal/2017/12/14/arbitration-agreement-upheld-in-retail-workers-employment-dispute/?slreturn=20180415140443 https://www.law.com/njlawjournal/sites/njlawjournal/2017/12/... https://www.lexology.com/library/detail.aspx?g=be6405e6-3397-4981-b8bb-8d6e90396e28 https://www.lexology.com/library/detail.aspx?g=be6405e6-3397... https://www.muchshelist.com/insights/article/us-supreme-court-again-upholds-arbitration-clauses https://www.muchshelist.com/insights/article/us-supreme-cour...
dalbasal 8y ago
This is true, mandatory arbitration makes mockery of the legal system. But... the whole arbitration thing is itself a reaction (in many cases^) to general suckness of the legal system which is primitive, clunky, slow and often more trouble then the trouble it's trying to solve. It's wide open to abuse, and a lot of what we call law is in practice a mature "game" based on abuse of the legal system. So, yep.. these should be ilegal. But we also need a legal system capable of functional resolution of these disputes fast, without abuses, mutual destruction stalemates and burdensome "costs" including eventualities such as "as an employer, you will always be in labour court no matter what." That said, sexual harassment in the workplace is an "our vision of society" type of problem. There's a case for giving it it's own courts or public dispute resolution frameworks. Law really needs to evolve. We are not settling disputes between norman kings and saxon lords any more. ^sometimes it's just naked self interest. Ie, We will win more often in private arbitration, so let's write it into the contract and hope they don't notice or are not in a position to object .
- scrupt 8y ago
  That said, sexual harassment in the workplace is an "our vision of society" type of problem. Please elaborate.
- apendleton 8y ago
  > Law really needs to evolve. We are not settling disputes between norman kings and saxon lords any more. I agree, but funnily, I think the thing the legal system would evolve into in order to facilitate "functional resolution of these disputes fast, without abuses, mutual destruction stalemates" etc. would end up looking a lot like independent binding arbitration.
- rayiner 8y ago
  > But... the whole arbitration thing is itself a reaction (in many cases^) to general suckness of the legal system which is primitive, clunky, slow and often more trouble then the trouble it's trying to solve. It's wide open to abuse, and a lot of what we call law is in practice a mature "game" based on abuse of the legal system. Maybe. It's interesting to note that businesses still prefer court to arbitration in their disputes with each other. https://www.nytimes.com/2008/10/06/business/06arbitrate.html https://www.nytimes.com/2008/10/06/business/06arbitrate.html. And business-to-business arbitrations tend to have many of the procedures (and expense) of litigation--lawyers, briefing, hearings, etc. The biggest advantage is that arbitration can be lot faster, because the civil court system is so overloaded with cases.

mattmanser 8y ago

It is insane that the rule of law can be so easily circumvented by something as simple as an EULA and that law makers are totally ambivalent about essentially losing their power.

Lionsion 8y ago
> and that law makers are totally ambivalent about essentially losing their power. That "loss of power" may be welcomed by many lawmakers, many of whom are ideologically committed to "starving the [state]." [1] The current Chief Justice of the Supreme Court had a hand in designing and implementing this arbitration strategy, before he was appointed to the court. Afterwards he supported it in his opinions. [2] The current head of the Consumer Finance Protection Bureau is actively trying to undermine its mission [3], and wants to shift its focus away from consumer protection to "business costs." [4] [1] https://en.wikipedia.org/wiki/Starve_the_beast https://en.wikipedia.org/wiki/Starve_the_beast [2] https://www.nytimes.com/2015/11/01/business/dealbook/arbitration-everywhere-stacking-the-deck-of-justice.html https://www.nytimes.com/2015/11/01/business/dealbook/arbitra... [3] http://www.latimes.com/business/lazarus/la-fi-lazarus-mulvaney-killing-the-cfpb-20180417-story.html http://www.latimes.com/business/lazarus/la-fi-lazarus-mulvan... [4] https://www.wsj.com/articles/mulvaney-to-prioritize-business-costs-in-cfpb-reorganization-1525972114 https://www.wsj.com/articles/mulvaney-to-prioritize-business...
- Domenic_S 8y ago
  I’m out.
  - blindwatchmaker 8y ago
    I found your explanation a lot more weird and a lot less simpler than the parent.
    - philwelch 8y ago
      One of the things that makes conspiracy theories so appealing is their simplicity.
      - Lionsion 8y ago
        > One of the things that makes conspiracy theories so appealing is their simplicity. What exactly is the conspiracy theory here?
        philwelch 8y ago
        "Legalizing forced arbitration is a right-wing conspiracy to reduce the scale of government".
        Lionsion 8y ago
        > "Legalizing forced arbitration is a right-wing conspiracy to reduce the scale of government". I figured that's what you'd say. I think you misunderstand the meaning and connotations of the term "conspiracy theory." It doesn't mean, literally, "a theory that a group is conspiring." A true conspiracy theory, at its core, is an outrageous and unbelievable idea that gets elaborated on to an unreasonable degree. Think UFO coverups and black helicopters of the New World Order. It's not outragious and unreasonable to think "the right wing" is acting together to "reduce the scale of government" or support "business friendly" polices like binding arbitration at the expense of consumers. They literally campaign, in public, on those and similar ideas.
CobrastanJorji 8y ago
The counterargument is that you are welcome not to do business with companies that require you to accept such a condition, just as you are welcome not to accept a job with such a condition. Unemployment rates are about as low as they ever get right now; work somewhere else. Freedom means that you can voluntarily enter into arrangements that others think are a bad idea. Is it worth a little extra pay to accept that condition? A lot of extra pay? The market will figure it out. Banning the practice, on the other hand, removes a bit of freedom. Of course, that argument is largely baloney, but it's not straight up insane.
- fwdpropaganda 8y ago
  > The counterargument is that you are welcome not to do business with companies (...) Of course, that argument is largely baloney, but it's not straight up insane. This is the idea of "freedom" that the right wing loves pushing, that all things that matter can be discussed as one-to-one interactions. The argument is baloney because if all companies do it you don't really have a choice. You won't see this fact if you always think in terms of one-to-one interactions. "Freedom" as one-to-one interactions is structurally favorable to large corporations.
  - Domenic_S 8y ago
    I’m out.
    - Lionsion 8y ago
      > I’m out. So do you admit you're wrong to the degree you think your comments shouldn't be seen? Or can you just not stand the downvotes? I think withdrawing and mass deleting half of a conversation is kinda bad form.
      - fwdpropaganda 8y ago
        Yes, he admits. Go through his comment history and it's nothing but unsubstantive and/or snarky remarks. I wish there was a way to detect these people at a glance so that I'd have saved myself the time. Maybe a metric like karma per year? Very gameable, but maybe better than nothing? This guy's account is 7 years old and has 3k karma. Or maybe karma per comment.
smallbigfish 8y ago
Is this an US thing? I always assumed that no contract can be "above" the law. In fact I just checked the Constitution in my country and it specifically says that no other law can cancel the fact anyone can address justice.
- jkaplowitz 8y ago
  Many countries allow binding pre-dispute arbitration agreements if two businesses negotiate a contract with each other and agree to that. Countries get more skeptical when it's in standard seemingly non-negotiable language from one of the businesses. Most countries get very skeptical and often ban pre-dispute binding arbitration when one party is an employee or a consumer, especially if the other party drafted the language. In the last few decades, the US has become the exception to that. All countries I'm aware of (probably not including your country) will allow consumers and businesses to agree to arbitrate a dispute that has already arisen, with binding effect.
- sandworm101 8y ago
  >> I always assumed that no contract can be "above" the law. Law and justice are different things. This is about lawsuits, demanding money as compensation for wrongs. Lawsuits are about settlements and confidential agreements negotiated between parties. Justice is a matter for criminal courts. Justice is about the government punishing people who break laws. That cannot be usurped by contract. Uber employees who break the law are still prosecuted regardless of eulas.
  - gowld 8y ago
    I don't think your explanation properly explains torts. "Criminal" laws cover violations against the State (crimes). Civil laws are violations against individuals (torts). Torts are absolutely part of the Justice system. https://en.wikipedia.org/wiki/Tort https://en.wikipedia.org/wiki/Tort
    - sandworm101 8y ago
      We can debate minutia of legal doctrine forever. Torts don't require civil laws, only civil wrongs. Whether or not they are part of the "justice system" is also different than the concept of "justice".
dragonwriter 8y ago
The rule of law isn't circumvented by EULAs; if the law prohibited the terms, they would be invalid. The rule of law supports the EULAs. Now, you may think that the law is bad, but that's different from this being a failure of the rule of law; it's success in the rule of (bad) law.
segmondy 8y ago
We should add something to an EULA that says something to the effect that if someone is a Police officer they can never arrest the creator or community of a software or if they are a lawyer/judge they can never judge. It do be interesting to see how the govt reacts to that.
- gowld 8y ago
  As an example, we've had cases where judges/clerks refuse to do their jobs (certify marriages) based on their personal choices. The institution provides a substitute, possibly terminating the employment of the individual who chooses to not do their job to minimum required standards.
deleted 8y ago
[deleted]

dawnerd 8y ago

Similarly forcing people to opt out of potential class-action lawsuits. How thats even legal is beyond me.

deleted 8y ago

[deleted]

mindslight 8y ago

Forced arbitration is beyond illegal, it is illogical. The entire basis of a contract is that it's a meeting of minds. If a written agreement purports that one party to it has the power to unilaterally interpret it, then its very words lack all independent meaning. And without meaning, there is no actual contract!

icebraining 8y ago
purports that one party to it has the power to unilaterally interpret it That's not what it does. I think arbitration (except between companies) is dangerous, but arbitration doesn't mean one party decides, but a third-party (arbitrator).
- PurpleBoxDragon 8y ago
  The problem is that the third party is often picked, to some degree, by one of the parties, and there is a perverse incentive between the third party and the party that is picking them.
  - icebraining 8y ago
    That's why I think they're dangerous, as I wrote. But they're not illogical.
- mindslight 8y ago
  That "third party" arbitrator is effectively an agent of one party. There isn't a vibrant market for arbitrators. A consumer-oriented one clearly wouldn't be approved by the industry board, and so couldn't be chosen even if the consumer would pay for it. It's a dog and pony show to conjure a purportedly neutral third party, but that "third party's" ongoing business relies on delivering the company's desired outcome. Hence, agent. Furthermore, the deeper repudiation of meaning is the assertion that the arbitrator's decision is exempt from review by a proper court.
  - Matticus_Rex 8y ago

komali2 8y ago

I've never actually heard of an arbitration clause surviving in court though, do you have any examples of a pitched battle being fought over this?

okmokmz 8y ago
https://www.law.com/njlawjournal/sites/njlawjournal/2017/12/14/arbitration-agreement-upheld-in-retail-workers-employment-dispute/?slreturn=20180415140443 https://www.law.com/njlawjournal/sites/njlawjournal/2017/12/... https://www.lexology.com/library/detail.aspx?g=be6405e6-3397-4981-b8bb-8d6e90396e28 https://www.lexology.com/library/detail.aspx?g=be6405e6-3397... https://www.muchshelist.com/insights/article/us-supreme-court-again-upholds-arbitration-clauses https://www.muchshelist.com/insights/article/us-supreme-cour...

dalbasal 8y ago

This is true, mandatory arbitration makes mockery of the legal system. But... the whole arbitration thing is itself a reaction (in many cases^) to general suckness of the legal system which is primitive, clunky, slow and often more trouble then the trouble it's trying to solve. It's wide open to abuse, and a lot of what we call law is in practice a mature "game" based on abuse of the legal system. So, yep.. these should be ilegal. But we also need a legal system capable of functional resolution of these disputes fast, without abuses, mutual destruction stalemates and burdensome "costs" including eventualities such as "as an employer, you will always be in labour court no matter what." That said, sexual harassment in the workplace is an "our vision of society" type of problem. There's a case for giving it it's own courts or public dispute resolution frameworks. Law really needs to evolve. We are not settling disputes between norman kings and saxon lords any more. ^sometimes it's just naked self interest. Ie, We will win more often in private arbitration, so let's write it into the contract and hope they don't notice or are not in a position to object .

scrupt 8y ago
That said, sexual harassment in the workplace is an "our vision of society" type of problem. Please elaborate.
apendleton 8y ago
> Law really needs to evolve. We are not settling disputes between norman kings and saxon lords any more. I agree, but funnily, I think the thing the legal system would evolve into in order to facilitate "functional resolution of these disputes fast, without abuses, mutual destruction stalemates" etc. would end up looking a lot like independent binding arbitration.
rayiner 8y ago
> But... the whole arbitration thing is itself a reaction (in many cases^) to general suckness of the legal system which is primitive, clunky, slow and often more trouble then the trouble it's trying to solve. It's wide open to abuse, and a lot of what we call law is in practice a mature "game" based on abuse of the legal system. Maybe. It's interesting to note that businesses still prefer court to arbitration in their disputes with each other. https://www.nytimes.com/2008/10/06/business/06arbitrate.html https://www.nytimes.com/2008/10/06/business/06arbitrate.html. And business-to-business arbitrations tend to have many of the procedures (and expense) of litigation--lawyers, briefing, hearings, etc. The biggest advantage is that arbitration can be lot faster, because the civil court system is so overloaded with cases.