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California can require the company to pay the all or the majority of fees for arbitration, and this has been used by large groups of individuals to band togethe

California can require the company to pay the all or the majority of fees for arbitration, and this has been used by large groups of individuals to band together and arbitrate at the same time, costing great deals of money and burden to a company, forcing them to settle. https://news.bloomberglaw.com/daily-labor-report/uber-sees-wage-suits-dropped-including-12-501-arbitration-claims https://news.bloomberglaw.com/daily-labor-report/uber-sees-w... The 60k arbitration claims could of cost $75m in fees alone, not to mention it can be 9k/day to pay the arbitrators themselves. So they settled for $146m. There are a few other cases of this, and I am sure there will be more collective action through mass arbitration. I imagine eventually it will come to being abused as well.

gamblor956 7y ago
If a business is facing 60000 arbitration claims from customers they are not a small business anymore and presumably should be able to handle the burden of arbitration customer disputes.
- olliej 7y ago
  You’d presume so, but in fact they cannot. The reason that so many companies adopted forced arbitration was explicitly because it made such actions uneconomical for consumers to actually enter arbitration. The moment large groups of individuals start making use of the forced arbitration every company has tried to get the courts to let them get out of arbitration that they inflicted on others. It is well established that forced arbitration has nothing to do about efficiency for company vs individual and is specifically because it is a system designed to protect companies from culpability.
  - gamblor956 7y ago
    I was a licensed arbitrator. I am aware of how arbitration works and what it is supposed to accomplish. My point was that a business with at least 60000 customers is not a very small business. It's a sizable business that should have the resources to defend itself in the 60000 arbitration cases that it chose to force upon its customers.
    - olliej 7y ago
      Sorry, I just want to clarify as I may have misread "should" (English is a marvelous language :D ) Are you saying that you expect them to have the resources, or are you saying that the businesses should be budgeting to support responding to large scale arbitration?
- dahfizz 7y ago
  That doesn't make sense at all. Just because a business is large doesn't mean they are high margin or have infinite money. If McDonald's had to pay $9000/day in arbitration for every one of their billions of customers, they would spend more than their market cap in a few minutes. The whole point is that these companies have to pay for arbitration for each customer, rather than e.g. a single class action law suit. So unless you make over $9000 per day off your customers, you're going to lose big time.
  - gamblor956 7y ago
    The whole point of companies forcing arbitration clauses onto their customers was to save money by denying customers the appropriate legal avenue for recourse. If the company didn't want to face 60000 arbitration cases they shouldn't have blocked their customers from filing a single class action lawsuit.
    - dahfizz 7y ago
      I agree with you. With collective action this can become a very powerful tool for consumers, and just saying "they're a big company they can afford it" really misses the point.
    - sincerely 7y ago
      Well said

gamblor956 7y ago

If a business is facing 60000 arbitration claims from customers they are not a small business anymore and presumably should be able to handle the burden of arbitration customer disputes.

olliej 7y ago
You’d presume so, but in fact they cannot. The reason that so many companies adopted forced arbitration was explicitly because it made such actions uneconomical for consumers to actually enter arbitration. The moment large groups of individuals start making use of the forced arbitration every company has tried to get the courts to let them get out of arbitration that they inflicted on others. It is well established that forced arbitration has nothing to do about efficiency for company vs individual and is specifically because it is a system designed to protect companies from culpability.
- gamblor956 7y ago
  I was a licensed arbitrator. I am aware of how arbitration works and what it is supposed to accomplish. My point was that a business with at least 60000 customers is not a very small business. It's a sizable business that should have the resources to defend itself in the 60000 arbitration cases that it chose to force upon its customers.
  - olliej 7y ago
    Sorry, I just want to clarify as I may have misread "should" (English is a marvelous language :D ) Are you saying that you expect them to have the resources, or are you saying that the businesses should be budgeting to support responding to large scale arbitration?
dahfizz 7y ago
That doesn't make sense at all. Just because a business is large doesn't mean they are high margin or have infinite money. If McDonald's had to pay $9000/day in arbitration for every one of their billions of customers, they would spend more than their market cap in a few minutes. The whole point is that these companies have to pay for arbitration for each customer, rather than e.g. a single class action law suit. So unless you make over $9000 per day off your customers, you're going to lose big time.
- gamblor956 7y ago
  The whole point of companies forcing arbitration clauses onto their customers was to save money by denying customers the appropriate legal avenue for recourse. If the company didn't want to face 60000 arbitration cases they shouldn't have blocked their customers from filing a single class action lawsuit.
  - dahfizz 7y ago
    I agree with you. With collective action this can become a very powerful tool for consumers, and just saying "they're a big company they can afford it" really misses the point.
  - sincerely 7y ago
    Well said