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Article

2 Nov 2015

Author:
Jessica Silver-Greenberg & Michael Corkery, New York Times (USA)

USA: New York Times investigation shows most firms force employees & clients into arbitration

"In Arbitration, a 'Privatization of the Justice System'", 1 Nov 2015

Over the last 10 years, thousands of businesses across the country — from big corporations to storefront shops — have used arbitration to create an alternate system of justice. There, rules tend to favor businesses, and judges and juries have been replaced by arbitrators who commonly consider the companies their clients, The Times found…All it took was adding simple arbitration clauses to contracts that most employees and consumers do not even read…For companies, the allure of arbitration grew after a 2011 Supreme Court ruling cleared the way for them to use the clauses to quash class-action lawsuits. Prevented from joining together as a group in arbitration, most plaintiffs gave up entirely, records show…Little is known about arbitration because the proceedings are confidential and the federal government does not require cases to be reported…Some plaintiffs said…that arbitration had helped to resolve their disputes quickly without the bureaucratic headaches of going to court. Some said the arbitrators had acted professionally and without bias…Unfettered by strict judicial rules against conflicts of interest, companies can steer cases to friendly arbitrators. In turn, interviews and records show, some arbitrators cultivate close ties with companies to get business…[I]n interviews with The Times, more than three dozen arbitrators described how they felt beholden to companies. Beneath every decision, the arbitrators said, was the threat of losing business…[Also refers to CashCall, Honda]