Advocates Applaud Councilmember Mendelson's Withdrawal of Anti-Consumer Bill |
- Uniform Arbitration Act Would Have Rolled Back Consumer Access to Justice
-
WASHINGTON, Dec. 6 /PRNewswire/ -- A campaign supported by the nation's
leading civil rights and consumer groups applauded yesterday's decision by
the D.C. Councilmember Phil Mendelson to kill a bill that would have
institutionalized a second-class system of justice for the powerless. The
so- called "Revised Uniform Arbitration Act" was designed to make it harder
for a consumer to get out of arbitration or appeal an arbitrator's decision
-- even if that decision demonstrated "manifest disregard for law,"
according to a member of the commission responsible for drafting the
legislation.
"Only 12 states have ever enacted this legislation because it fails to
balance consumer rights with the rights of business interests," said
campaign coordinator Valkyrie Hanson, "and most of these states have
modified it to make it more consumer-friendly. The District's version was
even worse than the original because it had a Trojan Horse provision that
eliminated the right to punitive damages and attorneys' fees."
The bill, B16-146, was introduced by Mendelson and approved by the
Judiciary Committee on November 14. But he moved to send it back to the
Judiciary Committee during the Dec. 5 Legislative Meeting, when the extent
of its potentially harmful impact on consumers became clear. This
procedural step, which was unopposed, effectively killed the bill for this
year.
The bill would have legalized many of the abuses of arbitration,
eliminating protections developed by the American judicial system over the
course of hundreds of years to ensure the just resolution of disputes.
Furthermore, it would have permitted businesses to prohibit consumers from
joining class actions, allowed insurers to demand that policyholders waive
the right to go to court in return for insurance coverage, and left
District residents strangled by arbitration agreements even where federal
law did not require it.
Arbitration is an alternative method of resolving conflicts in which
two parties present their individual sides of a complaint to an arbitrator
or panel of arbitrators. Its proceedings are secret and more expensive than
going to court and arbitrators are not required to follow the law in making
decisions. Binding mandatory arbitration is increasingly imposed on
consumers as a condition of doing business with a company, such as
obtaining a credit card, or health insurance, or even a job. Often these
oppressive arbitration provisions are hidden in the fine print of form
contracts, and consumers only find out that they have given up important
constitutional rights after it is too late.
As the group wrote in a letter to the Council: "Arbitration is a secret
process with no accountability, fewer procedural safeguards than the court
system, limited remedies and only a narrow right to appeal. Arbitration is
also prohibitively expensive for consumers, which may prevent them from
pursuing a claim at all. Furthermore, arbitration is often biased towards
business entities -- the repeat customers that designate their most loyal
arbitrators to judge disputes on their behalf."
"Instead of making it harder to obtain justice when corporations lie or
cheat consumers, the D.C. Council should be strengthening protections for
its residents. Fifteen states already refuse to enforce arbitration clauses
in insurance contracts, and some states set ethical standards for
arbitrators. The District should not allow industry to stack the deck
against its citizens," concluded Hanson.
The Give Me Back My Rights Coalition
(http://www.GiveMeBackMyRights.com) represents over 25 consumer, employee
and civil rights groups nationwide that have come together to raise
awareness about the dangers of pre-dispute binding arbitration clauses in
consumer and employment contracts, and to push for remedial legislation at
the state and federal levels.
SOURCE Give Me Back My Rights Coalition
back to topRelated links:
CONTACT:
Valkyrie Hanson of Give Me Back My Rights
Coalition, +1-202-452-1989 x104; or Jillian Aldebron of Center
for Responsible Lending, +1-202-349-1868
