I was just going to check if you'd seen this poll.

The poll was quite flawed, in that it asked the individuals the following:

"I am going to read you a list of different ways to resolve disputes between companies and consumers. Please tell me, as I read each one, is your opinion of that way to resolve disputes between companies and consumers very favorable, mostly favorable, half-and-half, mostly unfavorable, or – very unfavorable. If I mention one that you are unfamiliar with just tell me and we’ll move on to the next one."

They then didn't provide specifics about how many people didn't understand the dispute resolution technique. As it was, most people favored mediation, which business also doesn't like.

The question on arbitration and agreements than asks:

"Now suppose for a moment you had to sign a contract with a company when you purchased their goods or services. If you could choose the method by which any serious dispute would be settled between you and the company, which would you choose? Arbitration, which does not require going to court ...or... Litigation, which does require a lawsuit and going to court."

From this they get

"Voters strongly believe Congress should NOT remove arbitration agreements from the contracts consumers sign with companies providing goods and services."

However, they neglected to mention that this agreement would also entail giving up the person's right to court if they change their mind later, as well as having to have the arbitration handled by a private for-profit corporation hand picked by the corporation.

I was involved in an 'arbitration' act with a company in December of 2006. I challenged the arbitration, saying we had no agreement, I had never done business with the company, and the company did not provide the document in which the clause containing the arbitration agreement was enclosed. The company actually submitted fraudulent replies to support their action. In fact, they even submitted two arbitration agreements -- one for one company, based in Delaware, specifying NAF as the arbitration company; one for another company, based in North Dakota, and specifying that AAA would be the arbitration company. They did so because I pointed out that under the Delaware agreement, the issue was past the state's SOL. However, the issue would not be past the SOL for North Dakota.

I pointed out that the company had committed fraud in its arbitration filing, not only lying about the circumstances, but even about the arbitration agreement, itself, but the arbitrator still ruled in the company's favor. More than that, the arbitrator tacked on several thousands of dollars in lawyer and arbitration fees, though this was expressly prohibited in "both" arbitration agreements.

I waited a year to see if the company would file for judgement, and the time past this last January. Of course they didn't, they know they would have lost. Now I'm strongly considering filing suit in federal court against the company, NAF, and the arbitrator, based on this blatant and breathlessly idiotic fraud. So much for the 'fairness' of the arbitration process.

Anecdotes aside, this all goes back to one thing: if arbitration is so good for the consumers, why does it have to be included as a condition of the contract? Wouldn't consumers pick this option, anyway? And if it is a condition of the contract, why then does the consumer have to use the arbitration organization that the corporation picks? If they're all fair and unbiased, then shouldn't the company allow the consumer/employee the right to pick the arbitration firm to use, if they're the one bringing action?

Finally, the FAA states that only the courts can decide whether an arbitration agreement exists if it's challenged, but the arbitrators make this decision themselves, rather than staying the action until the matter is resolved in court. The arbitrators blatantly violate the very act that forms the basis for their actions.

I'm speaking to the choir here, though. That "poll" is so flawed as to be laughable. But the deliberate attempt to obfuscate the issue is not funny.

"[I]f arbitration is so good for the consumers, why does it have to be included as a condition of the contract? Wouldn't consumers pick this option, anyway?"

Shelley, there's no right to arbitration. So without an abitration clause in a contract it's possible that a company could refuse to go to arbitration and use the traditional litigation process.

But in any event, I don't think anyone argues that arbitration is unvariably "good for the consumer." All else being equal, arbitration is good for the party that is entitled to judgment, because it enables them to get that judgment more efficiently. The practicailty of the matter is that within companies' business models is that they only sue costumers if the possibility of recovery is high (i.e., they're both entitled to judgment and they think they'll get it) so they almost invariably include mandatory arbitration clauses in consumer contracts. Litigation is very expensive for everyone involved.

In a competitive marketplace mandatory arbitration clauses in consumer contracts benefit consumers qua consumers through lower prices or otherwise more favorable contractual terms. With mandatory arbitration clauses accompanying their products, companies' revenue models project increased income because there is no longer the risk of protracted, costly litigation. They are thus able to offer more competitive products (e.g., lower priced products) versus their competitors while maintaining the same profit margin. To the extent that consumers favor such lower prices over the right to trial, other companies must follow suit. It is not unreasonable speculation to conclude this is what has happened and why mandatory binding arbitration contract pervade big-ticket consumer products or those that utilize recurring payment systems.

"In a competitive marketplace mandatory arbitration clauses in consumer contracts benefit consumers qua consumers through lower prices or otherwise more favorable contractual terms."

Prove it. Name of companies, and how much did consumers save by agreeing to BMA. Seriously, put your money where your rhetoric is. What companies have lowered prices because they've added BMA to consumer contracts. What companies charge less now than when they didn't have the BMA.

Bank of America? The company that's now charging even good credit risks 21 to 29 percent interest?

The drug companies, the ones that don't test their products, but still charge hundreds per month.

How about the phone companies, who extend phone contracts just because you've made a small change in your phone plan.

Seriously--give us names, give us figures. You seem well informed -- show us the money.

It's extraordinarily unlikely that Bank of America is "charging even good credit risks 21 to 29 percent interest." I have an unsecured rate from Citibank for 9 percent, helped in part by the mandatory arbitration clause in our contract.

Shelley:

The *physical* or *observational* proof you demand would require an amount of scientific rigor ill-suited, not to mention unnecessary, for our discussion. That's like me asking you to prove that they *don't* lower prices. I am reminded of Pope Clement's demanding that Copernicus physically prove that the Earth orbits around the Sun.

Not to mention that companies don't release their internal price discussions and analyses. This is for good reason, as such could violate antitrust laws.

In any event, it's elementary economic theory that in a competitive marketplace, where a company realizes a cost-savings it's passed on to consumers in order to make more sales than the company's competitors.

It is based on this economic law that courts generally presume that contract clauses limiting the scope of litigation lowers prices. See, e.g., Danka Funding, L.L.C. v. Page, Scrantom, Sprouse, Tucker & Ford, P.C., 21 F. Supp. 2d 465, 471 (D.N.J. 1998)("Despite defendant's arguments to the contrary, defendant can be presumed to have received appropriate consideration ... in the form of a lower price [in exchange for agreeing to a forum selection clause].") (citing Carnival Cruise Lines, Inc. v. Shutes, 499 U.S. 585 (1991)) (quotations omitted); see also Intermountain Sys., Inc. v. Edsall Const. Co., Inc., 575 F. Supp. 1195, 1197-98 (D. Colo. 1983) ("Whether Mr. Edsall discussed or specifically bargained about the venue provision is of little import. He is presumed to have received appropriate consideration, in the form of a lower price, for the venue selection clause.")

Shelley:

The *physical* or *observational* proof you demand would require an amount of scientific rigor ill-suited, not to mention unnecessary, for our discussion. That's like me asking you to prove that arbitration clauses *don't* lower prices. I am reminded of Pope Clement's demanding that Copernicus physically prove that the Earth orbits around the Sun such that His Holiness could observe it.

Not to mention that companies don't release their internal price discussions and analyses. This is for good reason, as such could violate antitrust laws.

In any event, it's elementary economic theory that in a competitive marketplace, where a company realizes a cost-savings it's passed on to consumers in order to make more sales than the company's competitors.

It is based on this economic law that courts generally presume that contract clauses limiting the scope of litigation lowers prices. See, e.g., Danka Funding, L.L.C. v. Page, Scrantom, Sprouse, Tucker & Ford, P.C., 21 F. Supp. 2d 465, 471 (D.N.J. 1998)("Despite defendant's arguments to the contrary, defendant can be presumed to have received appropriate consideration ... in the form of a lower price [in exchange for agreeing to a forum selection clause].") (citing Carnival Cruise Lines, Inc. v. Shutes, 499 U.S. 585 (1991)) (quotations omitted); see also Intermountain Sys., Inc. v. Edsall Const. Co., Inc., 575 F. Supp. 1195, 1197-98 (D. Colo. 1983) ("Whether Mr. Edsall discussed or specifically bargained about the venue provision is of little import. He is presumed to have received appropriate consideration, in the form of a lower price, for the venue selection clause.")

Shelley:

The *physical* or *observational* proof you demand would require an amount of scientific rigor ill-suited, not to mention unnecessary, for our discussion. That's like me asking you to prove that arbitration clauses *don't* lower prices. I am reminded of Pope Clement's demanding that Copernicus physically prove that the Earth orbits around the Sun such that His Holiness could observe it.

Not to mention that companies don't release their internal price discussions and analyses. This is for good reason, as such could violate antitrust laws.

In any event, it's elementary economic theory that in a competitive marketplace, where a company realizes a cost-savings it's passed on to consumers in order to make more sales than the company's competitors.

It is based on this economic law that courts generally presume that contract clauses limiting the scope of litigation lowers prices. See, e.g., Danka Funding, L.L.C. v. Page, Scrantom, Sprouse, Tucker & Ford, P.C., 21 F. Supp. 2d 465, 471 (D.N.J. 1998)("Despite defendant's arguments to the contrary, defendant can be presumed to have received appropriate consideration ... in the form of a lower price [in exchange for agreeing to a forum selection clause].") (citing Carnival Cruise Lines, Inc. v. Shutes, 499 U.S. 585 (1991)) (quotations omitted); see also Intermountain Sys., Inc. v. Edsall Const. Co., Inc., 575 F. Supp. 1195, 1197-98 (D. Colo. 1983) ("Whether Mr. Edsall discussed or specifically bargained about the venue provision is of little import. He is presumed to have received appropriate consideration, in the form of a lower price, for the venue selection clause.")

Lawyer, you write with a sense of surety the followin:

"In a competitive marketplace mandatory arbitration clauses in consumer contracts benefit consumers qua consumers through lower prices or otherwise more favorable contractual terms. With mandatory arbitration clauses accompanying their products, companies' revenue models project increased income because there is no longer the risk of protracted, costly litigation."

And then, when challenged, you respond with:

"The *physical* or *observational* proof you demand would require an amount of scientific rigor ill-suited, not to mention unnecessary, for our discussion. That's like me asking you to prove that they *don't* lower prices. I am reminded of Pope Clement's demanding that Copernicus physically prove that the Earth orbits around the Sun."

Then you quote some presumptions in a couple of cases, none of which is based on cold, hard facts, careful research, collected data. Not like a certain report in California that shows otherwise.

In other words, you have no proof, no statistics, nothing at all to substantiate your claim that BMA benefits the consumers by lowering prices. Nothing -- not even one company name. Not even one study.

The state of California certainly doesn't agree with you now. I am also encouraged now to follow my own suit against NAF. The more of us who do, the more the entire arbitration scam sees the light of day.

Hello Ted, here's another case for you where a nasty evil woman goes after that poor KBR in Iraq because she was raped. But if that's not enough, how KBR exposing people to extremely toxic substances.

That's your type of company, isn't it, Ted? In fact, I would say KBR is the poster child for arbitration. You must be proud.

As for BoA, Ted, here you go.

Bank of America indeed raised its rates to anyone who was a direct customer of any of the companies/banks it acquired to over 20% - 21% to 29% sounds about right - regardless of the customer's credit rating. I dropped any credit card I had which was acquired by BofA. In contrast, the interest on credit lines and credit cards I had with BofA directly, pre-acquisition of MBNA et al, which were low to begin with (beating your 9%), were lowered even further. Nevertheless, I closed those accounts too. BofA did not want to reason with me regarding the interest - which I luckily never have to pay anyway, since I pay my cards in full - on the credit cards it acquired. So, I surmised, since they don't try to keep my as a customer, they don't need my business. Well, they won't get it.

Bank of America indeed raised its rates to anyone who was a direct customer of any of the companies/banks it acquired to over 20% - 21% to 29% sounds about right - regardless of the customer's credit rating. I dropped any credit card I had which was acquired by BofA. In contrast, the interest on credit lines and credit cards I had with BofA directly, pre-acquisition of MBNA et al, which were low to begin with (beating your 9%), were lowered even further. Nevertheless, I closed those accounts too. BofA did not want to reason with me regarding the interest - which I luckily never have to pay anyway, since I pay my cards in full - on the credit cards it acquired. So, I surmised, since they don't try to keep my as a customer, they don't need my business. Well, they won't get it.

Bank of America indeed raised its rates to anyone who was a direct customer of any of the companies/banks it acquired to over 20% - 21% to 29% sounds about right - regardless of the customer's credit rating. I dropped any credit card I had which was acquired by BofA. In contrast, the interest on credit lines and credit cards I had with BofA directly, pre-acquisition of MBNA et al, which were low to begin with (beating your 9%), were lowered even further. Nevertheless, I closed those accounts too. BofA did not want to reason with me regarding the interest - which I luckily never have to pay anyway, since I pay my cards in full - on the credit cards it acquired. So, I surmised, since they don't try to keep my as a customer, they don't need my business. Well, they won't get it.

Shelley's claim was that BoA was charging 29% to "good credit risks." Her proof is an article showing BoA charging 28% to customers they judge to be bad credit risks. I rest my case.

deChelly demonstrates the power of the free market. If someone charges too much, don't do business with them. If they lose too much business, they will either have to reduce prices or go out of business in favor of those who provide a service people prefer.

The evidence from the free market is that people prefer the lower prices from mandatory arbitration to not having mandatory arbitration. If Shelley really believes that mandatory arbitration doesn't save money, she should take a business plan to George Soros, and Soros could spend his money introducing a credit-card that offers lower prices *and* advertises that it doesn't require arbitration. Customers will switch to the ShelleyCard, Shelley and Soros will make lots of money by providing a new service that consumers like, and mandatory arbitration will go away without having to spend a penny on anti-consumer-choice websites like TortDeform.

There are many many billionaires in the trial bar. Why are they fighting so hard to deprive consumers of choice through legislation forcing people to use trial lawyers instead of creating market alternatives? Special-interest groups like trial lawyers resort to legislation only when they can't get what they want in the free market. It's because consumers *want* mandatory arbitration that trial lawyers have to spend so much money on websites that lie about arbitration.

There Ted goes again, talking like an economist with his silly "incentives" and his "preferences" and his "prices" and his "markets" and his "choices." It's all a capitalist pig lie! Che for president!

There Ted goes again, talking like an economist with his silly "incentives" and his "preferences" and his "prices" and his "markets" and his "choices." It's all a capitalist pig lie! Che for president!

I had a longer comment in response to Lawyer that seems to have gone missing. No, I don't think it was filtered, I think it's literally missing--the comments functionality here is a problem.

Summarizing, Lawyer, you don't have any real facts to base your statement about companies saving money AND passing on the savings. Presumptions do not a hard fact make.

As for Ted, anyone else notice the rather repetitious nature of his comments? Somewhat like a Pro-Arbitration Ken doll: "Let's go arbitrate!" and "Courts are hard!" Much easier than actually presenting facts.

Ted, ultimately what the recent SF law suit demonstrates is that whether the arbitration fairness act happens or not, we are watching the industry now. Watching, and acting. It's only a matter of time. Get your corporate money now.

"Summarizing, Lawyer, you don't have any real facts to base your statement about companies saving money AND passing on the savings. Presumptions do not a hard fact make."

Shelley, there are many things I can't physically *show* you. I can't show you the earth rotates; or that microscopic germs exist; or that pi continues ad infinitum. This does not mean that such are merely "presumptions."

I envy your healthy skepticism, but it remains universally accepted that, in general, businesses compete for customers, and customers prefer cheaper goods. These are not "presumptions."

I don't have any transcript of a credit card Chairman, in the annual board meeting, declaring that "we've saved X amount of dollars through arbitration and we will now pass those savings on to customers through lower prices." In a way, it's amazing that you would bury your head in the sand until such could be given. So to you, I can only throw up my hands, and hope that someone else reading this is open to the "fact" that economics is a real science.

Shelley, the proof that arbitration saves money for consumers is the fact that you're resorting to anti-consumer legislation rather than pro-consumer competition. Again, if arbitration didn't save money for consumers, no one is stopping you from starting a credit card company that charged less and didn't have mandatory arbitration.

"I envy your healthy skepticism, but it remains universally accepted that, in general, businesses compete for customers, and customers prefer cheaper goods. These are not "presumptions."

I don't have any transcript of a credit card Chairman, in the annual board meeting, declaring that "we've saved X amount of dollars through arbitration and we will now pass those savings on to customers through lower prices." In a way, it's amazing that you would bury your head in the sand until such could be given. So to you, I can only throw up my hands, and hope that someone else reading this is open to the "fact" that economics is a real science."

In all of that, Lawyer, you didn't answer my question or provide a fact. You made an assertion earlier: arbitration saves money, consumers benefit. What are the facts to back up your assertion? None--you have no facts. Instead, you ramble on about economics being a real science. Well then, if this was all about competition, why is it that I haven't seen arbitration touted as a benefit to consumers? Why are arbitration clauses buried, hidden in small script, or included as mandatory clauses? Wouldn't the company state: sign this clause and we'll cut 10, 15, 20% off your bill or costs?

Ted, your statement about starting up a credit card company if we don't agree is an incredible absurd statement to make.

You both act like anyone who comes into this space will read what both of you write and agree: arbitration is good, courts are bad. I find it unlikely that anyone who will arrive at these comments are as stupid as you presume them to be.

However, Ted at least is baiting and I'm the only one foolish enough to keep biting. I won't do so anymore.

Make your comments -- you do binding mandatory arbitration clauses more harm then good with your silly arguments.

"[W]hy is it that I haven't seen arbitration touted as a benefit to consumers?"

Um, that's what I've been doing...

A median California consumer arbitration case takes duration 4.35 months for arbitration claims brought by individuals against businesses and 5.60 months for arbitration claims brought by businesses against individuals.

The median litigation length in the largest 75 U.S. counties is 19.4 months when individuals sue businesses in court and 15 months when businesses sue individuals.

The Review of New Jersey Judicial budget allocations shows that the taxpayers in that state save over $3,000 for each civil suit resolved through arbitration.

These are facts. Arbitration is cheaper than litigation. In litigation, assuming you're not hiring a NY lawyer, you have to pay $350 - $750 an hour for depositions (plus travel costs/meals/expenses of the lawyer), interrogatories, requests for disclosure, requests for addmission, phone calls, motions to quash, motions to dismiss, motions to strike, motions for summary judgment, evidentiary motions, motions in limine, trial motions, subpoenas, travel to the courthouse the numerous times, witness interviewing, counseling, and the summarization of thousands of pages of depositions. And you'd better hope you're opponent doesn't have any documents that need to be reviewed for evidentiary value, because that takes time and time costs money. Then, you have to pay for all filing fees, copying, printing, delivery, and court-reporters. Then, you have to worry about angry jurors who don't follow the law. Then you have all this again, on appeal. And with any luck, there'll be a mistrial, and you get to pay for all this all over again. Did I mention expert witnesses cost $2000 per hour?

Shelley, what exactly are you disagreeing with? The *fact* that arbitration reduces businesses' costs, or that businesses pass-on cost savings to customers through competition? To the vast majority of level-headed people these are not controversial positions. Only on the internet...I think I know a 9/11 conspiracy web-site you'd be interested in...

Lawyer, what is the basis for your facts? Which arbitration company opens its records, nationally, so that we can gather this information for ourselves?

You say arbitration is cheaper than litigation, but only if the two parties are equal in both capability and economic power. I agree that arbitration between a baseball team owner and the players is good, as I also agree that mediation between two neighbors squabbling over a fence line is good. But I don't agree, and you would have to show me the arbitration firm's records to prove otherwise, that arbitration is 'cheaper' in cases where, say, a person sues a corporation that owns a nursing home for the negligent death of his mother. The person will still need a lawyer, but because arbitration law is now so twisted about, most lawyers won't take on arbitration cases and the lawyer you can get charges more.

As a fact, it costs $49.00 I believe it is for me to file a suit in our associate circuit court system, about $30.00 for small claims court, but for something like NAF, you have to pay $400.00, at a minimum, for an equivalent experience.

You quote how long a case lasts in arbitration as compared to the court system in California, but you neglect to mention what type of case, or even give specifics where I can see this data for myself. I seriously doubt that, on average, a case reflecting a business suing an individual takes 19 months. I know it takes no more than a few months here in Missouri, and I do have proof because all cases have to be reflected in our state's case.net. Can you say the same in my state for NAF or any of the other arbitration companies?

The litigation you mention reflects some of the more complicated litigation, and doesn't necessarily reflect "average" cases. However, doing things right isn't always equivalent to doing things quickly.

You also neglect to mention that many cases that do require things such as "expert witnesses" are cases where the lawyer representing the individuals or groups of individuals pay all of the upfront costs associated with the cases, based on obtaining a percentage of the settlement--typically 40 percent. You may say that this is wrong, greedy lawyers, but I say that this is the only way most people like myself could ever go against a drug company, nursing home corporation, auto maker, or the like.

About those cases: arbitration records are sealed and the only way we learn about what has happened during the proceedings is if someone talks about them. We don't have the "facts" in order to learn that a drug can kill, a car's gas tank can explode or the car itself flip over, or that asbestos can have long-term effects. The very openness of our jury system has not only provided succor for those who sought remedy in the courts as a last recourse, they have informed a people and led to widespread changes in how many companies do business. Of course business doesn't want this: they like to operate in secrecy, the better to determine if it would be cheaper to pay out occasionally in arbitration, rather than make long-term changes in how they do business.

Do I doubt that business pasts cost savings on? Of course I do. We have in the news this week a story about arbitration with nursing homes cutting the costs of running those homes drastically, but that's balanced against the fact that the quality of care in the homes has suffered dramatically, as the costs to the elderly and their family, and to Medicare, has increased far beyond what can be explained by inflation. The corporations buy these home, force the elderly or their family into agreeing to arbitration clauses, fire more of the qualified staff, and consider the small costs of arbitration-based settlement "awards" to be an annoying nuisance, but one that doesn't cut into their profits.

As for the New Jersey residents not having to pay for arbitration, well if we didn't have war in Iraq, I bet the residents of New Jersey would save a ton of money not having to pay for our operations there. If we didn't have a road system, they could also save money. Let's also privatize the school systems so that only the rich can send their children to school. This will enable plentiful un-educated masses to wash our cars, tend our yards. And let's definitely not have any kind of universal health care because let's face it, the only ones who will die not having access to health care are people not worth saving.

A society has costs to continue to be a society. The alternative is a libertarian dream of anarchy where the rich barricade themselves behind their influence, always having to cast an uneasy eye out there, at the unwashed masses.

The Supreme Court has forgotten that the Constitution is a living document, because it is the last hope of a living people. The Supremes have forgotten what's important in their desire to support clean lines of demarcation between the haves and the have nots. The end result is that the Federal Arbitration Act, an act that was created to manage conflict between parties of equal economic power, has been perverted into a system of private justice that is an abomination of everything this country stands for.

Shelly, I think you misunderstand the discussion. The whole point is that arbitration is less expensive for *businesses.* That's how the costs-savings gets passed to consumers. So absorption of expert witness costs by plaintiff's lawyers, and cheap filing fees for consumers, are beside the point. (Although I'm sure consumers don't like paying for lengthy discovery any more than businesses).

"You say arbitration is cheaper than litigation, but only if the two parties are equal in both capability and economic power."

No, again, in almost every more-than-simple lawsuit, arbitration will be cheaper for a business than traditional litigation. It's, like, the whole point they're in so many contracts...

"As a fact, it costs $49.00 I believe it is for me to file a suit in our associate circuit court system, about $30.00 for small claims court, but for something like NAF, you have to pay $400.00, at a minimum, for an equivalent experience."

Shelley, again, you're missing the point. Businesses through arbitration clauses aren't trying to reduce the cost of suing -- they're reducing the costs of *getting sued*.

"[W]ell if we didn't have war in Iraq, I bet the residents of New Jersey would save a ton of money not having to pay for our operations there."

Good point -- since we're wasting money in Iraq, there's no point in saving money other places such as in our litigation system. In fact, since we're wasting money in Iraq, let's just waste all the money we have. Then we'll all just be totally broke. Because, after all, there's a war in Iraq -- what are we to do?

Last time I respond to you Lawyer, or whatever you are. If the Tort Deform folks don't feel like responding to you, I should follow their lead.

"No, again, in almost every more-than-simple lawsuit, arbitration will be cheaper for a business than traditional litigation. It's, like, the whole point they're in so many contracts..."

The whole point they're in many contracts is to eliminate the class action lawsuit, which scares the hell out of business.

I agree with you: arbitration is good for business, and bad for consumers. How nice to leave this discussion in agreement.

"I agree with you: arbitration is good for business, and bad for consumers."

Shelley, my point is that in a competitive business environment, what's good for business is *good* for consumers, to the extent that the "good" for business is something such as cost-reduction that can be passed on in the marketplace. (For example, the elimination of a business's competitor would most likely not be good for consumers). So we're actually in *disagreement*.