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Ken Margolin
Ken Margolin
Contributor •

Protecting Consumers from Binding Arbitration Clauses

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Big corporations love binding arbitration clauses. They are hidden in many contracts, requiring the individual to give up his or her right to a jury trial in the case of a dispute with the company. Some clauses attempt to block class actions. When large corporations are safe from class actions, they can cheat large numbers of people in small increments, knowing that paying off the few individuals who take the time to pursue justice, will be an acceptable cost of doing business.

Two Democratic congressmen, Senator Russ Feingold (D-WI) and Representative Hank Johnson (D-GA), propose to protect Americans from many binding arbitration clauses. They have introduced the Arbitration Fairness Act of 2007. The Act would declare pre-dispute binding arbitration clauses in the context of employment, consumer, franchise, and civil rights disputes, to be invalid and unenforceable. People Over Profits, sponsored by the American Association for Justice, backs the bill. The People Over Profits web site explains the bill, and makes it easy to let your senators and representatives know that you want the Arbitration Fairness Act of 2007, enacted into law.