There has existed for some time a tension between two provisions commonly found in consumer contracts of adhesion; i.e., the requirement that all claims be resolved by arbitration and the prohibition against any claims being pursued in a class action.
Large corporations see that combination as providing them with the greatest possible protection; the arbitration serves as a refuge from runaway jury verdicts, and the preclusion of class actions eliminates the risk of prodigious adverse awards when thousands of small claims are combined and pursued in one arbitration. But the double whammy imposed on consumers does more than provide comfort to manufacturers, financial institutions, brokerage firms and the like; in many cases, it effectively eliminates any right of recovery whatsoever.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
