Important News

ATTENTION: WE NEED FOLK'S TO MAKE CALLS TO ALL MEMBERS OF THE LEGISLATIVE BRANCH AND OUR PRESIDENT AND URGE THEM TO PASS THE ARBITRATION FAIRNESS ACT !!!

Man with Screw

May 7, 2013: U.S. Senator Al Franken and Congressman Hank Johnson have re-introduced legislation that would allow individuals to have their day in court. Contact your elected officials NOW; and tell them that co-sponsoring the "Arbitration Fairness Act" [S.878 and H.R. 1844] and pushing for expedited enactment is "the right thing to do" for their constituents. It is ULTRA IMPORTANT that we have Congressional leaders attend any hearings that may be scheduled so they can hear the disturbing testimony.

Pre-dispute Binding Mandatory Arbitration (BMA), also called Forced Arbitration, is an insidious way for employers and companies to evade accountability to clients, employees, and consumers. It's a practice that traps people into waiving their rights to sue, participate in a class-action lawsuit, or to appeal an unfair ruling.

Join me in convincing members of Congress to support the Arbitration Fairness Act, which would make contractual pre-dispute agreements to arbitrate employment, consumer, antitrust, or civil rights disputes unenforceable, and will end the practice of forcing employees and consumers to sign away their rights to legal protections and access to courts.

Binding Arbitration forces consumers to give up their right to sue in court, thrusting them (in legal handcuffs) into an astronomically expensive, "kangaroo court" held behind closed doors where the rules of law (time-tested court procedures and processes designed to produce impartial and fair justice) no longer apply. There is a symbiotic relationship between the company and the arbitration provider, the secretive proceedings are not public record, and there is no appeal. No media is allowed, and very few lawyers will take your case; they know you will probably lose in arbitration. Most victims of arbitration come out in shock; many are under gag orders, referred to as secrecy agreements, so they cannot tell what has been done to them. Consumers are lambs to the slaughter, and clueless when they meet this big bad wolf.

We consumers consent to this everyday, allowing it to continue. Those innocent-looking clauses buried in the small print of contracts and terms of agreements for car loans and leases, employment, insurance, home-building, credit cards, nursing facilities, and more; require that any dispute in the future, no matter how small or how large must go before a secretive tribunal, with no opportunity to negotiate [We want phone service - sign away your rights; we need to put Mom in a Nursing Home - sign away your rights]. Nursing Homes will accept your money, but are using these arbitration clauses to avoid legal responsibility for mistreatment of residents and to keep that information from the public through secrecy agreements.

People who buy new homes or renovate their homes can be the hardest hit monetarily, because they are dealing with contracts often worth many thousands of dollars. There are Veterans, even those totally disabled, living in deplorable conditions in new houses; young married couples suffering in shock; senior citizens... all have lost their homes, their savings, their credit, and their lives as they have known them. Their futures are ruined, and their families are destroyed. Most will never recover. Some are at the end of their ropes, and Binding Arbitration has been the cause of at least one documented suicide. In the fall of 2009 Philip Grossman, in despair, checked into a Woburn motel, left his glasses and watch on the desk in his room, and killed himself. (Go to Boston.com, and then search "arbitration Woburn suicide") "They've committed a crime against us, as far as I'm concerned," Grossman's wife, Gail, said in an interview. "Why do we have to go to arbitration? With other crimes you get a trial and a jury."

Does no-one see what has happened? How many Mr. Grossman's are out there? Sadly, thousands more people have made the trip into these sinister bowels of greed:

From Jordan Fogal's testimony (http://judiciary.house.gov/hearings/June2007/061207fogal.pdf) for Congress: "The first night in our new home, my husband decided to try out his new Jacuzzi tub on the third floor. When he pulled the plug, one hundred gallons of water crashed through our dining room ceiling. My husband tried to calm me by saying, connecting the plumbing drains was probably just one slipup the builder had overlooked. We sopped up water that ran down the columns and through the hardwood floors, even into the garage below; water pooled in the chandelier." "Well, this was not one overlooked plumbing connection. ...It was a preview of coming attractions. Rainwater, from outside, sprayed us at the kitchen table. - The windows were installed upside down (our builder finally admitted this after three years). Our floors buckled and black spider-webs of mold crawled up our walls; the smell grew worse; then shower wall fell out and little puffballs grew out of the carpet. All the while, we had begged our builder to please fix our house."

"We had the mold tested by an accredited laboratory, and they said they had never seen toxic readings that high in an inhabited dwelling. Prior to this, we had not mentioned the nosebleeds, headaches, the swollen eyes, and the sinus infections because we had seen how people were treated. Their defects were dismissed because the homebuyers were crazy hypochondriacs. My builder said everyone has mold and it doesn't bother anybody. Yet, he takes allergy shots. People have told me, and I have heard testimony, of children's eardrums bursting, babies vomiting up blood, and even the family cat suddenly dying. Stachybotrys and Chaetomium will make you deathly ill. We took the reports to our family doctor. She told us to move out of the house immediately."

Let me re-iterate: Tens of thousands of people have been mowed over by Binding Mandatory Arbitration clauses.

If you question the figure above, ONE corporation - KB Home, can account for that many: In 1979, the FTC sued Kaufman and Broad; the penalty was minimal. They had to fix some of the homes; and sign a FTC Consent Order. KB Home continued to thumb their noses at the FTC for 26 years, repeatedly violating the 1979 FTC consent order, and mercilessly inserting clauses into its contracts that mandated homeowners use binding arbitration to solve disputes. Finally in 2006, KB Home agreed to modify the existing warranties of tens of thousands of homeowners, including Texas owners who bought a house from KB Home after January 1996 (about 60,000 homeowners in San Antonio, the Rio Grande Valley, Austin, Houston, Dallas, and Fort Worth). With the settlement of the class-action suit, KB Home and its subsidiaries' binding arbitration clauses are invalid. If BMA is so fair, why did KB Home insist on defying the Federal Government and include these clauses in their contracts?

"Congress, the courts and the public have been victims of a disinformation campaign, portraying arbitration as an inexpensive and impartial alternative to the public courts." Testimony Submitted by F. Paul Bland Jr., Staff Attorney Public Justice (Formerly Trial Lawyers for Public Justice) on June 12, 2007, gives us an example.
(http://judiciary.house.gov/hearings/June2007/Bland070612.pdf)

["Corporate supporters of mandatory arbitration routinely point to 'studies' claiming that consumers and employees do well in mandatory arbitration." One of these studies, "literally ignores 1,000 consumer cases handled by NAF for every case it considers, and considers a $1 award to a consumer claiming losses of $100,000 to be a victory."]

Congressman Hank Johnson has attempted to protect consumers for years. He was quoted in 2007, when he previously introduced this Arbitration Fairness Act, as saying "...and despite what companies may say, it is not more affordable than going to court, should not require consumers to travel to an appointed location for arbitration, should not contain hidden costs, should not threaten complainants with a 'loser pays' proposition to discourage them, should not shorten the notification period, or block class action status, as some clauses do."

Over 95% of arbitration cases are settled in favor of big business. Big business is the constant meal ticket for arbitration companies and arbitrators; and contracts typically name the arbitration firm that must be used. If arbitrators rule against them, big businesses simply will not use them again.

Nowhere will you find an accurate tally of people being financially and emotionally quashed by BMA. Figures cannot possibly include the people who have never actually made it through the arbitration proceedings; and therefore, couldn't substantiate any injustices. Quoting Public Citizen, "... arbitration costs are so high that many people drop their complaints because they can't afford to pursue them" {Public Citizen's study revealed fees can be up to five thousand percent higher in arbitration than in court litigation.} Some corporations impose "loser pays rules" to discourage individuals from bringing claims, and some corporations require people to arbitrate their claims across the country, knowing that people will be forced to drop the cases.

Binding Arbitration is labeled by the National Consumer Law Center as "astonishingly unfair and undemocratic" and virtually every major consumer group in America opposes Binding Mandatory Arbitration including the AARP supported, Give Me Back My Rights coalition at http://www.givemebackmyrights.com, and the National Association of Consumer Advocates at http://naca.net.

The Arbitration Fairness Act is supported by a host of consumer advocate organizations including Consumers Union, Public Citizen, American Association for Justice, Center for Responsible Lending, Consumer Federation of America, Homeowners Against Deficient Dwellings (HADD.com), Home Owners for Better Building (HOBB.org), National Consumer Law Center (on behalf of its low income clients), National Consumer Coalition for Nursing Home Reform, the National Employment Lawyers Association and Public Justice.

Even worse, courts uphold this devious practice – On April 27, 2011, the U.S. Supreme Court dealt consumers yet another crushing blow, in a decision that favors large corporations at the expense of working-class families.

In AT&T Mobility vs. Concepcion a California couple, who objected to a $30 charge for a cellphone that was advertised as being free, filed a lawsuit against AT&T Mobility seeking class-action treatment. However, the consumer contract accompanying the phone service included a mandatory arbitration clause barring class proceedings. State and federal courts refused to enforce the arbitration agreement and allowed the case to go forward, citing a 2005 ruling from the California Supreme Court that such class action waivers are unconscionable.

By a 5-4 vote, the Supreme Court overturned the lower courts' rulings; and decreed that companies may use arbitration clauses in consumer contracts to trounce consumers and employees' right to join together through class actions to hold corporations accountable for fraud, discrimination, or other illegal practices.

This decision effectively insulates companies from accountability when they defraud a large number of customers of a relatively small amount of money. Class actions are an indispensable tool for justice in our society to keep large corporations from trampling over their consumers, clients, and employees. Now, consumers' only hope is for our Congressional leaders to negate this horrific decision

Senator Blumenthal has stated, "Today's misguided Supreme Court ruling is a setback for millions of Americans, denying injured consumers access to justice. The Arbitration Fairness Act would reverse this decision and restore the long-held rights of consumers to hold corporations accountable for their misdeeds."

"Forced arbitration agreements undermine our indelible Constitutional right to trial by jury, benefiting powerful businesses at the expense of American consumers and workers," said Rep. Hank Johnson.

And don't forget, "Companies retain the right to unilaterally change the terms of the contract at any time. [They] change the terms all the time," said Julia Duncan, associate director and counsel at the American Association for Justice.

For anyone who questions how serious this issue is, take a look at some of the consequences of Forced Arbitration: http://www.franken.senate.gov/?p=video&id=816. Also, take note. This is a perfect illustration of how they try to twist the facts and numbers.

Halliburton / Kellogg Brown & Root employees have to sign an arbitration clause to get a job. So when 20-year-old Jamie Leigh Jones was drugged and repeatedly raped by numerous Halliburton employees, so violently that she needed breast reconstruction surgery, Halliburton covered up the incident as best they could. They locked Jamie Leigh in a shipping container without food, water, or even medical treatment for 24 hours. They told her to keep quiet and that she'd lose her job if she left the country to get medical help. Finally, a guard allowed her to borrow a cell phone to call her father. Her father, in turn, called the State Department to get her released.

Halliburton / KBR stalled Jones' lawsuit, compelling arbitration for all of Jones's claims, including the torts related to the alleged rape (assault and battery; intentional infliction of emotional distress; negligent hiring, retention, and supervision of the employees involved; and wrongful imprisonment), by citing its pre-employment mandatory arbitration clause in Jones's employment contract and arguing that the alleged rape was a personal injury claim arising in the workplace (in this case, Halliburton wants "workplace" to include Jones's sleeping quarters because they were employer-provided).

Jamie Leigh was also prohibited from suing or seeking criminal justice because her Halliburton contract forbade seeking any justice apart from private arbitration.

By the way, she was housed with 400 men, "men that KBR employment people knew did this kind of thing." Jamie Leigh told KBR twice that she was being sexually harassed. Jamie Leigh later spoke with other rape victims (KBR employees) who were told to keep silent (under arbitration). Because there was no public disclosure, Jamie Leigh had no forewarning of the impending threat.

Senator Franken: "This is a result of your Binding Mandatory Arbitration ... "

What other hideous crimes have been hidden and covered up in arbitration? Use your imagination.

"With mandatory pre-dispute arbitration privatizing our civil justice system - a system we fought a revolution for - fairness in the marketplace is undermined and consumers are denied any remedy for fraud and deception," said Public Citizen President Joan Claybrook.

People who have been harmed by fraud, predatory lending, discrimination, negligence, defective products, or scams should not be forced into arbitration: they should have a choice.

The fact that our legislature is primed to listen, presents American consumers with a phenomenal opportunity. This is vital to protecting the quality of life for untold thousands of individuals. We must fight to defend our rights and re-empower consumers.

I urge you to do whatever you can to get this legislation passed. People (and organizations) need to join forces, to get the word out, and to get the public inflamed enough to bring about change. Unite against this injustice, and share this news with everyone you know. Only through rebuilding victims' lives and deterring future misconduct, can we rebuild our nation's hope for a stronger economy. Otherwise, Binding Arbitration will continue to wreak havoc on our nation's economy, just as it has crushed so many individuals' economic lives.

If anyone can get media attention, please do so. You can find and contact national and local media outlets in your area through Congress.org at: http://www.congress.org/congressorg/dbq/media

NOTE: If you get any media interest, have them contact me at: amy824@cauc2.net.

Please review the testimony submitted to the June 12, 2007 hearing held by the House's Committee on the Judiciary, "Mandatory Binding Arbitration Agreements: Are They Fair for Consumers?" from:

F. Paul Bland Jr. (http://judiciary.house.gov/hearings/June2007/Bland070612.pdf) and
Jordan Fogal (http://judiciary.house.gov/hearings/June2007/061207fogal.pdf).

Lastly, you may visit my webpages, Binding Arbitration (http://cauc2.net/binding_arbitration.htm) and Corrupt Establishment (http://cauc2.net/corrupt_establishment.htm, especially parts 2&3) for an in-depth exposé.

Binding Arbitration and Right-to-Cure, Is Your State Next? That is a very real threat!