In 2010, when it passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, Congress created the Consumer Financial Protection Bureau as a watchdog for consumers who buy financial products and services. The CFPB’s mission included looking at the effect of arbitration clauses in consumer contracts and proposing rules to regulate them if appropriate.
Qui Tam-Like Claim Eludes Arbitration Act Oblivion — For Now
Concepcion in question
Last week, the Ninth Circuit found a way around the U.S. Supreme Court’s ruling in AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011). The panel held, 2-1, that a qui tam-like claim differs enough from a state-law class action claim to take it beyond Concepcion‘s preemptive reach.
The ruling means, in the Ninth Circuit, that Concepcion will not allow defendants to use arbitration clauses to defeat claims that private plaintiffs bring on behalf of the state and that defendants may therefore face individual cases, in court or arbitration, that put far more than the individuals’ claims at stake.
Continue Reading Qui Tam-Like Claim Eludes Arbitration Act Oblivion — For Now
The Dustbin of Dispute Resolution
Better results
Lawyers who like to handle disputes on a basis that shares risk with their clients often prefer the speed and lower cost of arbitration. The process has its drawbacks; some people worry about fuzzy standards and the lack of review for legal errors. And some general counsel even swear that it costs just as much and takes every bit as long as a lawsuit.
To which I say: hire somebody who will work on a contingent-fee or hybrid basis. You’ll get better, more efficient results faster.
But sometimes courts render rulings that seem to put arbitration into a second-class legal stratum, a minor league of law, a dustbin of dispute resolution. The Eighth Circuit did such a thing just this week.Continue Reading The Dustbin of Dispute Resolution
Stay or Go?
The class-action variety of plaintiffs’ lawyer abhors the federal Arbitration Act.
You can see why. The Supreme Court has turned the FAA into a class action killer. See AT&T Mobility LLC v. Concepcion, 563 U.S. 321 (2011) (holding that FAA pre-empts state law against bans on class treatment of claims), and Am. Express Co. Italian Colors Restaurant, 133 S. Ct. 2304 (2013) (holding that FAA requires enforcement of class action ban even if it thwarts claimants’ ability to vindicate their rights).
But a new FAA ruling by the Second Circuit may afford some comfort to other plaintiffs’ lawyers. Not a lot. Some.
Continue Reading Stay or Go?