I’m adding something new to our Blog experience, the ArbitrationNation Bookworm. Basically, once or twice a month, I’ll provide a brief overview of an article or book that readers of the Blog might find interesting. I’m also going to add a sidebar that includes other stuff that we’re reading related to arbitration.
For the inaugural post, I’m recommending an article from early 2019, Arbitration Nation: Data from Four Providers, by Andrea Cann Chandrasekher and David Horton. (Neither Liz nor I had any involvement in writing the article, despite its title, but the authors did secure permission from Liz to use the Arbitration Nation name.)
This article analyzes a huge data set on consumer, employee, and patient arbitration – 40,775 arbitrations filed between 2010 and 2016 and administered for four major institutions. I won’t spoil all the fun of reviewing the findings, but the authors conclude that three points emerge:
First, arbitration has the capacity to facilitate access to justice. Cases move quickly through the system, and corporations pick up most of the tab. Second, arbitration is not currently living up to this potential. Although businesses are correct that more individuals are arbitrating after Concepcion, this uptick has been modest. Moreover, companies are wrong about who is bringing those claims. Plaintiffs’ lawyers—not self- represented consumers, employees, or medical patients—have been taking advantage of arbitration’s speed and relative affordability. In fact, some attorneys have tried to create a simulacrum of the class action by initiating dozens or even hundreds of two-party arbitrations against the same defendant. Third, concern that arbitration favors repeat-playing corporations is well founded. Indeed, businesses that arbitrate often in an institution perform particularly well within that institution. Nevertheless, this is just one-half of the repeat-player story. Arbitration favors repeat players on both sides. In a variety of different settings, serially arbitrating plaintiffs’ law firms also fare particularly well.
For anyone thinking about the many sticky issues around consumer, employment, or patient arbitration clauses, this article warrants a close look.