Arbitration Firms Are Godless Bloodsuckers

n 2006, Richard Neely, a retired chief justice of the West Virginia Supreme Court, penned an article for The West Virginia Lawyer entitled, “Arbitration and the Godless Bloodsuckers.” The National Arbitration Forum asked him to be an arbitrator one time and Neely described his experience:

“[T]he bank asks for substantial costs related to the arbitration itself, and those costs are significantly higher than court filing fees. . . . In one case that I handled, the fees alone amounted to $450. Furthermore, the arbitration company sends the arbitrator a judgment form already filled out so that all the arbitrator need do is check the appropriate box… In my case I did not award the bank the litigation-related fees. . . . I never got another case!”

Full article inside…

National Arbitration Forum… weren’t those the guys Public Citizen found ruled in favor of companies 95% of the time? Yep, they are.

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Mandatory binding arbitration against consumers is a scam. Let’s abolish it and keep it where it was designed for, businesses to deal with other businesses.

Sept 2006 [West Virginia Lawyer via Credit Slips
(Photo: Jackass)

Comments

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  1. protest says:

    when i had surgery on my hand last year, the nurse who was having me fill out all the paperwork gave me an odd form, telling me that if i signed it, and the hospital screwed up, i would agree to “discuss” it in 3 party talks with a retired judge instead of taking it to court. i said hell no and the nurse said she didn’t blame me.

    isn’t that weird? i guess i never thought of a hospital as a “business”, shows what i know.

  2. missdona says:

    I used to work for an Arb firm that did tons of car accidents. The insurance adjusters got a “volume discount” rate of about half of the “standard rate” that most PI attorneys paid.

    Godless Bloodsuckers.

  3. JiminyChristmas says:

    So this means there are 1000s of people who have paid hundreds or thousands of dollars in ‘fees’ based upon illegal or unconscionable contract clauses? Sounds like a class action suit waiting to happen.

    Meanwhile, as the judge states in the article: In the state of West Virginia, binding arbitration clauses in contracts of adhesion are illegal. So, how does that clause get into the cardholder agreements of WV customers? Did the CC companies just not do their due diligence? Do most of us have illegal or unenforcable clauses in the agreements on our cards? So many questions…

  4. JiminyChristmas says:

    And another thing: Where I live, the filing fee for small claims court is $55. So, at $450 in arbitration fees you’re paying about 8x the going rate of what your day in court would cost you.

  5. Man, you’d think Richard Neely wrote for this site with a title like that! :)

    BTW, thank you for the nightmares. The image has been adblocked.

  6. jrdnjstn78 says:

    That picture is ugly! That’s Steve-O getting a medicinal worm stuck to his eye.

  7. WraithSama says:

    It’s been years since I’ve had a business law class, but if I’m not mistaken, doesn’t a clause in a contract that violates established law invalidate the entire contract?

    If so, it would also stand to reason that a clause that gives the purveyor of the contract the ability to strike clauses from a contract to protect it from invalidation due to an illegal clause would also be illegal, as it circumvents law and doesn’t give the other party a chance to agree or opt-out of a change of terms… wouldn’t it?

  8. WraithSama says:

    Also, and I’m aware this is a hotly debated issue, but to my knowledge, you do not have the ability to sign away your rights guaranteed by the Constitution. As such, I would think a binding arbitration clause that forces you to surrender your right to have a dispute taken to trial by peers would not be enforceable to begin with.

  9. Cowboys_fan says:

    What’s wrong with being godless? They should be godless, just like judges.

  10. rbcat says:

    @WraithSama: The term you are looking for is “severable.” An example:

    If any provision of this Agreement is found to be unenforceable by a court or agency of competent jurisdiction, the remaining provisions will remain in full force and effect. – Service Agreement, AT&T Wireless

    @JiminyChristmas: The prohibition on arbitration in contracts of adhesion only apparently exists in relation to medical malpractice insurance contracts.

  11. ChaosMotor says:

    “If any provision of this Agreement is found to be unenforceable by a court or agency of competent jurisdiction, the remaining provisions will remain in full force and effect. – Service Agreement, AT&T Wireless”

    When what we need to do is to get this type of clause to be found unenforceable, and we’re done… or are we?

  12. zolielo says:

    Ben just loves arbitration…

  13. rmz says:

    @Cowboys_fan: Someone should tell Justice Scalia that.

  14. mrearly2 says:

    The whole banking/mortgage industry is based on fraud and deception, so this doesn’t surprise me.

  15. Fitzador says:

    @WraithSama: That was the subject of Buckeye Check Cashing Inc. v. Cartagena (2006). In that case, respondent Cartagena wanted to resolve his contract dispute in court — not in arbitration as the contract required — since the contract was found to be unenforcable. The Supremes, however, ruled that, per the Federal Arbitration Act, an arbitration clause is severable from a contract, so even if the contract is rendered unenforcable, an arbitration clause is never unenforcable.

    So much for contract law.