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    Private Regulation of Consumer Arbitration

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    Full-text available at SSRN. See link in this record. (19.00Kb)
    Issue Date
    2012
    Author
    Drahozal, Christopher R.
    Zyontz, Samantha
    Publisher
    Tennessee Law Review Association, Inc.
    Type
    Article
    Version
    http://ssrn.com/abstract=1904545
    Metadata
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    Abstract
    Arbitration providers, such as the American Arbitration Association (“AAA”) and JAMS, have promulgated due process protocols to regulate the fairness of consumer and employment arbitration agreements. A common criticism of these due process protocols, however, has been that they lack an enforcement mechanism. While arbitration providers state that they enforce the protocols by refusing to administer cases in which the arbitration agreement materially fails to comply with the relevant protocol, the private nature of arbitral dispute resolution makes it difficult to verify whether providers in fact refuse to administer such cases. This article reports the results of the first empirical study of the AAA’s enforcement of its Consumer Due Process Protocol. We find that the AAA’s review of arbitration clauses for protocol compliance appears to be effective at identifying and responding to those clauses with protocol violations. During the time period studied, the AAA refused to administer a substantial number of cases (almost 10% of its total consumer caseload) that involved a protocol violation. Moreover, in response to AAA protocol compliance review, over 150 businesses have either waived problematic provisions or revised arbitration clauses to remove provisions that violated the Consumer Due Process Protocol. Our findings support the proposition that private regulation by the AAA complements existing public regulation of the fairness of consumer arbitration clauses. Any consideration of the need for future legislative action should take into account the effectiveness of this private regulation. That said, we do not assert that private regulation alone - with no public regulatory backstop, such as through court oversight - suffices to ensure the fairness of consumer arbitration proceedings. Rather, we suggest ways that courts and policy makers could reinforce the AAA’s enforcement of the Consumer Due Process Protocol as well as ways the AAA could improve its own review process.
    Description
    Full-text available at SSRN. See link in this record.
    URI
    http://hdl.handle.net/1808/11261
    Collections
    • Distinguished Professors Scholarly Works [918]
    • Law School Scholarly Works [621]
    Citation
    Christopher R. Drahozal & Samantha Zyontz, Private Regulation of Consumer Arbitration, 79 TENN. L. REV. 289 (2012).

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    Contact KU ScholarWorks
    785-864-8983
    KU Libraries
    1425 Jayhawk Blvd
    Lawrence, KS 66045
    785-864-8983

    KU Libraries
    1425 Jayhawk Blvd
    Lawrence, KS 66045
    Image Credits
     

     

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