Document Type
Article
Publication Date
Winter 2012
ISSN
0040-3288
Publisher
University of Tennessee College of Law
Language
en-US
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 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 judicial oversight-suffices to ensure the fairness of consumer arbitration proceedings. Rather, we suggest both ways that courts and policy makers could reinforce the AAA 's enforcement of the Consumer Due Process Protocol and ways the AAA could improve its own review process.
Recommended Citation
Christopher R. Drahozal & Samantha Zyontz,
Private Regulation of Consumer Arbitration
,
in
79
Tennessee Law Review
289
(2012).
Available at:
https://scholarship.law.bu.edu/faculty_scholarship/3144
