mandatory arbitration

Ethics Alarms Encore: “The Unethical Fine Print Game”

/ Jack Marshall / 3 Comments

The following  post from 2017 became relevant today when I prepared to comment on  a story last week on Politico: 

Passengers and their survivors won a $265 million court settlement with Amtrak after a 2015 derailment in Philadelphia killed eight people and injured hundreds more. But if such a crash happened today, the victims would not be able to sue. That’s because of a clause the passenger rail line quietly added to its ticket purchases in January, which forces disputes into arbitration with no right to go before a judge or jury.

The change is bringing objections from consumer advocates, who note that it covers scenarios ranging from ordinary ticketing complaints up to wrongful death, and even includes minors who had the tickets purchased for them. And it could soon get Congress’ attention. The language has flown under the radar so far, but may burst into view when the House Transportation Committee holds a hearing on Amtrak next week.

“It is one of the most anti-consumer and passenger clauses I’ve ever seen,” said Julia Duncan, senior director for government affairs at the American Association for Justice, which represents trial lawyers.

I realized that the post I was preparing to write was already written. Here it is, with a addition. [Some other posts on the topic of fine print—yes, it’s a perpetual source of annoyance for me— can be found here.] Continue reading →

Oooooh, Sneaky, Uber!

/ Jack Marshall / 11 Comments

fine-print

Fine print alert!

Uber, the controversial  ride-sharing giant, quietly changed its terms of service to foist mandatory arbitration on its users. This is a common tactic of large corporations lately, taking away consumers’ rights to sue when they are harmed due to negligence. Arbitration is often full of hidden biases, with a natural  financial motivation for less-than-ethical arbitrators to tilt in the direction of the companies that pay them.

The change means that a passenger injured in an Uber vehicle due to its driver’s negligence would be required to arbitrate any claims for personal injuries before the American Arbitration Association, because the passenger had technically agreed to the terms and conditions of the Uber contract every passenger must accept. How would  long-time customers know about the change from the original Uber conditions? They wouldn’t, unless they regularly cruised the company’s website.

On July 29, 2016, Judge Rakoff from the Southern District of New York ruled that the notice of Uber arbitration terms was not sufficient to let riders know that  they were waiving the right to sue, and thus the mandatory arbitration provision was unenforceable. Uber’s response was to send an email to its users, announcing that it was updating its terms effective November 21, 2016.  Uber also instructed its users to read the new Terms and stated it had “revised our arbitration agreement.”  Now they have you, because Uber users can no longer claim that they didn’t know about the new terms. When you use the service, you are stuck. You have waived the right to sue.

There is a large “but,” however.

An Uber user can still reject the November 21, 2016 Terms by providing Uber with written notice by mail, by hand delivery or by email within 30 days of November 21, 2016. Like many companies, Uber’s “notice” consists of a hard-to-find section on its website. The mechanics of rejecting the new terms information are virtually buried on Uber’s legal page, and read, Continue reading →