Archive for the ‘consumer protection’ Category

Lawyer Members of Judiciary Committee Kill Consumer Protection Bill

February 15, 2008

Tulsa, OK – The Oklahoma Senate Judiciary Committee killed a bill that would have given consumers more options when they have disputes with large corporations, including a trial by jury. The bill,SB1852, as filed by Senator Lerblance, was voted on in committee yesterday and received a tie vote, due to the power sharing agreement the bill is now dead for the remainder of the session. Those senators voting against the bill include Senators Williamson, Crane, Sykes, and Lamb. Those voting in favor ofthe legislation include its author, Senator Lerblance, joined by Senators Adelson, Bass, and EasonMcIntyre.

“What I don’t understand is how these four members of the judiciary, who are all lawyers could in good conscious vote against this bill. I find it hard to believe that if they had a client who came to them and asked whether to sign a contract that would require they pay huge out of pocket fees and travel to another state to have their complaint heard, that they would advise them to sign it” says Hugh M. Robert, Executive Director of the OK Center for Consumer & Patient Safety. “This actually assumes that a consumer would catch the clause in the tiny print and actually ask someone about it—the problem with these clauses in the contracts is that they are often one sided, slipped in the contract without the consumerknowing about it, or even sometimes added after the fact” Robert said.

SB 1852 would have limited the use of arbitration agreements in consumer contracts for services like car sales, cable television services, farm and ranch equipment.

“Too many businesses are taking away consumer’s right to jury trial by imposing on consumers take-it-or-leave-it contracts by mandating binding arbitration in the fine print of the contract, often without the signer’s full or even partial understanding of the consequences” Robert said. This bill would have banned binding mandatory arbitration clauses that are forced on consumers. “This would not apply to commercially negotiated arbitration clauses, rather, this would primarily apply to consumer contracts AFTER the consumer has already entered into the contract and often have little say in whether or not to accept the terms,” said Robert.

Other problems with these agreements are that they are often one-sided, requiring only the weaker party (the consumer) to arbitrate his or her claims, while allowing the dominant party (the corporation) to sue in court on its claims. “Binding mandatory arbitration is poisoned by the fact that arbitrators and their firms have a direct financial take in business-friendly outcomes,” Robert goes onto say.

One of the most egregious things to consumers is that some arbitration agreements require the consumerto go to another state to seek justice. For example, the internet auction site e-Bay requires its customers totravel to its home turf of San Jose, California to arbitrate any dispute. Binding Mandatory Arbitration favors the corporate interest over the consumer in that it is designed to produce up-front fees that are so high that they dissuade consumers from enforcing their rights under the law.

For more information, read The Oklahoma Center for Consumer and Patient Safetey: The TRUTH About Binding Mandatory Arbitration Clauses