Toyota-Civil Lawsuits-Binding Arbitration-Seventh Amendment Right-Fourteenth Amendment incorporation

[jody]

ON EDIT ADD BUSH SIGNING CITED BILL

Given the certainty of numerous claims against Toyota for civil damages caused by defects in its automobiles, we should consider in what states consumers can have their claims heard by a jury and possible appeal to higher courts OR consumers are forced to rely upon an arbitration panel with no appeal.

Like other issues in a corporate state, corporations have used their underlings in congress and state legislatures to pass laws favorable to corporations. Among those laws is binding arbitration that takes away a citizen’s Seventh Amendment right to jury trial in civil cases. SCOTUS has not incorporated the Seventh Amendment under the Fourteenth Amendment against the states.

The following few excerpts from an excellent presentation by Jere Beasley give background on the case and there are numerous other sources if one searches for {"binding arbitration" "seventh amendment"}

The Evils of Binding Arbitration In Consumer Contracts

II. The Loss Of Trial By Jury The civil jury system in our country is under constant siege. A carefully planned and orchestrated attack by The American Tort Reform Association has been carried out with great skill and precision. Over the past 10 years, the term tort reform became a political buzzword that most Americans really didn’t understand but bought into due to the constant bombardment with propaganda. By constantly hammering home their themes of “frivolous lawsuits,” “greedy trial lawyers,” “runaway juries,” and “jackpot justice,” the masterminds of the attack chipped away at the very institution of the civil jury in America.

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III. Is Arbitration Being Misused? In 1925, Congress passed the Federal Arbitration Act (FAA). This Act was never intended to settle disputes between a consumer and a large business. Prior to the last quarter of the 20th century, courts in this country had been overtly hostile to arbitration. At common law, arbitration was utilized strictly on a voluntary basis.

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Clearly, Congress never intended to give corporate America an unfair advantage over consumers.

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After its passage, the FAA had no effect on consumer contracts for over 60 years. In 1985, the U. S. Supreme Court declared that the FAA established “emphatic federal policy in favor of arbitral dispute resolution.” In Mitsubishi Motors Corporation v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (1985), the court took the presumption in favor of enforcing arbitration beyond the commercial context.

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In the widely acclaimed decision of Allied-Bruce Terminix Companies v. Dobson, 513 U.S. 265 (1995), the U. S. Supreme Court took to even greater heights the application of arbitration. This decision expanded the effect of the Commerce Clause into every imaginable fact situation dealing with consumers and citizens generally. Corporate America seized the opportunity, and has now set out to destroy the jury system once and for all.

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First, this group told Congress that arbitration favored carmakers over car dealers because of the vast power of the carmakers and should not be allowed in their contracts. That makes good, common sense and should carry over to disputes involving consumers and small business owners. However, back in our state the Alabama Automobile Dealers Association forces arbitration on the purchasers of motor vehicles. The hypocrisy of the positions of the car dealers is most clear. However, their bill has passed the House and awaits approval in the Senate. Because of the lobbying strength of NADA, we expect their bill to pass out of the Senate. If George W. Bush becomes President, expect the bill to become law. {President George W. Bush signed the bill on November 2, 2002}.

IV. What Is Wrong With Binding Arbitration? Binding arbitration is simply not suited for a fact situation that involves a consumer on one side and a corporate defendant on the other. In binding arbitration, there are no rules of evidence and no established rules of procedure that would tend to make the playing field level. Such basic things as pre-trial discovery are put on the shelf. Under some binding arbitration agreements, there is not even a guarantee of a hearing before the arbitrator. Seldom, if ever, will you deal with an arbitrator who is truly independent and impartial. On top of this, arbitration is extremely expensive. Basically, binding arbitration is unfair to consumers because in the event of a dispute: (1) the consumer must pay an up front filing fee that could be thousands of dollars; (2) the consumer must pay an hourly fee to the arbitrator; (3) the business has more say than the consumer in who the arbitrator is; (4) the business usually gets to choose where the arbitration takes place and it could be in a far away state where the business has its headquarters; (5) the arbitrator makes the final decision, and is not required to follow the law; (6) there is no right to appeal the ruling of the arbitrator.

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VI. Conclusion Finally, consumers and small business owners are in a battle that must be won. If binding arbitration replaces the civil jury system in spite of the guarantees of the Federal and State Constitutions, our country will suffer.

[drm604]

1. K&R

This is a very important issue.