Originially from: World Arbitration and Mediation Review (WAMR)

An Informational Note on Aggregation Devices in Arbitration
by Debra S. Neveu, Esq.
[Attorney-At-Law, Arbitrator, Mediator,
1223 Prentiss Avenue, New Orleans, LA
70122-1339, tel: (504) 283-2176]
(i)
Although arbitration has been a traditional method of resolving
disputes between commercial entities in the United States, entities that
deal with vast numbers of the public, such as retailers and financial
institutions, have begun to include provisions in standardized contracts
that require the resolution of disputes through arbitration rather than in the
courts. The reasons for expanding the use of arbitration include:
increased efficiency, privacy, and control over the dispute resolution
process, and the ability to select the decision-maker, rather than submit to
the uncertainties, delay, and expense of a jury trial. The U.S. Supreme
Court’s steadfast enforcement of arbitration clauses has reinforced and,
arguably, increased the momentum to include mandatory arbitration
clauses in standardized contracts between commercial entities and their
customers, franchisees, and employees.
Because of the widespread use of these standardized agreements, a
dispute arising under one of these agreements could well be replicated
several times, with similar disputes involving the same contractual
language arising between different parties located in many jurisdictions.
Increasingly, parties to these standardized agreements must consider the
advantages and disadvantages of the aggregation of claims. Aggregation
of claims through intervention, impleader, interpleader, joinder,
consolidation, and class action procedures are the traditional tools used by
the judiciary to promote efficiencies and fairness in the litigation of claims
involving similar facts or occurrences or where several claims are pursued
against the same parties. The Federal Rules of Civil Procedure (FRCP)
give the federal courts broad powers to exercise discretion in determining
when fairness and efficiency concerns indicate that claims should be
aggregated for purposes of litigation. While the Federal Arbitration Act
(FAA) empowers the judiciary to compel arbitration in accordance with a
valid arbitration agreement, neither the FAA nor the FRCP expressly gives
the courts the authority to order aggregation of claims in arbitration—–
unless the parties so provide.