Originally from Pro-Arbitration Revisited: A Tribute to Professor George Bermann from his Students Over the Years

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This essay covers the background, leading cases and new legislation dealing with the phenomenon of mass arbitrations. It discusses whether this novel strategy employed by resourceful plaintiff’s bar serves arbitration’s purposes or, in fact, disserves the spirit and purpose of arbitration. 

I. BACKGROUND 

In recent years, many companies have sought to limit their exposure to class action lawsuits through a combination of mandatory arbitration clauses and class-action waivers in their terms of service, terms of use, and other form contracts. The overwhelming market trend is for companies to use arbitration as a means to avoid class actions and limit the publicity of disputes. For consumers, employees, and gig-economy workers who accepted the agreement to arbitrate, this meant they were bound to arbitrate on an individual basis in a single proceeding.  In practical terms, the monetary value of the claim and even a potential victory in an arbitration was often outweighed by the legal costs and associated time and effort of pursuing an individual arbitration.