The pro-consumer change comes the same day that a partial settlement was reached in a case accusing Chase and other credit card companies companies of unlawfully conspiring to insert industry-wide arbitration clauses into their contracts. Chase said they won't be replacing the clause with any other similar language, like a class-action waiver.
Mandatory binding arbitration is a clause inserted into many consumer contracts that forces consumers to revoke their right to lawsuit in the event of a dispute. Instead the case gets sent to an arbitration firm, which the company itself pays. The Christian Science Monitor found that the top 10 most used arbitration firms only found in favor of consumer 1.6% of the time. It's about time these kangaroo courts got shut down.
JPMorgan Pulls Arbitration Clause From Card Contracts [Bloomberg]
Case Accusing Chase, Others of Conspiring on Arbitration Clauses is Partially Settled [PR Newswire]
(Photo: Pascal Vuylsteker)
The arbitration section was removed.
]]>Separately I think this stinky evil clauses as an end run around civil rights and the justice system just can't hold water legally.
]]>@econobiker: More customers use them?
]]>Small claims court is very friendly to consumers and isn't really interested in high-priced lawyers.
If you have a case with some merit and sue in small claims, you will win no matter how much money the other side dumps into the case. And, depending on where you are, there are limits on what the maximum award is for lawyer's fees, should you win/lose. I know where I am it is $300.
]]>@Coelacanth: Not sure that applies to kangaroos. They're less likely to unionize.
]]>@pecan 3.14159265: You're breaking the first and second rule.
]]>I'll tell you EXACTLY why they are doing this and, of course, it's to JPMorgan Chase's advantage:
Binding Arbitration goes both ways. If you default on your credit card agreement, then they have to go to arbitration. If they win, then they have to file in state court to get a judgement. Now, they can bypass arbitration, and just sue you directly.
And you thought JPMorgan was just trying to be nice? HA!
Phew. Close one.
]]>@pecan 3.14159265: NOooo!! WON'T SOMEONE THINK OF THE KANGAROOS?!!
]]>@subtlefrog: Of course something is going on. JP Morgan Chase is obviously making money off its underground kangaroo fight club, so they're feeling less pressure to gouge customers.
]]>Yay for the fighting kangaroo picture!!
Also.. It seems like Chase is trying to look like a "good guy" in the eyes of the public... We shall see if this is ever the reality.
]]>Based on the article, sounds like maybe mandatory arbitrations are getting a lot of bad publicity and JP doesn't want to be associated with it anyway.
]]>What is the catch? Sounds good for consumers but how does JP Morgan weasle this around to benefit itself?
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