Arbitration | The Ins and Outs of Legal Gymnastics

Oct 19, 2017 / Author Chris Vernon
Arbitration

Although no one likes reading the fine print of a contract, businesses and consumer groups need to key in on arbitration clauses in contracts of any significance that they are asked to sign – because billions of dollars are at stake.

At Vernon Litigation Group, we have an extensive history of representing clients in financial disputes in virtually all major arbitration forums, including FINRA, AAA, and JAMS. As a result, we see firsthand how arbitration agreements (and the legal gymnastics some courts will use to enforce these agreements) can dictate not only the parties’ ability or inability to have their dispute heard by a judge or jury, but also impact both the pursuit of claims and the outcome of claims.

Courts Bombarded with Cases on Arbitration Agreements

Courts, including the U.S. Supreme Court, as well as state courts, are being bombarded with fights over the enforceability of arbitration agreements in contracts. As a result, the courts are still evolving their understanding of the enforceable versus unenforceable provisions and features of arbitration agreements in contracts. We are concerned, however, that the courts are spending too much time parsing the wording of arbitration clauses while effectively ignoring whether or not the resulting arbitration will provide a fair and more cost-effective alternative to bringing claims in court, which is the very purpose of arbitration.

We have said for decades that the arbitration process itself is not inherently bad or good. Rather, fair and cost-effective arbitration is good for businesses, consumers, and the economy. In contrast, abusively structured arbitration or excessively expensive arbitration hurts consumers and consumer backlash may ultimately hurt businesses (which some businesses do not have the foresight to realize).

Use Arbitration Clauses as a Litmus Test

Until the courts begin to take a harder look at the pitfalls of widespread arbitration use and abuse, we believe that the rising, socially conscious generation should look at the arbitration clauses in contracts as one litmus test for whether they should do business with a company. We also think small businesses and wealthy individuals should negotiate out arbitration clauses in large contracts they are signing.

Until the courts become more vigilant in striking down abusive or cost prohibitive arbitration agreements, it is up to the small businesses and individuals to avoid these types of arbitration provisions in contracts because big business will push the limits as far as the courts allow to gut the statutory and common law rights of small business and consumers.

Our Experts are Here to Help

At Vernon Litigation Group, we understand the challenges facing businesses and individuals in dealing with large and well-funded corporations. If you have a dispute involving a contract with an arbitration clause, contact a law firm such as Vernon Litigation Group with significant experience in interpreting and litigating arbitration clauses.

Vernon Litigation Group is based in Naples, Florida with additional offices in Georgia. Vernon Litigation Group represents businesses and individuals throughout the United States who have financial disputes, including securities, insurance, construction, real estate, contract, negligence, breach of fiduciary duty, and fraud disputes in both court and arbitration.

For more information, contact:

Vernon Litigation Group

Phone: 1-877-649-5394

Mr. Vernon handles the litigation and arbitration of complex business and financial disputes, with an emphasis on securities fraud and securities arbitration, throughout the United States.