CL&P Blog

Chandrasekher study finds lack of diversity among arbitrators

Andrea Chandrasekher of California, Davis has written An Empirical Investigation of Diversity in U.S. Arbitration. Here is the abstract:

For decades, the United States system of arbitration has been subject to nearly constant public criticism. Calling arbitration a rigged judicial system, consumer and employee rights groups have voiced opposition to the practice of "forced arbitration" whereby millions of Americans are contractually required to settle disputes in arbitration rather than in litigation. Just when it seemed that things couldn't possibly get any more controversial, arbitration is in the hot seat again, this time over the lack of diversity amongst U.S. arbitrators. In the wake of a national racial reckoning and high profile cases that have called attention to the issue, arbitration has been called the place "where white men rule." Despite this national attention, the number of rigorous empirical studies investigating diversity in arbitration is limited. Because much of the diversity conversation has been based on anecdotal information and survey data which doesn't cover the full population of U.S. arbitrators, basic facts about the demographic profile of U.S. arbitrators are still unknown: What percent of arbitrators are diverse (i.e.—Black, Hispanic, Asian, or female)? Are diverse arbitrators under-selected for arbitration cases compared to their white male counterparts? Most importantly, to what extent do the race and gender of the arbitrator impact the outcome of the arbitration?

This paper contributes to the literature by using an originally-collected data set of arbitrator race, ethnicity and gender from the two largest arbitration firms in the U.S., Judicial Arbitration and Mediation Services (“JAMS”) and the American Arbitration Association (“AAA”). The data were collected using public data sources and cutting-edge machine learning techniques. This is the first-ever empirical effort to estimate the race and ethnicity of arbitrators for both the JAMS and AAA populations. The analysis presents estimates of the demographic profile of the supply of U.S. arbitrators, the demographic profile of the subset of arbitrators that are actually selected to arbitrate, as well as regression analyses examining the relationship between arbitrator diversity and arbitration outcomes.

The study has four main findings. First, women and people of color are underrepresented amongst U.S. arbitrators, both relative to the U.S. population and relative to the population of American lawyers and judges. The extent of the underrepresentation for both groups is significant, though it is more severe for arbitrators of color than for female arbitrators.

Second, the rate at which arbitrators of color and women are selected to arbitrate is generally proportional to their (very low) representation in arbitration organizations.

Third, with respect to arbitration outcomes, there is no statistically significant relationship between an arbitrator's race/ethnicity and how they decide cases. However, the reason for this non-finding is that the study is statistically under-powered. In other words, with less than 4% of arbitrators being Black, Asian, or Hispanic, there are simply not enough arbitrators of color to even conclusively study the relationship between racial / ethnic diversity and arbitration outcomes. This, in and of itself, is a powerful statement about the lack of diversity in US arbitration.

Fourth, as has been found in some previous studies, the evidence suggests that female arbitrators are less likely than their male counterparts to rule in favor of plaintiffs. The likely reason for this is differential case selection; female arbitrators disproportionately decide cases that are harder for plaintiffs to win. This gender effect exists in both JAMS and AAA arbitrations, though the results vary from statistically significant in some models (p<0.05) to weakly statistically significant in others (p<0.10).

The study concludes by offering policy observations for the road forward.

Showdown at the Second Circuit on the Standards Protecting Onine Anonymity

by Paul Alan Levy

An important case about anonymous online speech is hurtling toward a decision in the Second Circuit. The situation is worrisome because defendants are so unsympathetic and the plaintiff’s legal claims seem to me very strong. The danger is that the trial judge’s dismissive treatment of the right to speak anonymously could be addressed in a way that has serious implications for more legitimate speakers.

Everytown for Gun Safety Sues Gun Rights Activists for Trademark Infringement

The case arises from a dispute between advocates of broad access to firearms through the device of 3D printing of guns and the gun-safety policy group Everytown for Gun Safety Action Fund,  as well as its subsidiary Moms Demand Action. The groups strongly oppose the 3D printing of guns, which they see as a serious threat to safety and as an evasion of sensible gun regulation.

For the apparent purpose of expressing their contempt for Everytown and its affiliated group, some pseudonymous Internet users created instructions for the 3D printing of guns that were emblazoned with the Everytown and Moms Demand Action names, and in the precise contours of their respective logos, and uploaded them to a paid subscription site called Defcad. Then, other similar pseudonyms were used to tweet images of the printed guns; the tweets were directed among other places to Everytown.

 

"Wells Fargo found another way to abuse customers. Then I called them on it."

By David Lazarus at the LA Times here.

More baseless and unethical demand letters from Mathew Higbee

by Paul Alan Levy

It’s been some time since I have had occasion to write about Mathew Higbee’s use of baseless threats of litigation seeking to wring undeserved dollars out of alleged copyright infringers. To be sure, many of his demand letters seek remedies for plainly infringing uses, even if his monetary demands tend toward the excessive.

But today’s post is devoted to a pair of demand letters sent to former clients of mine who had to sue clients of the Higbee firm back in 2019 and 2020 for declarations of non-infringement after he had threatened to sue them over websites that were hosting discussion forums to which users had posted photographs, or links to photographs. Both in threatening Jessamyn West over her MLSTHP site, and in threatening to sue the Mockingbird Foundation over its website for Phish fans, Phish.net, the Higbee firm sought to take advantage over those hosts’ failure to perfect the registration of DMCA agents for receipt of takedown demands. But the threats foundered anyway, on the standard requirement that copyright owners show that the infringement was volitional.

Both Higbee clients had to agree to drop their demands, and one of the clients had to pay $10,000 in attorney fees. In light of these cases, as well as the retraction of a Higbee firm demand letter to Erik Anderson in response to a declaratory judgment action on behalf of photographers Mark Seliger and Steven Hirsch, Mathew Higbee assured me that his firm had stopped issuing demand letters to forum hosts over photographs posted by their users.

But the Higbee firm has returned to its old tricks (and why so greedy?  from the frequent queries I receive, its legitimate business has scarcely dried up). In the past month, I have heard both from counsel for Jessamyn West and from counsel for Mockingbird Foundation about demand letters that their clients received, demanding $7000 in damages for copyright infringement based on a Timothy White photograph  demanding $7000 in damages based on alleged infringement of a Timothy White photograph posted by a user to MLTSHP, and demanding demanding $25000 in damages based on the fact that there is a deeplink to a Jeffrey Werner photograph posted to a user comment on Phish.net. But these threats are double frivolous, because not only does the Higbee firm know that infringement liability would barred by the volition doctrine, but both sites fixed their DMCA agent registrations before the previous litigation began, and hence neither could be sued for damages anyway because the DMCA makes them immune so long as they respond promptly to properly submitted DMCA takedown notices (and lest one think the Higbee firm is unaware of the DMCA agents — Mockingbird ALSO received a Higbee firm  DMCA takedown letter for that same photograph).

Article on Article III standing, Spokeo, and TransUnion

Law prof Elizabeth Earle Beske has written Charting a Course Past Spokeo and TransUnion. Here's the abstract:

The Supreme Court’s 5-4 decision in TransUnion LLC v. Ramirez has dramatically upended standing doctrine, apparently out of concern that any other move will invite congressional manipulation and give rise to even greater evils. The Court has done so at considerable cost. TransUnion’s concreteness inquiry leaves lower courts at sea, inviting them to substitute their own policy preferences for legislative will in frustration of the separation of powers. It curtails the deferential review of economic legislation the Court has employed since the New Deal. It circumscribes Congress’s ability to act proactively to respond to novel challenges. Bearing these costs, we are told, is necessary.

But the concreteness inquiry should not have had a role to play in the adjudication of private rights by private parties at all. Since Spokeo v. Robins, Justice Thomas has persuasively demonstrated that the injury-in-fact inquiry applies as a filtering mechanism only where Congress has conferred public—not private—rights. Before TransUnion, Justice Thomas’s approach was gaining ground. In Uzuegbunam v. Preczewski, handed down three months earlier, eight members of the Court found actionable injury in the violation of a private right although plaintiff could show no harm and had sought only nominal damages. After TransUnion, this simple principle—the violation of a private right gives rise to presumed injury—no longer applies to private rights created by Congress. The TransUnion Court rejected the public-private right dichotomy in this context out of fear of congressional manipulation. The Court suggested that anything but a one-size-fits-all approach requiring federal judges to independently assess and find actual harm would permit Congress to confer “private” rights to public goods, thereby clogging the courts with generalized grievances and trammeling on the enforcement prerogatives of the Executive Branch. The Court apparently believed itself incapable of policing the distinction.

The Court’s lack of confidence in its own ability to avert congressional manipulation is misplaced. This Article demonstrates that for two decades an adjacent line of cases—Alexander v. Sandoval and Gonzaga v. Doe—has required lower federal courts to use text-based analysis to discern whether a statute has conferred an individual right. This approach, which focuses on rights-creating language and examines whether a statute has an aggregate or individual focus, supplies the limiting principle that will prevent the parade of separation-of-powers horribles the TransUnion majority fears.

Jack Gillis retiring after 38 years at Consumer Federation of America

Consumer Federation of America has announced that long-time consumer advocate Jack Gillis is retiring in January. Here is the press release:

After 38 years with the Consumer Federation of America, long-time consumer and auto safety advocate, Jack Gillis, will be retiring as CFA’s Executive Director in January 2022.  Gillis has been with CFA since 1983, serving as Director of Public Affairs and, since 2018, as Executive Director.  “Jack Gillis has been instrumental in successfully maintaining CFA’s leadership on a wide variety of consumer protection, financial services, housing, privacy, food, and safety issues,” said the President of CFA’s Board, Marceline White of the Maryland Consumer Rights Coalition.

CFA President White has announced the formation of a Transition Committee made up of representatives of CFA’s Board, Executive Committee and staff.  “We are pleased that Jack will remain as CEO during the search for a replacement,” said White.

“During his long tenure at CFA Jack has not only been CFA’s main conduit between the organization and the media, but over the years he has led CFA’s efforts in child and product safety, indoor air quality, consumer education, auto sales practices and, most significantly, auto safety.  As a well-known consumer advocate, Gillis is author, co-author and editor of 75 consumer books including The Car Book, published for 40 consecutive years.  He served for ten years as a contributing consumer correspondent for NBC’s Today Show representing CFA, was Good Housekeeping’s personal finance columnist, and was a child product safety columnist at Child Magazine,” said White.

“Gillis’ advocacy has been responsible for major changes in the automobile industry, including significantly improved vehicle safety, better warranties, and increased fuel efficiency.  Early in his career, The New York Times featured Gillis as a leader in a new breed of consumer advocates.  He was an adjunct professor at The George Washington University, where he taught in the Graduate School of Government and Business Administration, and he currently serves on the boards of the Center for Auto Safety (chair), Advocates for Highway and Auto Safety, Center for the Study of Services (Consumers’ Checkbook) and CAPA.  Previously, he was Executive Director of the Certified Automotive Parts Association, a non-profit standard setting organization.  He received his MBA from The George Washington University where he served as a Teaching Fellow and his BA from the University of Notre Dame,” added White.

“Serving the Consumer Federation of America for all of these years has truly been an honor.  It has enabled me to work closely with some of America’s greatest consumer and safety advocates, men and women who have truly changed America for the better.  Any success that I’ve had at CFA rests squarely on the shoulders of these remarkable activists.  As it enters its 54^th year, CFA has a very exciting future ahead and I will always cherish being a small part of its distinguished history,” said Jack Gillis.

CFPB request for comment on Request for Big-Tech payment platforms

On October 21, the Consumer Financial Protection Bureau ordered six large technology companies that operate payments systems in the United States -- Google, Apple, Facebook, Amazon, Square, and PayPal -- to provide information about certain of their business practices. The agency seeks the information to help it better understand how these companies use personal payments data and manage data access to users so the Bureau can ensure adequate consumer protection. 

The CFPB has now published a request for comments, due December 6, to submit comments to inform the agency's inquiry, which is generally about three areas:

• data harvesting and monetization,
• access restrictions and user choice,
• consumer protections, including protections from fraud and errors.

CFPB, DOJ, and OCC take action against Trustmark National Bank for discrimination

The Consumer Financial Protection Bureau and Department of Justice, in cooperation with the Office of the Comptroller of the Currency, have entered into a settlement to resolve allegations of redlining by Trustmark National Bank. The CFPB and DOJ allege that Trustmark discriminated against Black and Hispanic neighborhoods by deliberately not marketing, offering, or originating home loans to consumers in majority-Black and Hispanic neighborhoods in the Memphis metropolitan area. They also allege that Trustmark discouraged consumers residing in or seeking credit for properties located in these neighborhoods from applying for credit.

Under the settlement, which is pending court approval, Trustmark would put $3.85 million into a loan subsidy program for impacted neighborhoods, increase its lending presence there, and implement proper fair lending procedures. The order would also impose a $5 million civil money penalty against the bank, and will credit the $4 million penalty collected by the OCC toward the satisfaction of this amount.

The CFPB's detailed press release, with links to the complaint and proposed order, is here.

FTC report finds many internet service providers collect troves of personal data

A recent report by the Federal Trade Commission staff shows that many internet service providers (ISPs) collect far more data about their customers than many consumers may expect — including access to their Internet traffic and real-time location data — while failing to offer consumers meaningful choices about how they may use the data.

Focusing on the practices of 6 companies, the report identifies several troubling data collection practices among several of the ISPs, including that they combine data across product lines; combine personal, app usage, and web browsing data to target ads; place consumers into sensitive categories such as by race and sexual orientation; and share real-time location data with third-parties.

The report also finds that the privacy protections many of the companies offer raised concerns. Even though some ISPs promise not to sell consumers personal data, they allow it to be used, transferred, and monetized by others and hide disclosures about such practices in fine print of their privacy policies.

Many of the ISPs also claim to offer consumers choices about how their data is used and allow them to access such data. The FTC found, however, that many of these companies often make it difficult for consumers to exercise such choices and sometimes even nudge them to share even more information.

The FTC's staff report is here.

Victoria Barnes on Anne Fleming's Scholarship

Victoria Barnes of the Max Planck Institute for Legal History and Legal Theory has written Anne Fleming’s History of Law and Consumer Finance, 22  Enterprise & Society 316 (2021). Here's the abstract:

This article has teased out Anne Flemings’s interests and the overarching themes in her research. It shows how these themes and interests influenced the direction of her research in the hope that these ideas will continue to be influential in the years to come. Her scholarship tells a compelling story of individual lives, consumerism, and the pitfalls of leaving capitalism unbowed. The significance of Anne’s scholarship is not only owing to her substantive claims but also to her approach. She mapped out elaborate histories of lending, although she primarily assessed consumer finance law and economic policy by looking at their impact on the end user. There is much to be gained by taking such an approach and from using the consumer as a lens to examine banking and financial regulation.