Lots going on in Congress on arbitration

by Jeff Sovern

Bloomberg reports that the House will vote this month on the FAIR Act, a bill to bar arbitration clauses in consumer and employment contracts. The House last passed a similar bill in 2019. The Senate Banking Committee will hold a hearing on arbitration Tuesday. The stumbling block to congressional action remains the filibuster in the Senate. Still, Congress recently enacted a law barring the use of arbitration clauses to prevent sexual assault and sexual harassment claims, so there is reason for hope, the thing with feathers.

Watch Tower’s misuse of copyright to suppress criticism

by Paul Alan Levy

This is a sad tale of hypocrisy on the part of a group whose litigation over the past eighty-five years has set many of our most important First Amendment precedents. But over the past four to five years, the Watch Tower Bible and Tract Society, popularly known as the Jehovah’s Witnesses, has been abusing judicial process to suppress commentary, mostly criticism, by obtaining subpoenas under the Digital Millennium Copyright Act to out its critics by invoking claims of questionable merit. These are typical SLAPP suits, but under the copyright laws. In almost all of these cases, the victims could not find counsel to fight back, and had to censor themselves.

First Amendment History

Beginning with Lovell v. City of Griffin, in 1938, the Jehovah’s Witnesses began an admirable string of cases in the Supreme Court that have helped to establish the First Amendment rights that we enjoy today. I had the good fortune of being able to help them win one of the most recent, when I did a moot court for their in-house counsel, Paul Polidoro, when he was arguing Watch Tower Bible and Tract Society v. Village of Stratton in the Supreme Court, arguing for the right of Jehovah’s Witnesses to go door to door spreading their religious messages (and accepting donations) without having to provide their names. This long history of litigating to advance First Amendment protections, coupled with the Witnesses’ status as a minority religious sect that has encountered plenty of community prejudice, had always left me with a soft spot for the group.

The Present Line of Cases

So it was a bit of a shock when I learned that Watch Tower has served some seventy-two DMCA subpoenas since 2017 seeking to identify critics, many of them disgruntled current and former members who have in many cases, so far as I can tell, posted texts and videos authored by Jehovah’s Witnesses for the purpose of explaining their concerns about Watch Tower’s activities. As can be seen from this list of Watch Tower copyright infringement lawsuits, Watch Tower has never used the information obtained from these subpoenas to file an infringement action. The only infringement lawsuit that Watch Tower has filed against the target of one of its DMCA subpoenas is a current case (discussed below) in which enforcement of the subpoena was denied!

2 announcements from Federal Trade Commisison today

FTC Takes Action Against Company Formerly Known as Weight Watchers for Illegally Collecting Kids’ Sensitive Health Data - here,

and

FTC Kicks Off National Consumer Protection Week this Sunday - here.

CFPB report estimates $88 billion in medical bills on credit reports

A new Consumer Financial Protection Bureau report highlights "the complicated and burdensome nature of the medical billing system in the United States."

The report reveals that the U.S. healthcare system is supported by a billing, payments, collections, and credit reporting infrastructure where mistakes are common, and where patients often have difficulty getting these errors corrected or resolved.

The press release summarizing the report is here. The report itself is here.

Webinar: What to Know About College Students, Cryptocurrencies, and Scams

On March 9, as part of National Consumer Protection Week, the Federal Trade Commission and National Student Employment Association are presenting a free webinar called "What to Know About College Students, Cryptocurrencies, and Scams." Here is the description:

You’ve probably heard of cryptocurrency, but do you know how it works? This webinar will go over the basics of cryptocurrency and common scams – and how it’s affecting twenty-somethings. We’ll cover how to avoid the most common scams using cryptocurrencies – investment and business opportunity scams, blackmail scams, and social media scams that ask for cryptocurrency as payment – and where to report these scams.

Information about how to listen in is here.

New Mexico caps interest rates on storefront loans

New Mexico's governor has signed a bill reforming predatory lending practices by lowering the cap on small loan interest rates from 175% to 36%. The governor's press release is here.

Two consumer law announcements involving international matters

Both courtesy of Kathleen Engel:

Consumer protection law in the 21st century: Moving to a new Pangaea or a continental drift?

5th Bi-Annual UPICLC

University of Pretoria International Consumer Protection Law Conference

15-17 September 2022

Call for Papers 
The International Review of Financial Consumers.

The IRFC, established in 2016 by the International Academy of Financial Consumers (IAFICO) to publish studies on financial consumers for a global audience, solicits papers for a Special Issue on Consumer Protection in Insurance Markets. The expansion of insurance into developing markets via microinsurance and mobile apps, the increasing use of Insurtech and AI, concerns about insurance gaps and emerging risks are changing the landscape for insurance consumer protections. The potential scope for protections is broad including contractual language, advertising and sales behaviors, pricing, policy cancellations and renewals, claim payments and denials – and protection mechanisms may include government regulations, education, service provision, legal principles, and corporate ESG practices.

Research considering the effects and effectiveness of consumer protection regulations, responses of consumers or producers to regulations, comparing consumer protection approaches across countries, or addressing consumer protection gaps in insurance markets are all within the scope of this Special Issue. Research questions and implications should be addressed from consumers' point of view.

Manuscript Submissions: Manuscripts should be submitted via email to irfc@cornell.edu by October 30, 2022. All submissions will be subject to the regular peer-review process employed by IRFC.

Some states charge consumers responding to debt collection suits filing fees of hundreds of dollars

So reports George Simons at Bloomberg Law. Excerpt:

California, Arizona, and Minnesota are good examples of states attempting to increase access to justice while charging defendants enormous filing fees. These fees are charged for all types of civil lawsuits, but are particularly relevant to debt lawsuits where defendants are being sued because, presumably, they don’t have any money.

Although some states provide fee waivers, this practice only helps the lowest-income people and leaves people in other income groups with onerous fees. Moreover, for defendants who can pay the fee, they still must struggle to calculate it and to file their documents with the court—a difficult challenge on its own.

Consumer Advocates Propose New Model State Consumer Protection Act

The LA Times and Ralph Nader have already written about it. Here's the press release, which includes links:

Hacked by Big Corporations, America’s Civil Justice System Has Crashed, Consumer Advocates Say

Report Details Impact on Consumers – and Democracy – of Corporate Attack on the Rule of Law, Proposes New Protections and Legal Procedures

Contact: Harvey Rosenfield (213) 527-3757; Laura Antonini (949) 929-2612
Los Angeles, CA – February 17, 2022

America’s civil justice system has been corrupted by corporations and no longer protects average Americans from the countless non-stop thefts of their money, time, and privacy, according to a new report by two nationally recognized consumer advocates.

The 259-page study, published by #REPRESENT, a California-based non-profit, documents how business goliaths and their front groups like the U.S. Chamber of Commerce sponsored a fifty-year campaign to reprogram the nation’s civil laws and judicial procedures to favor corporations and the elites.

Reboot Required: The Civil Justice System Has Crashed details the most common costly and abusive tactics that consumers face in the U.S. marketplace – against which they have virtually no legal rights or remedies.

It chronicles how corporations seized control of the legislative, executive, and judicial branches beginning in the 1970s to erode landmark consumer protection laws and block the passage of badly needed new ones, crippling the class action system and stripping Americans of their cherished right to their “day in court” and trial by jury.

And it sounds an urgent call to action. The advocates present a detailed blueprint for the restoration of the civil justice system, in the form of a model state consumer protection law, The Represent Act.

“The relentless corporate assault on the rule of law has deeply damaged Americans’ confidence in the legal system, a development with dire implications for U.S. democracy,” warn Harvey Rosenfield and Laura Antonini, the authors of the report. “We have lately learned how fragile our institutions are, how quickly anger and despair can turn to violence when the rules do not apply to everyone. We must reclaim control of our civil justice system from the corporations so that it serves the American people and empowers them to meet the challenges of the 21st Century.”

Horton article finds plaintiffs less likely to win in forced remote arbitration

David Horton of California, Davis has written Forced Remote Arbitration, 108 Cornell Law Review (2022). Here's the abstract:

Courts responded to COVID-19 by going remote. In early 2020, as lockdown orders swept through the country, virtual hearings—which once were rare—became common. This shift generated fierce debate about how video trials differ from in-person proceedings. Now, though, most courts have reopened, and the future of remote trials is unclear.

However, the pandemic also prompted a sea change in alternative dispute resolution. Arbitration providers pivoted away from in-person adjudication and heard cases online. Yet unlike virtual trials, which coexist uneasily with norms in the court system, remote hearings fit snugly within arbitration’s tradition of procedural and evidentiary informality. Thus, while virtual trials may prove to be temporary, virtual arbitration is gaining steam. Online-only arbitration startups have emerged, established providers are marketing their virtual options, and firms are mandating that plaintiffs resolve disputes without setting foot in the same room as the decision-maker. This trend threatens to make the controversial topic of forced arbitration even more fraught. Nevertheless, we do not know how remote procedures impact win rates, case length, and arbitration fees.

This Article shines light on these issues by conducting an empirical study of forced remote arbitration. It analyzes 70,150 recent filings and reaches three main conclusions. First, since July 2020, roughly 67% of all evidentiary hearings have been held virtually. Even though this figure will likely decline as the pandemic re-cedes, online arbitration has become entrenched. Second, plaintiffs who participate in virtual proceedings generally win less often and recover lower damage awards than individuals who arbitrate in person. This “remote penalty” exists in some set-tings even after controlling for variables such as claim type, pro se status, and the experience of the defendant, the lawyers, and the arbitrators. Third, even though proponents of forced remote arbitration contend that it streamlines cases, the data only partially support this claim. Some remote modes, such as documents-only proceedings, seem to save time and money, while others, like video hearings, do not. Finally, the Article explains how its findings can help lawmakers and judges regulate and monitor forced remote arbitration.