June 2007 NHTSA Recalls

The June 2007 safety recall report compiled by the National Highway Traffic Safety Administration is available here.  Sorry about the delay, but the agency just posted it, almost two weeks after the month ended.  It seems that while the Consumer Product Safety Commission posts its monthly recall reports right after the month ends, NHTSA is delayed for some reason.

Comprehensive Arbitration Fairness Act to be Introduced in Congress Tomorrow

Tomorrow, Senator Russ Feingold (D-WI) and Representative Hank Johnson (D-GA) will introduce the Arbitration Fairness Act of 2007, comprehensive legislation to ban mandatory binding arbitration clauses in employment, consumer, franchise and civil rights disputes.  There'll be a press conference at the Capitol tomorrow at noon.  In addition to Sen. Feingold and Rep. Johnson, the speakers will be Joan Claybrook, the President of Public Citizen; Jordan Fogal, a consumer who was denied access to the courts because of a mandatory arbitration agreement in her contract to buy her home; other people harmed by mandatory arbitration agreements; and representatives from the American Association for Justice, Center for Responsible Lending, Consumer Federation of America, Homeowners Against Deficient Dwellings, Home Owners for Better Building, National Association of Consumer Advocates, National Consumer Law Center (on behalf of its low income clients), National Consumer Coalition for Nursing Home Reform, National Employment Lawyers Association and Public Justice.

NPR on Arbitration

From NPR's Marketplace, July 9, 2007:

The SEC is expected to sign off soon on a merger of the NASD and the NYSE. Critics fear combining the two self-regulatory groups will make it even harder for investors to get action on their complaints. Amy Scott reports.

Listen now.

Partner Pleads Guilty to Conspiracy in Milberg Weiss Case

In case you missed it, stories in the morning papers, including in The New York Times and The Washington Post, report that former named Milberg Weiss partner David Bershad has pleaded guilty to conspiracy charges stemming from a criminal case pending since last year against the Milberg Weiss law firm, Bershad, and another former partner, Steven Schulman.  As the Post summarizes it:

David J. Bershad, who oversaw financial operations at the New York-based firm, agreed to forfeit $7.75 million, pay a $250,000 fine and tell the government about how he and others allegedly obstructed justice and misled judges about secret payments to plaintiffs in scores of securities lawsuits.

The article explains that the Bershad plea bargain is likely to put pressure on others who may be implicated in the case.

Google and Privacy

Privacy advocates have lately been concerned about Google for a number of reasons.  Google reportedly retains records of user searches for eighteen months, has access to the emails of those using its gmail service, and can tell which addresses its users have searched for on Google maps, among other things.  Google's intended acquisition of Doubleclick has prompted EPIC, US PIRG and CDD to file a complaint with the FTC seeking an investigation into the privacy consequences of the acquisition (you can read the initial complaint here and supplementary materials here; EPIC has a page of information about the deal here).   

Google itself says quite a bit about privacy.  Highlights of its privacy policy appear here and from there you can jump to the full privacy policy.  Among the highlights is this quote: "We make good faith efforts to provide you access to your personal information upon request and to let you correct such data if it is inaccurate and delete it, when reasonably possible."  So on June 28, I sent Google the following email through its web site:

I have reviewed Google's Privacy Policy.  I would like to know what specific information, if any, Google retains about me.  For example, I would like to see a list of the search requests I have made that Google retains. 

Thank you.

I haven't yet heard back.  Google's web page through which I sent the email says "We'll review your note and follow up with you only if we require more info or we have additional info to share."  Consequently, I'm not sure if I will in fact hear back from them. 

State Security Freeze Laws

U.S. PIRG's Consumer Blog has this excellent discussion of state security freeze laws -- laws that allow consumers to put a freeze on their credit reports.  These laws are weapons against identity theft.  As the PIRG post puts it:

Your best defense against identity theft is to freeze your credit report. That way, when a thief applies for credit using your purloined Social Security Number, he or she is denied when the cell phone company or department store contacts the bureau and is told that your report is frozen.

The PIRG post surveys what various states have done and discusses the progress of weaker, but  non-preemptive proposed federal legislation.

How the Leegin Decision Will Hurt Consumers on the Internet

by Greg Beck

In Leegin Creative Leather Products v. PSKS, the Supreme Court last week overturned the nearly century-old rule in Dr. Miles Medical Co. v. John D. Park & Sons Co. that an agreement between a manufacturer and a distributor to set minimum prices is a per se violation of antitrust law. In doing so, the five-justice majority was persuaded by the amici curiae brief of twenty three economists, who argued that, at least in some cases, the availability of less expensive products on the Internet may be bad for consumers. The Supreme Court found persuasive the economists' argument that minimum-price agreements can help avoid the so-called "free-rider problem," which comes up when consumers shop at traditional retailers to make their decisions about what to buy but then use the Internet to find the cheapest available price. As the economists wrote:

A Sermon on Payday Lending

The District of Columbia Council, our local equivalent of a state legislature, is considering payday lending legislation.  Earlier today, on the WAMU radio station, the Reverend Graylan Scott Hagler of the Plymouth Congregational United Church of Christ delivered some passionate commentary on the evils of payday lending and the need for legislation in the District.  It's worth a listen.   (On a related note, proposed payday lending legislation has also recently been introduced at the federal level.)

Stripping the Meaning from Meaningful Choice

by Paul Bland and Alexis Rickher

In a series of decisions stemming back about 20 years, the U.S. Supreme Court has broadened the scope of the Federal Arbitration Act to make it possible for corporations to insist that their employees and consumers must submit more and more cases to mandatory arbitration. In making these decisions, the Court has effectively said “it’s alright to expand mandatory arbitration, because courts will guard individuals against unfair arbitration clauses using traditional rules of contract law.” Under the Supreme Court’s guidance, a consumer or employee can’t argue that mandatory arbitration is unfair in itself, but if a corporation has written an arbitration clause that tacks on other unfair provisions that are not necessarily a part of arbitration, courts can strike down those provisions as “unconscionable.” (See Footnote 1)

Following the Supreme Court’s guidance on this point, when corporations have tacked unfair provisions onto arbitration clauses, a host of courts have struck down those provisions as unconscionable and unenforceable in particular cases. There is a general rule of contract law in every state (although the contours and scope of this law varies quite a bit from state to state) that unconscionable — which can be roughly paraphrased as very unfair — contract terms will not be enforced, and courts have played an important role in blocking some of the most unfair types of arbitration clauses that some corporations have tried to force on their customers and employees. For example, some courts have struck as unconscionable the following types of arbitration clauses:

• Clauses that would require individuals with small claims to travel great distances across the country to arbitrate their claims. (See Footnote 2)
• Clauses that would not only send people to arbitration but would also re-write the laws, so that the statutes of limitations would be changed to the point that individuals would have to bring their claims within a few months of having been wronged, even where the laws normally applicable to their claims would give them several years to bring their claims. (See Footnote 3)
• Clauses that would require individuals to pay more in fees to the arbitrators than the amount of money at issue in their case. (See Footnote 4)
• Clauses that would require individuals to submit to gag orders that barred them from speaking to anyone — even relatives! — about the facts or outcome of their cases. (See Footnote 5)

Scam-Baiters Scam E-Mail Scammers

For those who would like to see e-mail scammers trapped in their own cons, Monday's Times had an article on people who do just that, headlined "A Web Cadre Turns the Tables on African Scam Artists."