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New HBO Film Promotes Arbitration Fairness Act

Tuesday, July, 19, 2011

The Arbitration Fairness Act, a proposed set of limitations on the use of mandatory binding arbitration, has received several boosts since the U.S. Supreme Court ruled that arbitration clauses in credit and consumer contracts can be used to prevent class arbitration, leaving individuals suffering harm no option but to pursue the more costly approach of arbitrating each claim separately.  Now, a new HBO documentary film is adding its voice to those clamoring for arbitration to be more strictly regulated and controlled.

Film Promoting Arbitration Fairness Act Focuses on Coffee

The film, directed and produced by Susan Saladoff, a former medical malpractice attorney, uses the case of Liebeck v. McDonald's Restaurants as its centerpiece.  This 1994 case, known throughout the nation as the infamous "hot coffee" case, led directly to an effort nationwide to cap lawsuit damages and enact tort reform.

The Liebeck case did not involve arbitration, but Saladoff uses it to illustrate how binding arbitration provisions have proliferated in the years since 1994 as corporations seeks to protect themselves against the prospect of consumers using the court system to recover large damages.  

"Hot Coffee" features an extended cameo by Senator Al Franken, who is instrumental in a move to ban mandatory arbitration clauses in certain kinds of contracts.  Along with other lawmakers, Franken has reintroduced the Arbitration Fairness Act into Congress.  If passed, the act would change the rules for credit arbitration, along with other arbitration types.