How Forced Arbitration Can Ruin your PI Claim

Posted on August 15, 2022 in Personal Injury

Many large corporations try to prevent themselves from getting into litigation by forcing consumers into something called forced arbitration. This is an alternative method to resolve a legal dispute, but it can be detrimental for an injury victim and their personal injury claim. Here, we want to discuss how forced arbitration can ruin a personal injury claim and what you can do if you find yourself subject to this practice.

What is Forced Arbitration?

Arbitration itself is an alternative dispute resolution method used by parties who have a grievance, and arbitration is typically done by a neutral third-party mediator. Usually, arbitration takes place outside of a courtroom, with no judge or jury. The neutral third party is the one who decides the fate of the dispute and what action should be taken.

Often, contracts include forced arbitration clauses that require any dispute between an individual (typically a consumer) and a company to go through the arbitration process, which means there will be no judge or jury to hear the severity of a potential case.

Information presented by the National Consumer Law Center states that forced arbitration is often found in the fine print of contracts, including many contracts that you likely sign on a regular basis. This includes contracts for bank accounts, cell phone agreements, employment, and student loans. However, forced arbitration clauses are also often hidden inside many of those agreements you sign in order to use various mobile apps, agreements that you likely never read all the way through.

Forced arbitration clauses typically ban individuals from joining a class action lawsuit against the entity asking for the clause, and they typically prevent judges or arbiters from addressing the wrongdoing of a company. These clauses usually mean that individual disputes never come to light, which is, as far as the company is concerned, a “win.”

How This Can Hurt a Personal Injury Claim

The effect of forced arbitration on consumers, particularly personal injury victims, is that they may end up with much less compensation than they otherwise would receive if they were able to file a lawsuit against the at-fault party. When a consumer agrees to forced arbitration, this will almost always prevent them from filing a personal injury lawsuit in civil court against the person who caused their injury, even if negligence on the other party is clear.

When a case cannot be heard in front of a judge or jury, this puts it completely in the hands of a third-party neutral mediator. The main problem with this is that the company against which the complaint has been made is the one who gets to choose the arbiter, and they also control the arbiter’s salary.

Do you see the problem here?

Inevitably, the arbiter will be more inclined to rule in favor of the company that is allegedly responsible for causing an injury as opposed to the injury victim.

If you or somebody you love has been injured due to the negligence of another party, we strongly encourage you to reach out to a skilled personal injury lawyer in Portland who can examine the facts of your case and help you determine the best as moving forward to recover maximum compensation.