Corporate America’s Favorite Legal Trick Is Backfiring
For decades, companies have used arbitration agreements to shirk responsibilities to their customers and employees. Now the tables are starting to turn, as customers and employees use such agreements against corporations.
Victims of corporate malfeasance are turning to mass arbitration because it offers a way to force companies to pay up for their misdeeds. (Scott Graham / Unsplash)
Last year, Uber turned a quarterly profit for the first time ever. But a major obstacle stands in the way of the rideshare company repeating that achievement: a $92 million bill owed to the American Arbitration Association over claims that Uber discriminated against businesses when it said it was waiving Uber Eats charges to certain black-owned restaurants after the police killing of George Floyd.
Uber has been trying to sue its way out of paying the tab — but a recent New York appeals court decision blocked their request for an injunction to stop the arbitration association from collecting the bill.
Uber is one of several companies that has been targeted by a new legal tactic for vindicating the rights of aggrieved consumers and employees: “mass arbitration,” which is based around the very same tool that corporate America has used for decades to insulate itself from legal responsibility.
This article is for subscribers only. Please login or subscribe to access our full archives and beautiful print and digital magazine starting at just $3 a month.