Recently, I noticed the Minnesota Attorney General had filed a lawsuit against the National Arbitration Forum (NAF) and others. Knowing how lawsuits can sometimes drag along, this came as something of a surprise:
“Two major arbitration firms are backing away from the business of resolving disputes between customers and their credit-card and cellphone companies, throwing into disarray a controversial system that prevents unhappy consumers from filing lawsuits.
The American Arbitration Association said Tuesday it will stop participating in consumer-debt-collection disputes until new guidelines are established. Its decision came two days after another big group, the National Arbitration Forum, said it would stop accepting new cases as of Friday.”
It appears the Minnesota AG accused the NAF of not being sufficiently neutral, and the NAF took some drastic measures. A nice little chart helps illustrate the alleged scheme.
The timing of this settlement may be especially interesting. The Arbitration Fairness Act hasn’t moved much recently, which makes sense in light of all the other concerns in Congress. But if this story makes it into the traditional media, it may provide the impetus to push the Act and other similar statutes across the country.
Quinn Smith