Suckers Wanted: How Car Dealers and Other Businesses are Taking Away Your Right to Sue

Washington Dispatch: Mandatory arbitration provisions, forcing people to waive their legal rights, have become standard fare in consumer contracts. Now, Congress is beginning to push back—and the business community is mobilizing for a fight.

By Stephanie Mencimer

November 26, 2007

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Our car is old. The 1993 Honda Accord has more than 145,000 miles on it, but it's paid for and still runs pretty well despite the rust. But this year my husband and I decided the time had come for an upgrade—not a new car, of course, but newer than the one we're currently driving. Something with airbags.

The perils of buying a used car have been well documented, and the industry sleaze is so ubiquitous that it's inspired a handful of Hollywood movies (see the classic 1980 flick Used Cars, starring Kurt Russell) and a genre of jokes ("How can you tell when a car dealer is lying? His lips are moving."). So we approached the whole ordeal with trepidation. But after months of research and anguish, we finally decided to pull the trigger on a "certified pre-owned" 2007 Volkswagen Passat Wagon, which we found at the nearby Wes Greenway's Volkswagen dealership in Alexandria, Virginia.

After much hassle, the dealership allowed us to bring home the sales paperwork so we could read it over without the salesman hovering over us. Everything seemed to be above board until we got to the end of the buyer's order and discovered that if we signed the contract, we would waive our rights to sue the dealership in court, before a jury, should any dispute arise after the sale. Instead, as a condition of buying the car, we had to agree to submit to mandatory pre-dispute binding arbitration, handled by the dealership's pre-selected company, the National Arbitration Forum (NAF).

After learning this, we called our sales guy, Carlton Cotton, and told him we wouldn't agree to an arbitration clause, but if they took it out, we'd write a check. "That's not negotiable," he said. Cotton explained that the dealership inserted the clause to make things simpler for everyone. "We think it's fair," he said, and then went on to inform me that we wouldn't be able to buy a car anywhere without agreeing to arbitration. Clauses like this are standard fare in car contracts throughout the region, he told us, so we should just sign the contract or lose the car to another customer.

So we walked. Because there is nothing fair about mandatory arbitration.

In its early incarnation, arbitration was designed as a way of resolving disputes outside of the courts, and it's often still used that way when both parties agree to it. But the mandatory arbitration provisions in consumer contracts are very different animals. As I discovered, they aren't voluntary, especially when an entire industry has adopted them, making individual legal rights all but meaningless. These sorts of provisions, buried in the fine print of consumer contracts, have become de rigueur in everything from employment contracts to cell phone agreements to software licenses. Most people don't even realize they've signed one. They really only come into play if a customer is defrauded—for instance, if the "certified pre-owned" car we were buying turned out to have been totaled by its previous owner, the source of many lawsuits these days.

Mandatory arbitration clauses are designed to take fraud cases into a world of private justice, where big corporations hire the arbitrators that hear their cases and there's no right to appeal. Most importantly, unlike court proceedings, arbitration is secret, with no transcripts or written decisions, so that nosy reporters or other potential plaintiffs can't learn what's going on behind closed doors.

That, of course, is why car dealers and other corporate actors like them so much (companies like Hooters, for instance, which puts arbitration clauses in its employment contracts so sexual harassment cases won't go to a jury). Car dealers are eager to avoid cases like one this year in Baltimore, where a jury awarded over $400,000 to a woman who bought a new car that turned out to be used. When the car broke down, she called the dealership, which told her to have it towed to the lot where they'd give her a loaner. When she showed up with the car, and her 11-year-old child with her, the dealership tried to have her arrested for trespassing and then moved her disabled car to a tow-away zone. "The jury didn't like them," says her lawyer Peter Holland.

Arbitration seriously tilts the playing field in favor of businesses. Companies like the NAF, which our Volkswagen dealership used, market themselves to businesses as an alternative to the "million-dollar lawsuit." NAF rules eliminate many of the protections given to both sides of a dispute in court, things like meaningful discovery. The NAF also permits arbitrators to order losing parties to pay the other side's legal fees, which they do regularly, raising the stakes considerably for anyone trying to find relief from fraudulent and deceptive practices*. And arbitration is extremely expensive. Consumers have to pay the arbitrators just to hear their claims, unlike the public courts, where the taxpayers pay the judges. Arbitrators often charge hundreds of dollars an hour for their services.

All of this is especially nefarious given that the vast majority of consumers who attempt to seek justice in mandatory arbitration lose. The nonprofit consumer group Public Citizen recently analyzed data the NAF provided to the state of California, one of the few states that actually requires arbitration firms to disclose information about their results. Public Citizen found that in 94 percent of 19,000 cases, NAF arbitrators ruled in favor of the businesses that hired them. One arbitrator handled 68 cases in a single day, awarding every penny that the big companies were seeking. In one case Public Citizen looked at, the NAF also charged $1500 for a three-page document explaining the arbitrator's decision, something unheard of in regular courts.

"Consumer outcomes in arbitration are the same as in court," says Roger Haydock, the NAF's managing director. "Every published study and all empirical data indicate consumers prevail at a rate that is greater than or equal to litigation, where similar subject matter is at issue. Evaluating arbitration outcomes is only meaningful in comparison with court outcomes of similar cases."

Even if consumers did fare just as well in arbitration as in court—a notion that's hotly disputed by consumer advocates—there is still one fundamental difference between forced arbitration and a traditional lawsuit that's not in dispute: the absence of any meaningful judicial review. If a jury or a judge gets it wrong, a decision in court can be checked by a higher power. Courts have ruled that however wacky the rulings, arbitration awards can't be appealed.

The NAF is one of the biggest players in the arbitration world, but it is far from alone. The American Arbitration Association (AAA) handles disputes with big firms like Halliburton, which places arbitration clauses in its employment contracts, and the drug company Pfizer. Halliburton won 32 out of 39 cases arbitrated against it by an employee over a four-year period, according to Cathy Ventrell-Monsees, an employment lawyer who testified at a House committee hearing last month on arbitration. Pfizer did even better, winning 97 percent of its cases over a four-year period, according to Ventrell-Monsees.

One reason businesses often come out on top in arbitration is that arbitrators who rule for consumers have a tendency to find themselves out of work. Such was the case with Richard Neely, a former chief justice of West Virginia's Supreme Court, who worked briefly as an arbitrator for the NAF. In an article called "Arbitration and the Godless Bloodsuckers," Neely reported that he had refused to award a bank arbitration-related fees that he judged to be far in excess of what a court would have charged. He never got another case. Neely is not alone. A 2000 study of forced arbitration in HMO contracts found that on the rare occasion that an arbitrator made a significant award for a patient, the HMO never hired that person to arbitrate a case again.

Consumer arbitration horror stories abound. Last month, a Maryland woman named Deborah Williams testified at a hearing in the House about her dispute over a Coffee Beanery franchise. Despite the fact that Maryland's attorney general determined that the Coffee Beanery had defrauded her, she was forced into arbitration in Michigan, where the company is headquartered. The Coffee Beanery's attorney actually worked as an arbitrator for AAA, the same firm handling her case, and her arbitrator shared an accounting firm with the company, a clear conflict of interest. Despite the decision from Maryland's attorney general, the arbitrator ruled against Williams, assessed her $100,000 for the cost of the arbitration, a $150,000 judgment to be paid to Coffee Beanery, and ordered her to pay the company's legal fees as well. Williams is now bankrupt and nearly homeless as a result and can't appeal the decision. She will be paying off the award for the rest of her life.

Mandatory arbitration clauses are so insidious that car dealers actually furiously lobbied Congress to get them banned in their contracts with auto manufacturers. The National Automobile Dealers Association wrote members of Congress in 2000 that if they weren't outlawed for the dealerships, mandatory binding arbitration clauses would allow "multinational motor vehicle manufacturers…to be able to unilaterally deny small business automobile and truck dealers rights under state laws that are designed to bring equity to the relationship between manufacturers and dealers." Congress agreed and passed legislation protecting the dealers. Apparently, though, the car dealers didn't see a problem in using the same sort of underhanded contracts with their own customers. (Some of them may also be forced to use the clauses whether they like it or not. Several major auto manufacturers' credit divisions have told their dealers that they won't provide financing to any dealerships that don't have arbitration clauses in their sales contracts, says Paul Bland, a lawyer and expert on arbitration at the nonprofit law firm Public Justice.

With the new Democratic Congress, a movement is afoot to get rid of the provisions for everyone. Consumer advocates have started small. For instance, last year, when Congress passed the Defense Department appropriations bill, it outlawed arbitration clauses in lending agreements made to members of the military and their dependents. Senator Charles Grassley, the Iowa Republican, has included a measure to ban arbitration clauses in contracts between poultry farmers and big buyers like Tyson and Perdue. The anti-predatory-lending bill just passed by the House also included a measure that would prohibit mandatory arbitration clauses in residential mortgages. Congresswoman Linda Sanchez is working on a bill that would extend the protections given to car dealers to their customers in auto sales and leasing agreements.

Meanwhile, Senator Russ Feingold (D-Wis.) and Rep. Hank Johnson (D-Ga.) have introduced legislation that would amend the Federal Arbitration Act to get rid of mandatory, pre-dispute arbitration clauses in all consumer and employment contracts. That bill has the business community mobilizing against it, in part because there is some hope it could pass. The arbitration issue is not strictly a partisan one. When the House held hearings on Johnson's bill, several of the witnesses who spoke in support of the legislation were longtime Republicans, including Deborah Williams, the former Coffee Beanery franchisee, and Ken Connor, a movement conservative who was Jeb Bush's lawyer in the Terry Schiavo case and a former head of the Family Research Council. Connor represents the victims of nursing home abuse, many of whom have been forced to sign mandatory arbitration clauses when getting admitted into a home.

Larry Akey, a spokesman for the U.S. Chamber of Commerce's Institute for Legal Reform says that the business community is already laying the groundwork for an ad campaign and other lobbying efforts to educate the public about its position. "Efforts to force people to hire attorneys for even the smallest dispute are wrong," he says, noting that consumers don't need a lawyer in arbitration. Akey says that the movement to ban arbitration clauses is not driven by consumers but by trial lawyers. "The real motive on the part of the trial bar is to wipe out prohibitions on class actions, not to protect consumers."

Given the fight ahead, there's not much hope that Congress will get anything done before I need to buy a new car. Thank goodness for Craigslist.

*Correction: This article originally stated that the NAF requires losing parties to pay the other side's legal expenses. The NAF permits arbitrators to make that determination, but doesn't require it.

Stephanie Mencimer is a reporter in Mother Jones' Washington, D.C., bureau.

Comments:

"How can you tell when a car dealer is lying? His lips are moving." Actually, that's not the Joke. The original is "How can you tell if a LAWYER is lying..." Which, though i don't respect used car dealers much, should make you think about things a little. Not that I get all pookie on the frivelous lawsuit bandwagon, but there are plenty of rotten corrupt lawyers - probably causing more harm than car dealers.

Posted by:TuckerNovember 26, 2007 2:42:57 PMRespond ^

Tucker - Given that all three branches of the Federal government have abandoned their roles in checks and balances, and that corporate lobbyists have gutted most consumer protections, and the media is now controlled by two or three major corporations, trial lawyers have become the last line of defense for consumers that have been wronged. And no, I'm not a lawyer. But when I've been screwed, you can bet I'll need one because the President, judges, and legistlators have abandoned us.

Posted by:blueNovember 26, 2007 3:10:52 PMRespond ^

Arbitration Clauses protect the bad builders and the bad lenders. Arbitration is a contract between the builders and the arbitration company. A conflict of interests, a partnership already exists. Arbitrators salaries depend on pleasing their repeat clients, the builder. Homeowners will probably never be able to afford another home. Many of them end up in foreclosure, bankruptcy are homeless or living with family members. These are NOT sub prime loans. The costs associated with arbitration are outrageous! WHY IS NO ONE EVEN MENTIONING THIS CRISIS? WHY AREN'T OUR REPRESENTATIVES OUTRAGED? Google my name for more on this subject and the housing debacle. Jordan Fogal jfogal281@aol.com

Posted by:Jordan FogalNovember 27, 2007 8:05:17 AMRespond ^

I think the Alexandria VW dealer needs some pickets: 2, 4, 6, 8, we ain’t gonna arbitrate! Maybe the Virginia trial lawyers can pull that one off.

Posted by:John VailNovember 27, 2007 8:18:03 AMRespond ^

The “Lemon Lady,” Houston grandmother Jordan Fogal, testifies colorfully against Texas homebuilder mandatory binding arbitration provisions to a congressional subcommittee in Washington: The first night in our new home, my husband decided to try out his new Jacuzzi tub on the third floor. When he pulled the plug, one hundred gallons of water crashed through our dining room ceiling. . . . Well, this was not one overlooked plumbing connection, as my husband so desperately wanted to believe. It was a preview of coming attractions. Rainwater, from outside, sprayed us at the kitchen table. – The windows were installed upside down (our builder finally admitted this after three years). Our floors buckled and black spider-webs of mold crawled up our walls; the smell grew worse; then shower wall fell out and little puffballs grew out of the carpet. All the while, we had begged our builder to please fix our house. We had the mold tested by an accredited laboratory, and they said they had never seen toxic readings that high in an inhabited dwelling. The story of Fogal’s Hyde Park Crescent home was detailed in Mother Jones magazine two years ago; she also plays a part in this Houston Press report about the lucky owner of another Tremont Homes/Jorge Casimiro opus. Written Testimony Submitted by Jordan Fogal To The Subcommittee on Commercial and Administrative Law: “Mandatory Binding Arbitration Agreements: Are They Fair For Consumers?” [U.S. House Committee on the Judiciary, Home Sour Home [Mother Jones] Ownership Wrongs [Houston Press]

Posted by:Jordan FogalNovember 27, 2007 9:08:12 AMRespond ^

When one of the parties in a dispute hires the judge (the arbitrator) there is a conflict of interest for the judge. How can one argue that a conflict of interest, no matter how small, has no effect the result? When the results of arbitration are binding and cannot be disputed, the stakes are raised for everyone exacerbating the conflict of interest. Finally, when the arbitration organization can charge the loser fees for various functions and collect from the company employing it, that conflict of interest grows radically. Human nature seems to tend toward the dark side in direct proportion to the degree of conflict of interest. I challenge anyone to lay out a logically sound intellectually honest argument proving that conflict of interest does not effect the judgment of a person in such a situation in favor of the the hand that feeds.

Posted by:3rd-ChimpNovember 27, 2007 10:15:26 AMRespond ^

Great article - how do you suppose one would notice this sort of thing? I mean, can we get a step by step warning checklist to look for when buying a car? what about other things? God knows I never read fine print and probably never will unless I know what I'm looking for. Thoughts?

Posted by:Lobster 67November 27, 2007 10:19:05 AMRespond ^

Although I agree with the story here, there are two irritating points - one, the headline is a classic "business is evil" headline. That's lame and accusatory - business is NOT evil. There are rotten people out there that screw it up, but there's nothing inherently evil about it. Second - there are also evil people on the plaintiff side, including lawyers who have extracted ludicrous settlements that scare business into enacting draconian contracts like this. The big problem is the greed in our culture - NOT business and NOT lawyers per se.

Posted by:Russ MeylNovember 27, 2007 10:23:29 AMRespond ^

I'd like to build my OWN car, sans the 900 pounds of bells and whistles they preload against your GVW. Maybe starting with an inline-6 running on pure ethanol and a tall overdrive, and for your in-car enjoyment, an authentic, old-time AM radio...be really nice, and put a heater in it, too. Maybe even seats! LOL

Posted by:BertNovember 27, 2007 10:24:04 AMRespond ^

When buying a car, you have 2 options. One, ask around (friends and family) for a dealer with a good reputation, have a mechanic check out the car, check it out yourself (CarFax) and READ the contract. Or two, depend on the government to take care of you. Personally, I'm leaning towards caveat emptor.

Posted by:RaulNovember 27, 2007 11:14:19 AMRespond ^

Business IS evil. Business IS unethical. It's ALL about money. To deny this is to live in ignorance.

Posted by:aClueNovember 27, 2007 12:26:36 PMRespond ^

Arbitration clauses are in just about everything now. House purchases, computers, software, warranties of all kinds, nursing home admittance, medical care, phone service, sports event tickets, disputes with a stock broker, real estate agent, home inspector, contractor, etc. You may get the arbitration "agreement" after buying, without having actually signed it, but it's still binding on you. Anyone who thinks they can just refuse to sign, or cross it out, or get a court to deem it unenforceable, is mighty naive. The courts are enforcing mandatory arbitration even in what used to be considered clear contracts of adhesion, for example. More consumers SHOULD just walk away from any purchase they possibly can, if the seller won't strike the arbitration clause. However there are still many services and products we can't realistically do without today where consumers are truly stuck. Passage of the Arbitration Fairnless Act is the only real hope consumers have of regaining their constitutional right to use the courts, hold companies accountable, and keep such complaints in public records instead of in secret. (Only CA makes arbitration awards public record, and even then a "win" for a consumer can be pennies on the dollar of their actual damages.) By hiding the fact there even was a dispute, thousands of complaints are hidden in most cases, making it almost impossible for consumers to REALLY know who's reputable and who's not, before they buy.

Posted by:CindyNovember 27, 2007 2:41:46 PMRespond ^

Big businesses use arbitration clauses as a legal right to screw over the consumer be it a cell phone, auto or a house. Big builders can build a house devoid of quality construction and get away with it. Why? because most consumers cannot afford arbitration. The big business can tie it up for years and you either run out of guts, money, time or all three. What really gets my goat is that a big business blatantly bites the hand that feeds it AND doesn't care one iota. Every citizen of the United States should be up in arms and writing, emailing and calling their senators and congressment to demand the bill to stop binding arbitration be signed into law. Don't say this doesn't affect you because you have never had a problem. Until late 2006, neither did I. Let's take back our rights.

Posted by:SusanNovember 27, 2007 6:30:42 PMRespond ^

How r U ? Wish u all the best in all ur endures

Posted by:John GreenNovember 27, 2007 10:53:29 PMRespond ^

Arbitration works just fine for most disputes, as long as the arbitrator is selected by the parties jointly. It's the preselection of conflicted arbitrators that causes the problems noted above.

Posted by:Eric RootNovember 28, 2007 7:00:32 AMRespond ^

I love Ham and my name is Cory Doctorow

Posted by:Cory DoctorowNovember 28, 2007 7:31:24 AMRespond ^

This article is so one-sided; it should be kept in mind that many states have arbitration-related provisions and will not uphold an arbitration provision (especially in a consumer contract) unless certain formatting requirements are met, all of which are intended to warn the consumer about the provision. Also, consumers who won't actually take the time to read their contracts are in no position to complain. Don't sign something you haven't read; and if you do, don't feign victimhood and act as if the wool was pulled over your eyes. Take some responsibility for your own actions for Pete's sake and stop blaming everyone else for your mistakes!

Posted by:CTVNovember 28, 2007 11:59:06 AMRespond ^

Is anyone even remotely surprised that big business has tipped the scales once again against the consumer? Why the surprise? This is vulture capitalism at its finest! If you want to buy a used car, purchase it from a private party; to hell with dealerships!!

Posted by:Nic SmithNovember 28, 2007 1:13:49 PMRespond ^

Gee does this surprise anybody, since these and other money grabbers can't seem to get the ball rolling on so-called TORT REFORM. They are forced to resort to any underhanded means they can come up with to continue to rip-off as much money as possible from us poor slobs who seem to have fewer and fewer means to rectify injustices, purportrated by a growing number of unscrupulous capitalism over all else types. Binding arbitration,TORT REFORM etc. Someone save us from these crooks.

Posted by:xvetNovember 28, 2007 2:05:15 PMRespond ^

Stephanie has done consumers everywhere a favor by exposing this issue. These clauses NEVER help the consumer. Often the arbitrators are selected for their bias and the expense is often much greater than what would be encountered in court. In many credit card so called contracts the arbitrator is far from the consumer's home and even minimal due process (reasonable notice and opportunity to present your case) is not observed. Call your congresspersons now!

Posted by:billybookwormNovember 28, 2007 2:29:10 PMRespond ^

Arbitration might work if either party has the option to go to court if the decision is not satisfactory to either party. But the taking away of the justice system by owners from the government is one more example of the privatization movement. Privatization leads to the power of the owner being able to take away from the customer without consequences, considering the delay to which market response is subject. That is not capitalism. That power of the owner is parallel to the power of the owner of the estate over the serfs in that he or she can arbitrarily give or take away goods from a serf.

Posted by:GPFrankNovember 28, 2007 3:01:49 PMRespond ^

Let's not forget the DOC fees most if not all car dealers charge. Usually somewhere in the $250 to $600 range. This because they have to do the paper work on the car they are selling you.Small in comparison, but another money grab that is non-negotiable.

Posted by:BoNovember 28, 2007 3:51:41 PMRespond ^

Thanks, once again, to Mother Jones for excellent reporting and going where other journalists fear to tread.

Posted by:Claudia RyanNovember 28, 2007 4:43:42 PMRespond ^

Obviously you're a shill for the industry.

Posted by:JesusNovember 28, 2007 6:47:53 PMRespond ^

This is good information. My daughter bought a car under the false statements of a dealer. They took her car but did not pay off the trade in as agreed. BUMMER

Posted by:Gene FloydNovember 28, 2007 7:53:32 PMRespond ^

I could add a long chapter to this story with a completely corrupted 5 year long encounter sponsored by the American Arbitration Association. I should call it "criminal" instead of "corrupted" when factual evidence is disregarded and injustice prevails.

Posted by:S. WinnNovember 28, 2007 8:54:12 PMRespond ^

Stephanie Mencimer, thanks

Posted by:AnnNovember 30, 2007 3:03:04 AMRespond ^

Hey Tucker, thanks! Your sooooo smart pointing out that it was a Lawyer joke first!!! How do you know Einstein; did you write the joke? Maybe YOU are a car dealer...no, you must just be a dumb ass.

Posted by:StephenNovember 30, 2007 8:31:04 PMRespond ^

"Privatization" marches on, from private armies carrying out armed occupation of foreign countries to privatized judges negating one's right to a day in court. There's somethng very feudal about the system that is evolving here in the US, our Corporate Lordships hire the arbitration "judges" that decide the cases we peons might bring against our right honorable overlords.

Posted by:LauritzDecember 1, 2007 10:02:05 AMRespond ^

Two years ago when signing paper for my new car I was smacked in the face by one of these Arbitration Agreements. I refused to sign it of course, as it was so outrages, unbelievable in fact. The next day I called the Virginia State Board for Automobile Dealers to see if this agreement was legitimate, could auto dealers get away with such ludicrous contracts. The Virginia State Board System is part of the legislative body here in Va. The purposes of the many different boards are to protect the rights of Virginia citizenry, not the rights of the Automobile Dealers. I quickly learned that all of the board members were all former or current automobile dealers! My worst fears were confirmed, it was as bad as it sounded. I am very glad to see that someone else knows about this as well.

Posted by:Richard BeasleyDecember 1, 2007 10:38:18 AMRespond ^

I recently bough a car after two weeks they took it back because they could finance me their commercial says they can help any one at the end they screw me over can they do that lie like that??

Posted by:CelestDecember 2, 2007 8:35:19 PMRespond ^

There ought to be a law against the arbitration clause,due to our right to justice

Posted by:Diana CooperDecember 3, 2007 12:51:15 AMRespond ^

Cindy that is not correct. Read The Maryland Franchise Registration and Disclosures Laws. A franchisor has to consent to suit in Maryland in order to sell franchises here. Our Franchise Agreement was amended to adheare to Maryland Law. I can do better then that. We just found Documents that show an arbitrator was picked 6 months before filing to compel arbitration. WHAT COURT DOES THAT HAPPEN IN? Please remeber that the Arbitration Fairness Act if passed, gives consumers the choice to arbitrate or go to court. You should be upset that people like me who thought that had a Constitutional Right to a Trial by Jury, was railroaded into what is looking like a fixed judicial system.

Posted by:Deborah WilliamsDecember 6, 2007 2:04:10 PMRespond ^

I had to sign one of these a week after reading this article. When I asked what happened if I didn't sign in, the kid was really confused. I'm wondering about another issue, really. We've had some plumbing issues. I'm wondering if anyone else has had an experience that made them wonder if Roto Rooter and ServPro basically create work for one another. Roto Rooter came to "fix" the plumbing, and I think, while they did do that, they also created a huge blackwater flood that they then called ServPro to clean up. Since then, ServPro's had to have Roto Rooter back to do things "they're not certified to do." Another friend had a similar situation. Luckily, I didn't (as far as I know) sign a mandatory arbitration agreement with Roto Rooter, just with ServPro. Is there someone who knows how to investigate a link between these 2 companies?

Posted by:KatieDecember 7, 2007 6:17:43 AMRespond ^

I worked for a major auto manufacturer's legal department in lemon law (of course as a closet liberal). This idea was floated and finally pushed way back in 2004. All of the bigwigs in the company were excited and thought this would be the end of lemon law lawsuits. So naieve and petty, it was pretty hilarious, to see how dumb they thought the public really was. After millions were pumped into pushing the idea, brochures printed, and much patience exhausted by dealers and so on, I was pretty relieved that only a small handful of customers had turned in their forms waiving their rights to sue. When I last spoke with someone over the department, it turned out that claims had skyrocketed - and none of them were filed through "sucker alley". All of them wanted attorneys and huge payouts. Piss off your customers by taking away their right to sue, and you get a slap in the face that will leave you bruised for a generation. I was pretty happy.

Posted by:Ginger WinchesterDecember 7, 2007 9:32:32 AMRespond ^

Please also know that corporate in-house legal experts, lawyers, etc etc, know by trial & error which judges, court districts, states and such have the most favorable outcome for corporations. There is a reason why Maryland, among others, is the guinea pig state for most nightmares like these. They can watch outcomes in cases closely and shape their game plans on winning cases, strategizing at every corner against the consumer. This is how they move on to bigger states. Practice makes perfect, and we are their test dummies.

Posted by:Ginger WinchesterDecember 7, 2007 9:41:39 AMRespond ^

I havent had arbitration problems, but your part about buying new, thats really used has crept up on me recently. I purchased a pressure washer from home depot, when I went online to register it for warranty, I was told I couldnt as this machine was sold 2 years ago. I even sent them a picture of the serial number on the machine to confirm it. So I contacted the Home Depot store I bought it at. I was told they would have to research this and get back to me. a month passed, I called back several times. 2 months passed. I contacted corporate. Corporate contacted the store, and told me the store said they took care of the problem. ???? Long story short, after 4 months I got a gift card and a sorry. oh, and the machines spray handle started leaking so bad it wouldnt spray out the tip anymore. And being I couldnt register it, I couldnt use the warranty, and I couldnt use the gift card to buy the parts from the pressure washer manufacture either.

Posted by:livesipogDecember 8, 2007 3:17:40 AMRespond ^

There is an easy solution. Don't want to arbitrate? Fine, then don't sign the contract. That was real simple.

Posted by:JamesDecember 11, 2007 9:43:14 AMRespond ^

Posted by:exactlyDecember 13, 2007 3:40:12 PMRespond ^

You have a lot more recourse with a car dealer than a private seller. Dealers can offer warranties, financing, etc. Dealers sell millions of cars every year and the amount of sales that end up in lawsuits or arbitration is neglible.

Posted by:MikeyDecember 27, 2007 6:48:02 AMRespond ^

How much money do you think they make when they have to take the car back? ZERO! You did not get screwed, your credit was obviously too bad to get a bank to purchase your loan.

Posted by:MikeyDecember 27, 2007 6:51:55 AMRespond ^

Just bought used car without using dealer. Got a great car. Here's how. Use three websites: 1) Kelly Blue Book to get the correct value, 2) Carfax (one-time small fee for 30-day acess) which provides DMV records, including true mileage and accident history and finally, 3) website for guys who do Car Talk on NPR - section of site gives contact info for reputable mechanics in every zip code- so they can check the car wherever you find it. Using Craigslist and Autotrader online seemed like too much of a no-brainer to list.

Posted by:fyiJanuary 4, 2008 9:08:54 AMRespond ^

Stephanie: I have been in auto sales for over 30 years. I have many happy customers, and I have built this business by trying to do the right thing when problems arise. I have never intentionally lied to a customer, but not a day goes by that a customer doesn't lie to me. Believe what you will. By the way, everything costs more because of suits being filed and ridiculous awards going to people for little reason. Arbitration by independent means is only common sense.

Posted by:Tom DooleyJanuary 5, 2008 11:47:03 AMRespond ^

I just got back from a used car dealer. While one guy took us out to look at a few cars a confederate(s) was able to get under the hood of my '91 Cutlass and kill the battery. When we returned to our dead old car we were greeted with such schlock as "look like it's time to trade that in" and "could be your starter." When confronted with THE question, "Did you kill my battery?" the dealer pretended not to know what that statement meant. Thanks for the letting me vent

Posted by:HarvJanuary 12, 2008 3:35:17 PMRespond ^

BROWARD COUNTY, FLORIDA, IS KNOWN FOR ITS CROOKED BAR ASSOCIATION, CORRUPT JUDGES and Rigged ARBITRATIONS by RESOLUTIONS,INC.,please see KANGAROO ARBITRATIONS.COM.,where privatized,outsourced arbitrations allow lawyers offices to evade the AMERICANS WITH DISABILITIES ACT.

Posted by:OPERATION GREYLORDJanuary 24, 2008 2:07:07 PMRespond ^

Please read my testimoney before the congresssional committee: the effects of arbitration on the consumer. Arbitration is also a culpret in the housing debacle.Yet many republicans still brag about the service they have rendered to "we the people" by taking away our seventh amendment rights with arbitration/tort reform. Please google my name. Jordan Fogal

Posted by:Jordan FogalJanuary 28, 2008 8:21:44 PMRespond ^

Car dealers rip you off with financing bumping up the buy rate (charging you a higher % rate for more profit)selling you an extend warranty for over $1200 that cost them $500. and the protection package $1000-1500 all they do is wax it and scotch guard the seats if they do that much. not counting the sales profit dealer holdback money and other manufactures dealer incentives. Oh forgot the GAP insurance they like to sell and LoJack and all the other over price profit makers...They make thousand off a car deal...and the used car you traded in is priced $4-5000 higher than what they gave you for resale. Many times as a salesman I made $1000-1700 on a sale. I quit the business because it smoke and mirrors packed with lies.

Posted by:ExCarManJanuary 30, 2008 5:14:53 PMRespond ^

Lawyers have always been dishonest.... arbitration makes it easy for THE BAR to encourage even more fraud.....THE PRIVATE ARBITRATIONS NEED NOT BE OPEN TO THE PUBLIC and lawyers like the absence of DUE PROCESS and NO TRANSCRIPTS..... NO RECEIPTS FOR THE JUDGE KICKBACKS,....kangaroo arbitration.com.

Posted by:sean conwayFebruary 14, 2008 12:19:32 PMRespond ^

I AM A REPORTER THAT IS PROHIBITED FROM INVESTIGATING CORRUPT ARBITRATION PRACTICES IN BROWARD COUNTY....... judge jay krokit gets kickbacks for referring cases to HOLLANDER's rigged deck....... KANGAROO ARBITRATION.COM.

Posted by:jordana mishoryFebruary 23, 2008 9:38:22 AMRespond ^

I hope that honest reporters like STEPHANIE MENCIMER will embarass the embedded reporters in BROWARD COUNTY, FL. and elsewhere to expose the theft of DUE PROCESS and EQUAL ACCESS and THE SEVENTH AMENDMENT by parasites at THE BAR.

Posted by:jeff stempelFebruary 24, 2008 12:19:09 PMRespond ^

I can't believe how nieve the public is, can't you see that there are more sue happy people out there then there are big mean car dealers. when people who buy old junk cars for 5,000$ go and sue for 50k it's not long before there out of bussines, or they raise there prices to cover losses and everyone suffers. thats why the world is like this.theoverspending broke but greedy consumers have sued dealers to death and the like to death. I know that there are bad deals out there but not like some of you make it seem. I have been dealing cars for over 10 years and never once did I sell a car that was other than the way i described it. but many times I was ripped of by consumers. people who never change there oil telling me there engine is bad 2 years later and the threats are unreal. let me give you some car buying advice and some general rules to live by. 1) if you are on a fixed budget stop trying to keep up with the jones's. buy what you cAn afford and stop financing everything!!! pay cash and when you have a problem later you will be able to fix it with your own pocket. read and advise yourself, stephanie is a cautiouse buyer but she wanted a passat, what for they have so many problems and are very costly to fix. do your homework stop blaming everyone who has more money than you. you want fair deals buy cars from reputable small independant dealers instead of carmax. you will never develope a personal relationship with anyone who can help you at a big store of anykind because there is no owner present only the company rules and they are in stone. you silly people ruined it when you ran to carmax wallmart sams club superfresh and all of those national chains. all because they were .50 cents cheaper, now they have no competition and they are 2$ higher and you have no wear els to go, the nice small guys are gone andguesswhat your kids will not have an oppertunity to own a business either all because you let the big players take over. stop suing stopm over-pending and stop trying to be big time and we can all live well. start encourageing our young people to open there own store and give yourself the chance to make real money. people these days think that working as a pencil pusher for a large company making a grand or two a week is bigtime. don't teach your kids that tell them to open there own business and make real money. we need the corner delie stors back what hapened to hank the meat man who always came around with a smile happy to let you pay next week interest free if you needed it. you cheap bums put him out of business when you went to walmart to save 50 cents now the big guys are telling you to kiss there buts and hey are ripping you of because the guy at the end of the street no longer owns the place an so there are no morals just procedure. you have created a monster! where is god and morals stop letting manmade rules guide you call on jesus for guidance. I am not some old decrepid guy i am 30 yes 30 and i have done well just being honest,conservetive, and trusting god. I hope that no one was offended I just wanted you all to see what no one brought to light!!!!!!!

Posted by:carmerchat@aol.comFebruary 29, 2008 10:36:45 PMRespond ^

THE FEDERAL ARBITRATION ACT was modeled on MUSSOLINI'S CORPORATE TRIBUNALS which were rigged in favor of the corporate elites and denied due process to citizens....KANGAROO ARBITRATION.COM.

Posted by:surreal news WSLR 96.5March 7, 2008 10:44:05 AMRespond ^

kangaroo arbitrations are most corrupt in BROWARD COUNTY, FLORIDA..... where michael hamaway abuses the elderly/disabled and ghostwrites for crooked arbitrator HO.

Posted by:FEE-GOUGING ARBITRATORMarch 7, 2008 10:47:46 AMRespond ^

I am in the car business. I have been in the business for 10 years now. All I have to say is that Carmerchat@aol right above me is absolutely correct. Amen brother!

Posted by:Just_IceMarch 28, 2008 11:52:07 AMRespond ^

ROGER HAYDOCK of NDF lies when he states that arbitration is fair to the consumer......... ARBITRATION IS A RIGGED DECK THAT FAVORS THE CORPORATE ELITES because judges and arbitrators are not neutral...... arbitrators more easily hide their bias.

Posted by:TOM PAINEMarch 30, 2008 1:28:26 PMRespond ^

It really is quite simple. If you are a dealership, you do good business, if you don't do good business and screw people, then you face the consequences. I never wanted to have to sue a dealership, ever, the dealership I'm suing had over a year to just fix the issue of selling me a rebuilt wreck and doing all the things they promised me. They didn't.

If I steal a car from someone, I'm going to go to jail. That's my bad decision I made. I suffer the consequences. Why should it be any different for a bad business dealership???

Posted by:Erika RiceApril 5, 2008 8:40:48 PMRespond ^

please tell me dose both the seller and buyer hafe to sign a arbitration agreement contact i went to used car lot in grand rapids michigan the car company told me they did not hafe to sing but on arbitration form it states sellers sign what up please help me kim

Posted by:kimApril 13, 2008 12:33:57 PMRespond ^

Posted by:kimApril 13, 2008 12:33:59 PMRespond ^

Posted by:kimApril 13, 2008 12:34:01 PMRespond ^

I would like to discuss Michael Hamaway. Please respond to noregretsnovictims@yahoo.com

Posted by:HamawayPerilsApril 27, 2008 5:10:32 AMRespond ^

hello....... noregretsnovictims.yahoo..... did MBH rip you off,,also....... was the case with jay spechler or thomas lynch or dale ross....... fraternally.

Posted by:kangaroo arbitration.comMay 14, 2008 2:29:02 PMRespond ^

RE ; hamawayPerils....... please write to the address in the site...... thanks.

Posted by:kangaroo arbitration.comMay 14, 2008 2:34:37 PMRespond ^

HORKY loves BRUCE ROGOW........ THE BAR arranged this marriage at NOVA LAW SCHOOL....... Hall of Judge Pimping...... michael hamaway and rhonda hollander and ex-judge jay spechler were maids of honor..... KANGAROO ARBITRATION.COM.

Posted by:ANTHONY HORKYJune 5, 2008 10:26:00 AMRespond ^

I recently purchased a new Scion Xd. After driving it home I discovered all the transmission fluid was under the car in my garage. Called Scion and told them it was defective and leaking off the lot and I wanted a refund. I drove it for 2 weeks before I discovered that puddle under my car wasn't water from the air conditioner. I was stone walled by Toyota and offered a 6 year 100,000 warranty on the drive train after they filled the transmission fluid and pronounced it good as new after driving it with no fluid. I read the statistics on arbitration, which was also offered as an option, and see that companies win 94% of the time. Should this tell Congress there is a problem? The person who states above that these laws were brought about by unscrupulous lawyers is an idiot. I have a Scion for sale if he's interested.

Posted by:MrBJune 16, 2008 11:20:39 AMRespond ^

What has happened here is the same in our justice system. There they can remove delete a statement immediately after it was spoken in a backroom conference and then follow up with presenting a printed document with false evidence...evidence that does not exist...but defrauds you and the reader of the document into believing it does exist. Fraud is fraud whether in a dealership or inside a public courtroom especially when it is from the public court employees themselves. Corrupt.

Posted by:WATHAFKJune 19, 2008 1:36:30 AMRespond ^

how can you tell when ex-judge jay spechler and michael hamaway are lying ........... their lips are all over each other .............. ask rhonda hollander of KANGAROO ARBITRATIONS . COM.

Posted by:john hagee mccainSeptember 19, 2008 4:54:08 PMRespond ^

sarah palin fan clubs in broward county , fl., are headed by commissar hamaway , dorky horky , john hagee , rod parsley , roda hollander and ex-judge jay spechler of THE BAR's HALL OF JUDGE PIMPING .

Posted by:senator phil grammSeptember 28, 2008 1:38:05 PMRespond ^

Alaskan wingnuts like WES KELLER ,appointed by governor palin and god ............ insist on privatizing social security , create a JUDGE PIMPING INSTITUTE , Modeled on JAY SPECHLER 's south florida gem and designing a CULTURE OF CORRUPTION based upon THE KEATING FIVE bribes to JOHN thief MCCAIN .

Posted by:SARAH PALIN RAPTUREOctober 6, 2008 1:08:00 PMRespond ^

Just more republican pro business BS.
buyer beware!!!!!!!!!!!!!!!

Posted by:r reitzOctober 18, 2008 2:53:34 PMRespond ^

After my recent warranty experience with an
expensive Audi, I can't see why anyone would want a VW or Audi. Buy American!
(or american made jap!)

Posted by:r reitzOctober 18, 2008 2:58:37 PMRespond ^

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Posted by:FommyOctober 29, 2008 3:21:00 AMRespond ^

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