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Consumer Arbitration Agreements: Costs of Arbitration

Where the AAA determines that a business’s failure to pay their portion of arbitration costs is a violation of the Consumer Arbitration Rules, the AAA may decline to administer future consumer arbitrations with that business.

Consumer Arbitration Agreements: D-1. Applicability

(a) In any case, regardless of claim size, the parties may agree to waive in-person/telephonic hearings and resolve the dispute through submission of documents to one arbitrator. Such agreement should be confirmed in writing no later than the deadline for the filing of an answer.

(b) Where no disclosed claims or counterclaims exceed $25,000, the dispute shall be resolved by these Procedures, unless a party asks for a hearing or the arbitrator decides that a hearing is necessary.

Consumer Arbitration Agreements: D-2. Preliminary Management Hearing

Within 14 calendar days of confirmation of the arbitrator’s appointment, the arbitrator shall convene a preliminary management hearing, via conference call, video conference, or internet, to establish a fair and equitable procedure for the submission of documents, and, if the arbitrator deems appropriate, a schedule for one or more telephonic or electronic conferences.

Consumer Arbitration Agreements: D-4. Time of Award

(a) The arbitrator shall establish the date for either final written submissions or a final telephonic or electronic conference. Such date shall operate to close the hearing, and the time for the rendering of the award shall commence on that day as well.

(b) The arbitrator shall render the award within 14 calendar days from the date the hearing is closed.

(c) The award is subject to all other provisions of these Rules that pertain to awards.

Consumer Arbitration Agreements: Table of Contents

Statement of Principles of the National Consumer Disputes Advisory Committee

Statement of Principles

Introduction: Genesis of the Advisory Committee

Scope of the Consumer Due Process Protocol

Glossary of Terms

Major Standards and Sources

Principle 1. Fundamentally-Fair Process

Principle 2. Access to Information Regarding ADR Program

Principle 3. Independent and Impartial Neutral; Independent Administration

Principle 4. Quality and Competence of Neutrals

Principle 5. Small Claims

Consumer Arbitration Agreements: Statement of Principles

PRINCIPLE 1. FUNDAMENTALLY-FAIR PROCESS

All parties are entitled to a fundamentally-fair ADR process. As embodiments of fundamental fairness, these Principles should be observed in structuring ADR Programs.

PRINCIPLE 2. ACCESS TO INFORMATION REGARDING ADR PROGRAM

Consumer Arbitration Agreements: Introduction: Genesis of the Advisory Committee

Recent years have seen a pronounced trend toward incorporation of out-of-court conflict resolution processes in standardized agreements presented to consumers of goods and services. Some of these processes (such as mediation and non-binding evaluation) involve third party intervention in settlement negotiations; others involve adjudication (binding arbitration). Such processes have the potential to be of significant value in making dispute resolution quicker, less costly, and more satisfying.6

Consumer Arbitration Agreements: Scope of the Consumer Due Process Protocol

The Consumer Due Process Protocol (Protocol) was developed to address the wide range of consumer transactions—those involving the purchase or lease of goods or services for personal, family or household use. These include, among other things, transactions involving: banking, credit cards, home loans and other financial services; health care services; brokerage services; home construction and improvements; insurance; communications; and the purchase and lease of motor vehicles and other personal property.

Consumer Arbitration Agreements: Glossary of Terms

Consumer

Consumer refers to an individual who purchases or leases goods or services, or contracts to purchase or lease goods or services, intended primarily for personal, family or household use.

Provider

Provider refers to a seller or lessor of goods or services to Consumers for personal, family or household use.

ADR Process

Consumer Arbitration Agreements: Major Standards and Sources

The Reporter’s Comments accompanying these Principles cite a number of existing standards and sources relied upon by the Advisory Committee. The more frequently cited standards and sources are set forth below by their full title as well as the abbreviated title that appears in the Comments.

American Arbitration Association, Commercial Arbitration Rules, July 1, 1996 (AAA Commercial Rules)

American Arbitration Association, Construction Industry Dispute Resolution Procedures, Oct. 15, 1997 (AAA Construction Procedures)

Consumer Arbitration Agreements: Principles 1—15

PRINCIPLE 1. FUNDAMENTALLY-FAIR PROCESS

All parties are entitled to a fundamentally-fair ADR process. As embodiments of fundamental fairness, these Principles should be observed in structuring ADR Programs.

Reporter’s Comments

Consumer Arbitration Agreements: Signatories

A DUE PROCESS PROTOCOL FOR MEDIATION AND ARBITRATION OF CONSUMER DISPUTES

Dated: April 17, 1998

Some of the signatories to this Protocol were designated by their respective organizations, but the Protocol reflects their personal views and should not be construed as representing the policy of the designating organizations.

The Honorable Winslow Christian

Co-chair

Justice (Retired)

California Court of Appeal

William N. Miller

Consumer Arbitration Agreements: C.4 Consumer Debt Collection Arbitrations

Notice on Consumer Debt Collection Arbitrations

On October 19, 2010, the National Task Force on the Arbitration of Consumer Debt Collection Disputes released the Consumer Debt Collection Due Process Protocol Statement of Principles. That Protocol sets forth a number of important principles that need to be addressed and incorporated into consumer debt collection arbitration programs to help ensure that a fair and adequate arbitration process is made available to the parties.

Federal Deception Law: Listing of Provisions

15 U.S.C.

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§ 44. Definitions

§ 45. Unfair methods of competition unlawful; prevention by Commission

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§ 57a. Unfair or deceptive acts or practices rulemaking proceedings

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§ 57b. Civil actions for violations of rules and cease and desist orders respecting unfair or deceptive acts or practices

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Federal Deception Law: 15 U.S.C. § 44. Definitions

The words defined in this section shall have the following meaning when found in this subchapter, to wit:

“Commerce” means commerce among the several States or with foreign nations, or in any Territory of the United States or in the District of Columbia, or between any such Territory and another, or between any such Territory and any State or foreign nation, or between the District of Columbia and any State or Territory or foreign nation.

Federal Deception Law: Introduction

In 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act provided to the Consumer Financial Protection Bureau extensive authority to regulate consumer financial products, but excluded many automobile dealers from that authority. Instead, the Act gave the FTC streamlined rulemaking authority concerning automobile dealers. The statutory extracts infra detail those auto dealers excluded and provides for the streamlined rulemaking authority.

Federal Deception Law: 12 U.S.C. § 5519. Exclusion for auto dealers

(a) Sale, servicing, and leasing of motor vehicles excluded

Except as permitted in subsection (b), the Bureau may not exercise any rulemaking, supervisory, enforcement or any other authority, including any authority to order assessments, over a motor vehicle dealer that is predominantly engaged in the sale and servicing of motor vehicles, the leasing and servicing of motor vehicles, or both.

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(d) Federal Trade Commission authority

Federal Deception Law: 16 C.F.R. § 425.1. The rule

(a) In connection with the sale, offering for sale, or distribution of goods and merchandise in or affecting commerce, as “commerce” is defined in the Federal Trade Commission Act, it is an unfair or deceptive act or practice, for a seller in connection with the use of any negative option plan to fail to comply with the following requirements:

(1) Promotional material shall clearly and conspicuously disclose the material terms of the plan, including: