“In a remarkably short period of time, the United States Supreme Court has dramatically rewritten the law governing arbitration. The Federal Arbitration Act of 1925 (FAA) permits non-judges to settle business disputes. It was passed as a reaction to many judges’ hostility toward arbitration agreements. The FAA states that arbitration agreements are ‘valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.’ In other words, Congress merely meant to place arbitration agreements ‘upon the same footing as other contracts.’ The underlying assumption was that these agreements would exist in negotiated contracts between parties with relatively equal bargaining power. In the 1980s, however, the Supreme Court began radically expanding the scope of the arbitration law, applying it to a plethora of fine print consumer and employment contracts the FAA’s drafters never could have imagined. The drafter also intended for the statute not to apply to employment contracts, though the Supreme Court has largely ignored this exception.”

Source: Alliance for Justice. “Arbitration Activism: How the Corporate Court Helps Business Evade Our Civil Justice System.” pg. 6. 2013.

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