When Companies Run the Courts: How Forced Arbitration Became America’s Secret Justice System

In this hard-hitting exposé, former federal prosecutor Ballou (Plunder) probes the injustices of mandatory arbitration clauses. Lurking in the fine print of employment and customer agreements, these clauses force victims of corporate misdeeds—from credit card holders dinged for bogus charges to employees of American Apparel who made sexual assault allegations against its CEO—into private arbitration instead of lawsuits in regular courts. These “secret courts” are inherently corrupt, according to Ballou, who notes that private arbitration firms get lucrative repeat business if they rule in favor of corporate defendants, which they usually do. In addition to offering no right of appeal, forced arbitration also, he argues, lets companies pilfer a little money from a lot of people with impunity—think rising Ticketmaster fees—by banning consumers from joining class action lawsuits. Ballou traces the problem to decades of legally dicey and ethically suspect Supreme Court rulings from both conservative justices—Antonin Scalia got free luxury hunting trips from businessmen who benefited from his proarbitration opinions, Ballou reports—and liberals like Ruth Bader Ginsburg, who voided a Montana disclosure law that required agreements to highlight arbitration clauses up front. Ballou unpacks labyrinthine legal reasoning in clear, down-to-earth prose that spotlights the human cost of “a cruel and lawless system.” It’s a forceful indictment of one of America’s most unjust and problematic legal frameworks. (May)