NYT Hammers Consumer Arbitration Clauses

In the immediate wake of another Supreme Court decision upholding the legality of class-action waivers in arbitration agreements, the New York Times has come out with an investigative feature, one of a series, that is highly critical of the practice. A piece back in October traced the origins of what the Times calls “a far-reaching power play orchestrated by American corporations.” In the latest installment, the writers look at what they describe as a particularly audacious version of the practice. It’s carried out by companies that buy debt that”banks have given up on” and then become  aggressive collectors, suing often clueless debtors who then discover that if they want to go to court themselves, individually or as participants in a class action, they are bound by the original loan agreement and a clause requiring them to arbitrate their own individual case. Meanwhile, according to the Times, the debt buyers have flooded the courts with collection cases, in 2014 filing more than 67,000 in New York state alone.