Law Journal Article: “Civil Jury Trials R.I.P.? Can it Actually Happen in America?” and the Federal Arbitration Act

During this Fourth of July holiday weekend, our good friend Don Philbin stumbled across “Civil Jury Trials R.I.P.? Can it Actually Happen in America?” 40 St. Mary’s L.J. 795 written by the Honorable W. Royal Furgeson, Jr. In the article, Judge Furgeson discusses the Arbitration Fairness Act of 2007, which is analogous to the Arbitration Fairness Act of 2009 (previously blogged here) currently considered in the U.S. Congress. If enacted, the bill would amend the Federal Arbitration Act to ban pre-dispute arbitration of employee, consumer, franchise, and civil right claims. (Senate version: S. 931 and Status; House version: H.R. 1020 and Status)

Judge Furgeson proposes to amend the Federal Arbitration Act:

Why not amend the FAA so that all mandatory arbitration agreements are unenforceable if entered into before the actual dispute arises, except for those in collective bargaining agreements and international contracts? There is a long history behind the development of collective bargaining agreements in labor contracts and both labor and management have put processes in place that facilitate in special ways the objectives of both parties. Such arrangements should be honored. Likewise, the globalization of the marketplace has created demands for dispute resolution in the international arena that are best served by mandatory arbitration agreements. To not support such agreements would place American companies at a disadvantage and would be a mistake. For all other dealings between parties in the United States, parties should be allowed to agree to arbitration only after the dispute arises.

Another amendment would also be in order. The parties to arbitration should be able to agree that their arbitrator’s decision can be reviewed for legal error. The present state of the law forecloses such an agreement, as the Supreme Court has recently announced, but such a review would be a positive development and should be considered by amendment to the FAA.

The article also discusses the use of mediation in the American system:

It also should be noted that non-binding mediation is an entirely different kind of animal and is a wonderful addendum to our justice system. Even in yesteryear when juries flourished, over 90% of cases settled. Before mediation, they settled without the parties having any forum to tell their story. Mediation facilitates this important principle of due process, where everyone gets to tell their story before an impartial and fair decision maker. Such mediation, however, does not have the defects of binding arbitration outlined above. If the matter is not resolved in mediation, the right to jury is preserved. And judicial review is also preserved. Now, because of mediation, settlements have the added benefit of giving people their day to be heard. This makes settlements more meaningful and more helpful in resolving disputes.

Any thoughts?

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