Rape Case Highlights Arbitration Debate After she was raped in Iraq, allegedly by her co-workers, Jamie Lee Jones sought justice from her employer, Halliburton. But a mandatory arbitration policy prevents her from seeking recourse through courts. Without knowing it, many consumers and workers have signed away similar rights.
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Rape Case Highlights Arbitration Debate

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Rape Case Highlights Arbitration Debate


Rape Case Highlights Arbitration Debate

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[POST-BROADCAST CORRECTION: Our story cited research by Public Citizen supporting arguments for changing the system of mandatory arbitration. We should have pointed out that Public Citizen is an advocacy and lobbying group that opposes mandatory arbitration.]


This is ALL THINGS CONSIDERED from NPR News. I'm Michele Norris.


And I'm Melissa Block.

You may have done this dozens of times. With little more than a shrug, you sign a credit card or cell phone or auto loan contract without reading the fine print. No big deal unless there's a dispute, and that's when you find out you're committed to mandatory, binding arbitration. This out-of-court process for handling problems has been around for years, and it's kept thousands upon thousands of cases out of the court system. Businesses win the vast majority of arbitration cases, and that has consumer advocates and many members of Congress calling for changes.

NPR's Wade Goodwyn reports now, and we should warn you, this story begins with a description of a brutal assault that is not suitable for young listeners.

WADE GOODWYN: Jamie Leigh Jones was a 20-year-old Halliburton employee when in 2005, she was sent to work in Iraq. She'd been there just four days when she joined a small group of Halliburton firefighters outside her barracks at the end of the day. One of them gave Jones a drink. She took two sips, and that was the last thing she remembered.

Ms. JAMIE LEIGH JONES (Employee, Halliburton): I woke up inside the barracks. It was actually inside my barrack room, and when I woke up, that's when I noticed that I had been severely beaten, and I was actually naked.

GOODWYN: Jones had been vaginally and anally raped, repeatedly. By how many men, she's not sure.

Ms. JONES: I discovered that one man was brazen enough to still be in the room. The fact that apparently, he knew that he was beyond the reach of any type of jurisdiction, he was brazen enough to still be there.

GOODWYN: Jones was taken to the clinic, where a rape examination was done by the company doctor and the evidence given to Halliburton security guards. Jones' breasts were so badly mauled, she's permanently disfigured. In the four years since the attack, no indictments have been brought. Jamie Leigh Jones has decided that if she can't have her day in criminal court, she'll sue Halliburton and its former subsidiary, KBR, in civil court.

Ms. JONES: I want corporate accountability. I was so brutalized that I'm going to have to remember this for the rest of my life, and Halliburton is so uncompassionate that they even let the men work there still, after I was sent home.

GOODWYN: The company denies any liability in the attack. And it argues that any dispute, even one involving charges of rape, must go to arbitration because that's what it stipulates on her employment contract. So Jones is going to court seeking the right to sue, and Jones is fighting on other fronts, too. She's become one of the nation's leading advocates for arbitration change, testifying on Capitol Hill.

Ms. JONES: Good afternoon. I am standing before you to share with you a personal tragedy. I do this to bring awareness to legislation, but…

GOODWYN: If Jones' case is remarkable, the fact that arbitration is involved is not. In the last 20 years, it has become a dominant feature in the legal relationship between American corporations and their customers. Though you may not be aware if you use credit cards, or have a cell phone contract, if you bought a home from a builder or put your mother or father in a nursing home, you have likely signed away your right to be heard in court if there's a problem. It's called predispute, mandatory, binding arbitration.

Mr. DAVID ARKUSH (Public Citizen): In the fine print of those contracts is a provision that says that they can never sue the company if they have any kind of dispute. It doesn't even matter if the company just, you know, outright steals money from their account. They still can't sue over it. Instead, they have to go to a private, secretive tribunal chosen by the company.

GOODWYN: Standing outside a congressional subcommittee hearing room, where he just testified, Public Citizen's David Arkush is one of the country's leading researchers on arbitration. It is not easy to find information. Arbitration is a closed, private process, often with little or no written record. But one state, California, changed its law to require that arbitration rulings - the results, at least - be publicly recorded. And in the largest arbitration study ever done, Arkush and his staff ploughed through 34,000 California arbitrations.

Mr. ARKUSH: Overall, consumers lost 94 percent of the time.

GOODWYN: While the arbitration industry disputes that number, there is no disagreement that corporations win more of the time. The disagreement is about whether this is evidence of bias, or a reflection that corporations bring stronger cases. Mike Kelly is a spokesperson for the National Arbitration Forum, one of the country's largest arbitration firms.

Mr. MIKE KELLY (Spokesperson, National Arbitration Forum): You're not going to bring a case that you think you're going to lose. Frankly, you're not going to bring a case you believe you have a chance to lose.

GOODWYN: Kelly says the results would still be lopsided even if these same cases went to court instead of arbitration. And Kelly defends his arbitrators, which the NAF calls neutrals, as men and women of integrity.

Mr. KELLY: In order for there to be bias, there has to be a neutral at the end of the process, who is willing to bend - bend in a way that is contrary to their ethics. And so, what you're really doing is you're taking a shot at all those individual neutrals out there who are handling these cases.

Professor ELIZABETH BARTHOLET (Law, Harvard University): I've been doing arbitration for more than two decades, but with the NAF, I only did it for a couple of years.

GOODWYN: Elizabeth Bartholet is a professor of law at Harvard University and a part-time arbitrator. The first 19 cases she arbitrated for the National Arbitration Forum were all credit card cases, and she ruled each time for the credit card company.

Prof. BARTHOLET: Then I had a case in which I did decide against the credit card company.

GOODWYN: In this case, Bartholet found the credit card company had defrauded the customer and ruined his credit. She awarded him $48,000. And with that, her brief career as an NAF arbitrator was effectively over. She was stricken from her remaining cases.

Prof. BARTHOLET: I called the NAF and spoke to the case manager, and she agreed that it was likely the reason I was being removed was because I had ruled in this one case against the credit card company.

GOODWYN: The NAF says nothing improper was done, that companies and consumers alike are allowed to strike an arbitrator from a case. But Bartholet says arbitrators know full well that if they rule against corporations too often, their income will dry up. She describes how the process works.

Prof. BARTHOLET: NAF arbitrators are given a form where every line is filled out in terms of the amount that it suggested that you rule. And so all you need to do is fill in on the line to the right the exact, same number. And then at the bottom, total it up, and they fill in the attorney's fees number. And there's no indication that you should write even a one-sentence opinion.

GOODWYN: Public interest advocates say they don't want to make arbitration go away; they just want a more level playing field. The Arbitration Fairness Act now before Congress would give consumers and employees the choice of going to arbitration after a dispute has occurred. But Lisa Rickard, with the U.S. Chamber of Commerce, argues that making arbitration voluntary will make it extinct and furthermore, will clog the courts with needless litigation.

Ms. LISA RICKARD (U.S. Chamber of Commerce): It really is human nature. When people have an argument, they want to fight it out. And the best place to fight it out is in court.

GOODWYN: Even in a Congress now dominated by Democrats, arbitration reformers say they are unsure of their chances. The Arbitration Fairness Act has been introduced in both the House and Senate, and hearings are expected after the summer break.

Wade Goodwyn, NPR News, Dallas.

(Soundbite of music)

BLOCK: At our Web site, you can find a lot of resources to learn more about the debate over arbitration. That's at npr.org.

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