Senior Counsel Alan S. Kaplinsky and Mark J. Levin from Ballard Spahr, along with David Sherwyn, a Professor of Law at Cornell University’s School of Hotel Administration, have submitted extensive comments to the Consumer Financial Protection Bureau (CFPB) in opposition to the recent petition presented by consumer advocates. The petition urged the CFPB to take up rulemaking that would prevent the use of pre-dispute arbitration clauses in consumer contracts, advocating for arbitration clauses that would instead provide consumers the choice between…
The attorneys and the law professor are countering the demands of consumer advocates intending to alter the mechanism of resolving consumer disputes. Pre-dispute arbitration clauses, often included in consumer contracts, set the terms for the resolution of potential conflicts even before they arise. Consumer advocates, however, consider these clauses limiting consumers ability to effectively pursue their rights, prompting the call for rulemaking to modify their use.
Given the ongoing debate regarding arbitration agreements and their role in protecting both businesses and consumer interests, this development underscores the significance of legal opinions, such as those expressed by the team of Kaplinsky, Levin and Sherwyn, in shaping policy. This event will certainly be keenly followed by legal professionals, especially those dealing with consumer affairs and contract law.
The full information regarding the opposition submitted by Ballard Spahr attorneys and Professor Sherwyn can be found on JD Supra.