Stacked Deck: A Statistical Analysis of Forced Arbitration


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Published: May 31, 2009

"Stacked Deck" is a statistical analysis of outcomes in forced arbitration, also called mandatory arbitration or binding mandatory arbitration, that finds:

  • Individual arbitrators have a strong incentive to favor the firms that provide them with repeat business over an individual consumer they may never see again.
  • Companies win a favorable ruling in arbitration far more often than consumers.
  • Companies involved in the most arbitration cases--and therefore in creating the most business for arbitrators--consistently receive more favorable rulings than firms involved in fewer cases.

Almost all credit card, auto, and small consumer product contracts contain a hidden forced arbitration clause instead of offering consumers their day in court before a jury of their peers.  

CRL recommends that borrowers know their rights, opt-out up front of an arbitration clause if possible, and realize that the arbitration clause may not always be binding.