Second Circuit Casts Doubt on the Continued Viability of Mandatory Arbitration Clauses and Class Action Waivers in Consumer Credit Card ContractsOn May 18, 2008 by Schnader
Financial services providers have more and more frequently over the last decade employed the use of mandatory arbitration clauses in agreements with customers. Generally, the clauses provide that the customer’s continued use of the credit card is tantamount to an agreement to accept the mandatory arbitration clause. Most agreements also provide that the arbitrator’s decision is final, and there is no right of appeal. Some also provide for a waiver of the ability to bring a class action.
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