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Arbitration and adhesion

One of the oddest arguments I see against pre-dispute arbitration clauses is that they are "contracts of adhesion"—because the provisions are non-negotiable, the argument goes, they are unconscionable. I recognize that many courts buy this argument, but it makes little logical sense. My contract with my cell-phone provider is non-negotiable in every way. But if I were to go to court and complain that my $89.99/month rate was unconscionable because it was a take-it-or-leave-it provision, I'd rightly be "laughed out of court." Oblix, Inc. v. Winiecki, 374 F. 3d 488, 491 (7th Cir. 2004) (anticipating AT&T Mobility v. Concepcion). So why does the similarly foolish anti-arbitration argument have so much traction? It seems to me to be a function of the judicial bias in favor of the lawyer cartel.

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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute

Katherine Lazarski
Press Officer,
Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.