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Quote of the Day - He that would make his own liberty secure must guard even his enemy from oppression; for if he violates this duty he establishes a precedent that will reach to himself. - Thomas Paine
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General Counsel Up In Arms Over Broad JAMS Prounouncement

MIPTC reported JAMS' new policy of not enforcing employment contracts that contained bans on class action suits.

Back in November.

So what's the news now? Apparently, steam has been building since JAMS' decision, and in-house corporate counsel (subscription required) are complaining louder and louder.

So much so that we can expect a legal challenge to the JAMS ban. As quoted in the Law.com article above, "John DeMarco, general counsel of Los Angeles-based Lowe Enterprises Inc., criticized JAMS'[ ] new policy at a November corporate counsel conference in San Francisco. Interviewed for th[e Law.com] article, DeMarco accused JAMS of trying to 'insert itself as a guardian of social policy' by interfering with the freedom to contract. Lowe doesn't include mandatory arbitration clauses in its contracts, but DeMarco said that if his company turned to arbitration in the future, it wouldn't use JAMS."

Consumer organizations, however, are pleased. Plaintiffs' lawyers are too, and they're trying to get other arbitration groups to adopt the same ban. That worries some General Counsel.

Money talks, and dollars walk. Corporate America will vote with dollars, and not only stop using JAMS, but also challenge JAMS' policy ban. Among other reasons, I would expect the challenge to be based on freedom of contract and due process.

General Counsel argue that JAMS arbitrators are no longer judges; they're arbitrators who decide each case on its merits, not issue pronouncements on broad legal principles.

That's an area that falls within the province of sitting judges.

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Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Monday, January 17, 2005 at 12:31 Comments Closed (0) |
 
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