Leading the Fight Against Wrongful Arbitration

San Francisco City Attorneys File Suit Against the NAF

nospam@example.com (Steve) — Tue, 08 Apr 2008 10:53:55 -0700

Widely reported, the City of San Francisco's City Attorney's office has filed suit against the NAF for unfair and unlawful business practices.

CLICK HERE FOR LEGAL SUIT IN PDF FORMAT

The response by the National Arbitration Forum is nothing short of astounding. Actions speak louder than words, and the NAF responded to the suit by finally filing their 1281.96 reports from Q2, Q3 and Q4 of 2007.

Followers of this sham tale will recall that after Public Citizen released their 75-odd page report alleging much of the same as the suit filed by San Francisco, the NAF stopped filing 1281.96 reports. This is a pattern of behavior; they did much the same after the Corbett Bill was initially passed. (they refused to file until suit was filed....looks pretty familiar....)

Wrongful Arbitration is the Hidden Cost of Unregulated Social Policy Calling for Outsourcing of Civil Justice

nospam@example.com (Steve) — Sun, 02 Mar 2008 10:12:49 -0800

It has been some months since the initial study put out by Public Citizen. The report was spurred on, yet without any groundswell of public support, civil arbitration continues unabated, and unchallenged. Arbitrations performed by the National Arbitration Forum on behalf of major credit card issuers such as MBNA Card Services, and FIA Card Services continues unregulated nationwide. The only state that has successfully enacted legislation remotely like regulation is California, with their Corbett Bill-driven regulatory attempt of so-called 1281.96 reports.

It seems even this has no teeth. Since the Public Citizen report, the NAF has not posted a single additional quarterly report, as mandated by law.

How much longer will it be before all the other arbitration services decide they also, have no need to comply with the law?

Should the Corbett Bill be replicated to other states? (or Where There's Smoke There's Fire)

nospam@example.com (Steve) — Mon, 13 Aug 2007 18:26:32 -0700

The Corbett Bill became CCP 1281.96 - the California Code of Civil Procedure that mandates companies such as the National Arbitration Forum, provide summaries of their arbitration activities.

Give the vast amounts of negativity (just google them!) surrounding the National Arbitration Forum, it just might be a good idea.

"The American Jury System is Dying"

nospam@example.com (Steve) — Sun, 05 Aug 2007 11:04:02 -0700

U.S. District Judge William G. Young delivered this speech to the Florida Bar Association, stating:

Arbitration is in play. If you trade on the New York stock exchange, have long-distance telephone service, use cell phones, or work for Circuit City or other major employers, he said, you have already given up your right to trial by jury.

“It will never go entirely, but it is already marginalized. It is not at the center of our political discourse. How is this possible, with our Constitution and every one of the 50 state constitutions guaranteeing the right to trial by jury? The general answer is that we do not care.”

When a member of the judiciary stands up and makes this kind of statement, something is going awry; in the case of MBNA and FIA Card Services, these have led to Wrongful Arbitration actions.

Do the Credit Industries Mold Social Policy for Their Own Greed?

nospam@example.com (Steve) — Sat, 04 Aug 2007 09:50:08 -0700

Has the increasing willingness AND ABILITY of the credit industry to influence legislation molded social polices in America to the detriment of American Consumers?

The Credit industry in America wields tremendous powers over economic facets of society. Consumer credit enables consumers to drive industry output, itself dependent upon the financing markets to be able to produce the demanded output. Consumer households, depending on how you count the numbers, average $2,250 to $10,000 in credit card debt, all across the county.

See for example the Federal Reserve Board Statistical Releases, which state in May 2007, the revolving credit held by American households neared $900 Billion. This translates to over $7,000 per household.

The profitability of credit products, however, has not yielded enough for these businesses. The highest credit card profits are late fees, over limit fees, expanded interest charges, and annual fees. The credit card holder that pays off the bill every month is simply not profitable. The CREDIT CARD industry convinced Congress to pass the "Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, after massive lobbying (seven prior attempts failed.)

In this University of Iowa study, it's pointed out that while the Act was sold as preventing 'immoral' American families seeking protections under bankruptcy, in fact Credit Card companies seek these families out AFTER BANKRUPTCY:

Rather than eschewing them as profligates, the lending industry treats families who seek bankruptcy relief as a lucrative
source for profits. The widespread marketing to families after bankruptcy provides a powerful example of the credit industry’s willingness and ability to profit from financially distressed and vulnerable consumers. The law shapes creditors’ marketing and lending decisions to recently bankrupt families, but this effect was hidden during the past decade of bankruptcy reform.

What's Happened to A.B. 2574 and CCCP Section 1281.92?

nospam@example.com (Steve) — Thu, 02 Aug 2007 22:30:53 -0700

Assembly Bill 2574 led to the California Code of Civil Procedure Section 1281.92; this became California law January 1, 2003. It became law with a few other Assembly Bills which also added codifications regarding arbitrations between consumers and big business.

Four and a half years later, it is worth taking a look at what has happened.

The Bill Topic is defined as "Conflicts of Interest" and reviewing the April 23, 2002 Hearing summary reveals these findings in the California capital:

KEY ISSUES : SHOULD PRIVATE JUDGING COMPANIES BE TREATED
CONSISTENTLY WITH JUDGES, ARBITRATORS AND OTHER PERSONS
PERFORMING PUBLIC FUNCTIONS IN KEEPING AN ARM'S-LENGTH DISTANCE
FROM PARTIES TO CONSUMER ARBITRATIONS?

It's obvious from the passage of this bill (30 ayes and 2 noes) that the California legislature deemed the answer a resounding "YES".

Consistently with the other bills the Committee is hearing
regarding consumer arbitration, this bill would address
egregious conflict of interest problems in consumer arbitrations
by prohibiting private judging companies from administering the
consumer arbitrations of parties with whom they have significant
financial investments and other financial relationships.

The legislature clearly recognized the justice may very well be sold.....
Continue reading "What's Happened to A.B. 2574 and CCCP Section 1281.92?"

California CCP 1281.96 : Are the filings by the National Arbitration Forum Disingenuous?

nospam@example.com (Steve) — Wed, 01 Aug 2007 12:13:47 -0700

California Code of Civil Procedure 1281.96 reads:

1281.96. (a) Except as provided in paragraph (2) of subdivision
(b), any private arbitration company that administers or is otherwise
involved in, a consumer arbitration, shall collect, publish at least
quarterly, and make available to the public in a computer-searchable
format, which shall be accessible at the Internet Web site of the
private arbitration company, if any, and on paper upon request, all
of the following information regarding each consumer arbitration
within the preceding five years:
(1) The name of the nonconsumer party, if the nonconsumer party is
a corporation or other business entity.
(2) The type of dispute involved, including goods, banking,
insurance, health care, employment, and, if it involves employment,
the amount of the employee's annual wage divided into the following
ranges: less than one hundred thousand dollars ($100,000), one
hundred thousand dollars ($100,000) to two hundred fifty thousand
dollars ($250,000), inclusive, and over two hundred fifty thousand
dollars ($250,000).
(3) Whether the consumer or nonconsumer party was the prevailing
party.
(4) On how many occasions, if any, the nonconsumer party has
previously been a party in an arbitration or mediation administered
by the private arbitration company.
(5) Whether the consumer party was represented by an attorney.
(6) The date the private arbitration company received the demand
for arbitration, the date the arbitrator was appointed, and the date
of disposition by the arbitrator or private arbitration company.
(7) The type of disposition of the dispute, if known, including
withdrawal, abandonment, settlement, award after hearing, award
without hearing, default, or dismissal without hearing.
(8) The amount of the claim, the amount of the award, and any
other relief granted, if any.
(9) The name of the arbitrator, his or her total fee for the case,
and the percentage of the arbitrator's fee allocated to each party.

(b) (1) If the information required by subdivision (a) is provided
by the private arbitration company in a computer-searchable format
at the company's Internet Web site and may be downloaded without any
fee, the company may charge the actual cost of copying to any person
who requests the information on paper. If the information required
by subdivision (a) is not accessible by the Internet, the company
shall provide that information without charge to any person who
requests the information on paper.
(2) Notwithstanding paragraph (1), a private arbitration company
that receives funding pursuant to Chapter 8 (commencing with Section
465) of Division 1 of the Business and Professions Code, and that
administers or conducts fewer than 50 consumer arbitrations per year
may collect and publish the information required by subdivision (a)
semiannually, provide the information only on paper, and charge the
actual cost of copying.
(c) This section shall apply to any consumer arbitration commenced
on or after January 1, 2003.
(d) No private arbitration company shall have any liability for
collecting, publishing, or distributing the information required by
this section.

Click here to read the section in it's entirety.

In the quarterly filings made by the National Arbitration Forum, we note the distinct "Unknown" value provided by them in the "Individual Represented by Counsel" category. In Q1 2007, out of 3,901 cases that the National Arbitration Forum reported they decided, they state that in 3,764 it was "Unknown" whether the Consumer had counsel.

In 137 cases, they reported "Y".

In Q1 2007, the National Arbitration Forum reported 3.5% of the total cases they decided in California involved consumers that WERE represented by counsel. In 96.5% of the cases, this fact is "Unknown."

We suggest the California legislature dis-allow the entry of "Unknown" in this category. "No" is very different than "Unknown" and the public reporting and spin evaluation of this data is against the public interest.

Is Justice for Sale at the National Arbitration Forum?

nospam@example.com (Steve) — Tue, 31 Jul 2007 15:25:30 -0700

It's very difficult to pierce the National Arbitration Forum's veil of secrecy. It does not come up in a search of publicly-held or traded entities, nor does it come off as a non-profit organization. This leads to only one conclusion: the National Arbitration Forum is a for-profit privately held entity.

The National Arbitration Forum claims to handle "over 50,000" cases per year. Who else handles this many cases per year?

Public Defenders Office - Palm Beach County handles this many cases per year
San Bernadino's Public Defender office also handles this many per year.. (in the case of San Bernadino County, the public defenders office handles 75% OR MORE of the total criminal cases in the county!)
Each of the 12 regional Circuit Courts handles 45-50,000 cases per year.
The US Tax Court handles approximately 45,000 cases per year.

Is the National Arbitration Forum a privatization of the legal system? or more dangerously, is justice 'For Sale' at the National Arbitration Forum? Coming soon - an analysis of the numbers of cases in California - handled by the National Arbitration Forum. Who decided, who won, and who lost.

Then you can decide for yourself if justice is for sale at the National Arbitration Forum.

Schiano v MBNA, Wolpoff & Abramson, and the National Arbitration Forum

nospam@example.com (Steve) — Fri, 27 Jul 2007 11:58:05 -0700

In this fascinating case, we get a rare published look at the potential iceberg of fraudulent Wrongful Arbitration.

The Schiano's have filed a case before the United States Supreme Court, over issues relating to a PAID AND SETTLED ARBITRATION BASED AWARD. In their filing, the Schiano's note that the payment of $30,000 was not received by MBNA, the dlinquent account remains on their credit report, and their credit remains ruined.

$30,000. Who got the money if MBNA didn't?

The story (read it here) also contains specific elements of the process of converting the National Arbitration Forums award to MBNA, into LIQUID funds that were then collected during a refinance, with a mortgage brokerage recommended by the law firm collectors.

Is this a pattern of behavior? Do you have similar circumstances? Let us know now.

Did Your County Court Grant FIA Card Services Their Motion to Compel Arbitration?

nospam@example.com (Steve) — Wed, 25 Jul 2007 13:13:42 -0700

California's Ninth Circuit Vacates District Courts Order Compelling Arbitration

A favorite tactic of FIA Card Services (formerly MBNA Bank) is to put a stuffer in the envelope in your monthly statement. In these, they change the terms of the agreement. They don't ask you to agree to the change; nevertheless they claim the changed terms are now part of that initial application that you signed.

Needless to say, MBNA - FIA and their attorneys Wolpoff & Abramson, Gordon & Wong, Petanaude & Felix and others rely upon these papers added to your monthly statement to walk you into potentially wrongful arbitration, and convert your unsecured debt to an secured debt Abstract of Judgment, and the possible seizure by the County Sheriff of your property including contents of your bank accounts!

The class action case revolved around a dispute by a long distance provider (Talk America) and customers (Douglas was the class action representative. Of course the telephone company pushed for arbitration. The arbitration clause was added into the Terms and Conditions section of their web site, some time after customers were signed up. The District Court agreed with Talk America and order Arbitration. Douglas appealed.

In vacating the order to Arbitrate, the decision by Circuit Judges Kozinski, Gould and Callahan points out:

Parties to a contract have no obligation to check the terms on a periodic basis to learn whether they have been changed by the other side.1 Indeed, a party can’t unilaterally change the terms of a contract; it must obtain the other party’s consent before doing so. Union Pac. R.R. v. Chi., Milwaukee, St. Paul & Pac. R.R., 549 page 5 F.2d 114, 118 (9th Cir. 1976).

and further

...California Court of Appeal has held that a revised contract containing an arbitration clause is unenforceable against existing customers, even when they are given notice by mail. Badie v. Bank of Am., 67 Cal. App. 4th 779, 801 (Ct. App. 1998).

Do you remember agreeing to Arbitration when you got your MBNA or FIA credit card account? As these Judges note, one party cannot change the agreement without further acceptance by the other.

Federal Government Funded $1M to Patenaude & Felix

nospam@example.com (Steve) — Tue, 24 Jul 2007 11:41:39 -0700

We have followed cases where the National Arbitration Forum claim form for MBNA America Bank is claimed "c/o Wolpoff & Abramson, LLP'. That same case is then shifted to Patenaude & Felix, for filing in your county Courthouse as a Petition to Confirm Arbitration --- once the award is made. (If this is happening to you in Orange County or Los Angeles County, or anywhere in Southern California, contact us now.)

Wolpoff and Abramson is a routine replacement for Patenaude & Felix, when the court goings get 'tough' (like when things get contested!)

I wonder if Wolpoff is selling arbitration awards to Patenaude & Felix for filing? The reason I ask that is as soon as rough waters are encountered, Patenaude throws the case back to Wolpoff & Abramson, who does the showing up at court.

Wolpoff and Abramson must definitely be really well heeled, or connected. I've always wondered where they got their seed money.

As far as Patenaude and Felix are concerned, it appears they may have gotten some of their seed money from the Federal Government. According to OMB Watch at FedSpending.Org, the SBA gave Patenaude & Felix nearly a million dollars

TO ASSIST SMALL BUSINESS CONCERNS BY PROVIDING LONG TERM FINANCING THROUGH THE SALE OF DEBENTURES TO THE PRIVATE SECTOR.

What does that mean? According to InvestorWords.com, "DEBENTURE"

Unsecured debt backed only by the integrity of the borrower, not by collateral, and documented by an agreement called an indenture. One example is an unsecured bond.

Continue reading "Federal Government Funded $1M to Patenaude & Felix"

"Phantom Arbitration"masquerades as Mandatory Arbitration Clause

nospam@example.com (Steve) — Mon, 23 Jul 2007 09:12:00 -0700

According to the Christian Science Monitor,

" the 10 most frequently used arbitrators – who decided almost 60 percent of the cases heard – decided in favor of the consumer only 1.6 percent of the time, while arbitrators who decided three or fewer cases decided for the consumer 38 percent of the time."

Their writeup slams especially the National Arbitration Forum, as especially egregious in the credit-card bias.

What the article fails to mention is the use of Arbiters such as the National Arbitration Forum, when THERE IS NO LEGAL MANDATORY ARBITRATION CLAUSE.

We assert there is a vast well of Arbitration 'cases' initiated and paid for by MBNA Card Services and FIA Card Services and other credit card issuers, where consumers (you) are led down an Arbitration path, in violation of laws. Once leaving the arbiter's office, this illegal coercion and conversion of your rights, leads directly to your County Courthouse. Once at the County Courthouse, FIA / MBNA's law firm collection agencies petition the court with a PETITION TO CONFIRM ARBITRATION AWARD, usually in front of a creditor-friendly trial judge. Needless to say, the resulting illegal Award and Judgment happens all too commonly.

Is Arbitration being asserted - requested - or ramrodded by the credit card issuer FIA Card Services and their collection-mill attorneys - including Patenaude and Felix, Wolfpoff and Abramson, Gordon and Wong, and others against you?

Contact us now to fight back on their Wrongful Arbitration acts.

Ignorance is NOT Bliss When it Comes to Wrongful Arbitration

nospam@example.com (Steve) — Sat, 21 Jul 2007 19:34:09 -0700

In today's Los Angeles Times, one of their reporters wrote the story of his journey covering RELIGION in Orange County for the newpaper.

In it he wrote:

"SOME of the nation's most powerful pastors — including Billy Graham, Robert H. Schuller and Greg Laurie — appear on the Trinity Broadcasting Network, benefiting from TBN's worldwide reach while looking past the network's reliance on the "prosperity gospel" to fuel its growth.

TBN's creed is that if viewers send money to the network, God will repay them with great riches and good health. Even people deeply in debt are encouraged to put donations on credit cards.

"If you have been healed or saved or blessed through TBN and have not contributed … you are robbing God and will lose your reward in heaven," Paul Crouch, co-founder of the Orange County-based network, once told viewers. Meanwhile, Crouch and his wife, Jan, live like tycoons."

Published July 21, 2007 in the Los Angeles Times

Let's just hope (and pray) that these practices promulgated by the pastors do NOT turn YOU into victims of WRONGFUL ARBITRATION at the hands of the credit card companies and their debt collection agencies and law firms.

If you are being victimized by Wrongful Arbitration, contact us now.

The Arbitration Fairness Act of 2007

nospam@example.com (Steve) — Thu, 12 Jul 2007 11:28:00 -0700

In an effort to ban MANDATORY BINDING ARBITRATION clauses in consumer disputes and other areas, Senator Russ Feingold (D-WI) and Representative Hank Johnson (D-GA) are introducing The Arbitration Fairness Act of 2007.

This legislation is supported by many consumer rights organizations. Significant areas of impact will be in:

Consumer credit card accounts - where the credit card issuer strips the account holder of their right to a jury trial by using the arbitration clause

Employment law -

Medical providers - healthcare providers -

Investors

Wrongful Arbitration Converts Unsecured Debt to Secured Debt

nospam@example.com (Steve) — Sat, 23 Jun 2007 07:07:00 -0700

STRIPPING YOU OF LEGAL RIGHTS ALONG THE WAY

There are two kinds of debt - secured and unsecured. A secured debt is debt tied an asset, such as a car or home. The creditor-debtor agreement specifically allows the creditor to go through certain steps to get the asset, that car, or that home, if the debt goes unpaid or past due. Unsecured debt is not specifically connected to a certain asset. These debts might be medical bills, personal loans, and balances on utility bills. Credit card accounts are unsecured debt.

You can be sure if you are delinquent on your car or home mortgage payments, foreclosure is eventually 100% going to happen.

Unsecured debt holders must decide to take many steps to seize assets or income from you. They may easily decide not to do anything at all; legally, federal regulation make credit card companies charged these losses off their balance sheets in regular reporting periods.

When an UNSECURED CREDITOR utilizes WRONGFUL ARBITRATION as a replacement for some of those steps, they are stripping you of legal rights. A simple and effective method employed by the companies is to claim the amount you owe them at the National Arbitration Forum, notorious for rubber stamping thousand of these by MBNA and FIA Card Services. The next step is to present your local County Court with a "Petition to Confirm Arbitration Award", quite likely with an Judge that may be an NAF arbitrator, which continues the rubber stamp with a Notice of Award, a Money Judgment.

BINGO! The unsecured creditor now has a Money Judgment he can file with the clerk of the county and he is now VERY secured. You probably won't refinance a home without satisfying their potentially illegally-gotten Money Judgment. If you have bank accounts, they have every right to tell the Sheriff of the County to Levy - and TAKE YOUR MONEY.

If you have had money and assets seized, or are threatened with seizure, and you think that these actions are based on a WRONGFUL ARBITRATION action, contact us now.