A recent study by the Consumer Financial Protection Bureau found that even though most Americans have at least one financial product — checking accounts, credit cards, loans, investment accounts — that use forced arbitration clauses to strip the account-holder of their right to sue, very few of us know about these restrictions or understand what they mean. And as the list we’ve compiled shows, it’s not just banks that are playing the “get out of jail free” card with arbitration.
Arbitration clauses allow companies to force customers with legal disputes out of the courtroom and into the process of private, often confidential, binding arbitration. Some clauses go a step further and say that there will, in most cases, be no actual hearing. Instead, the entire process can take place over the phone or through the exchange of documents.
The most troubling aspect of arbitration clauses is the fact they almost universally contain bans on class actions. So even if a company harms multiple customers in an identical way — say, through system-wide overcharges or by charging an entire class of customer a fee they did not owe — each single customer must enter into arbitration on their own. Research by the CFPB shows that very few individuals elect to go this route.
Arbitration rulings are final, even when the arbitrator made an error that would have changed the outcome. In some instances, the arbitrator doesn’t even give a reason for their decision — just a simple ruling in favor of one party.
Damages are also limited in arbitration, meaning wronged individuals will have a difficult time seeking legal representation, especially for cases that could be expensive to mount. Opponents of forced arbitration argue that class action bans effectively allow companies to break the law in situations where it would be too costly for a single consumer to prove otherwise.
So it’s worth noting that of the 87 companies we list below, every single one of them explicitly bans class actions.
Financial Services
Image courtesy of Jeff BriggsThe below lists are by no means comprehensive. This is just a round-up of some of the most prominent businesses using forced arbitration in the U.S.
Clicking on a company’s name in the lists below will, in most instances, take you to the relevant Consumer Clause Registry entry on ADR.org. For a handful of companies that are not currently in the ADR database, we’ve linked directly to relevant pages on their websites.
The CFPB is currently in the process of writing rules that could severely limit the use class action bans in financial products. Thus, this first list of companies are the ones that would be most directly affected by the proposed changes.
Of course, some members of Congress have recently introduced legislation that would prevent the CFPB from trying to enforce these rules, so their future is in question.
| Company | Class Action Ban? |
| Ally Financial | Yes |
| American Express | Yes |
| Barclays | Yes |
| Citibank | Yes |
| Dell Financial | Yes |
| Discover Bank | Yes |
| Discover Student Loans | Yes |
| Experian | Yes |
| Green Dot | Yes |
| H&R Block | Yes |
| JPMorgan Chase | Yes |
| Nissan Motor Acceptance | Yes |
| PayPal | Yes |
| PNC Bank | Yes |
| Regions Bank | Yes |
| Santander | Yes |
| SunTrust | Yes |
| Synchrony Bank | Yes |
| TD Bank | Yes |
| Toyota Motor Credit | Yes |
| TransUnion | Yes |
| USAA | Yes |
| U.S. Bank | Yes |
| Wells Fargo | Yes |
Telecom, Broadband & Broadcast
Image courtesy of Jason CookWhile financial services are the main target of the CFPB arbitration rules, it was actually a telephone company — AT&T — that struck the most decisive legal blow in arbitration’s favor.
In 2011, the Supreme Court ruled in AT&T Mobility v. Concepcion that forced arbitration clauses and class action bans were enforceable in consumer contracts, clearing the way for a slew of other companies to begin inserting these clauses into their terms of service. Thus, not a single major telecom or pay-TV provider has a user agreement that doesn’t include forced arbitration and a ban on class actions.
| Company | Class Action Ban? |
| A+E Television Networks | Yes |
| Assurant | Yes |
| AT&T | Yes |
| CenturyLink | Yes |
| Charter | Yes |
| Comcast | Yes |
| Consumer Cellular | Yes |
| Cox | Yes |
| DirecTV | Yes |
| Dish Network | Yes |
| Frontier | Yes |
| Gogo | Yes |
| Google Fiber | Yes |
| Hulu | Yes |
| MetroPCS | Yes |
| Netflix | Yes |
| SiriusXm | Yes |
| Sprint | Yes |
| Time Warner Cable | Yes |
| T-Mobile | Yes |
| U.S. Cellular | Yes |
| Verizon | Yes |
| Viacom | Yes |
| ViaSat | Yes |
Retail & Online
Image courtesy of elninaIf banks and cable companies can strip customers of their legal rights, so can retailers and online services, right?
Stream a video? There’s some arbitration for ya. Buy something from Amazon? More arbitration. Order a dang steak through the mail? Yup, that’s arbitration on a T-bone.
| Company | Class Action Ban? |
| 24 Hour Fitness | Yes |
| Aaron’s | Yes |
| Amazon | Yes |
| AOL | Yes |
| Booking.com | Yes |
| Care.com | Yes |
| CarMax | Yes |
| CVS | Yes |
| Dell | Yes |
| DraftKings | Yes |
| eBay | Yes |
| Expedia | Yes |
| FanDuel | Yes |
| Groupon | Yes |
| GrubHub | Yes |
| Hertz | Yes |
| The Honest Company | Yes |
| LegalZoom | Yes |
| Match.com | Yes |
| Microsoft | Yes |
| Nintendo | Yes |
| Omaha Steaks | Yes |
| Overstock.com | Yes |
| Raymour & Flanigan | Yes |
| Rent-A-Center | Yes |
| Snapchat | Yes |
| Sony Online Entertainment | Yes |
| Spokeo | Yes |
| Spotify | Yes |
| Starbucks | Yes |
| StubHub | Yes |
| Terminix | Yes |
| Ticketmaster | Yes |
| Walgreens | Yes |
| Yahoo! Sports Daily Fantasy | Yes |
Education
Image courtesy of David CrombieHad we made this list a year ago — or even a few months ago — it would have been much longer, with for-profit education giants like Corinthian Colleges Inc. and University of Phoenix forcing students into arbitration. However, CCI collapsed and Phoenix has ditched the arbitration clause in an effort to improve its image. Yet some of the biggest players in for-profit colleges remain:
| Company | Class Action Ban? |
| Education Corp. of America | Yes |
| ITT Educational | Yes |
| Kaplan Higher Education | Yes |
| Kaplan Inc | Yes |
by Chris Morran via Consumerist