National Arbitration Forums rubber-stamps a(nother) bogus claim
Okay, I don’t know for certain that any of the hundreds of arbitration awards NAF arbitrator Joseph Nardulli rendered were bogus, but it’s a good bet several of them were.
Kind of like the case of Irene Lieber, in which NAF awarded $46,000 to MBNA even though Lieber never even got a copy of the claim, or even a notice of who was “suing” her in arbitration. Moreover, the charges were made after her credit card was stolen. Lieber did everything right, challenging the debt collectors who contacted her and asking NAF to dismiss the suit or at least give her a copy of the claim.
Instead, NAF found her liable for $46,000. Never a company to be tripped up by facts, an MBNA spokesperson declared “We believe arbitration is an efficient and fair method of resolving disputes between our customers and the company,” and refused to comment on Lieber’s case.
It will be difficult, if not impossible, for Lieber to get the arbitration award set aside in state court, since, under the Federal Arbitration Act the only thing she may challenge in state court is the enforceability of the arbitration clause in the credit agreement unless she can show the arbitrator was biased. Getting the award overturned even on these facts is probably unlikely, even if Lieber could afford to bring such a case.
This is a pretty good reason to support the Arbitration Fairness Act, which would prohibit mandatory binding arbitration in consumer contracts unless both parties agreed to arbitrate after the dispute arises.
Actually, I’m not sure that she can’t get this set aside. It really depends on whether the lawyer challenged the existence of an arbitration agreement or not. If they did challenge the existence of the arbitration agreement, FAA laws state that the other party must then take this to court to compel arbitration. Per the Kansas state ruling that MBNA did not do so means that the arbitrator didn’t have jurisdiction to act on this case.
It’s no different than a Florida judge walking into a court in Washington and deciding to hear cases — she wouldn’t have jurisdiction.
All of this would be moot if we would just pass that bill. Then we could start repairing the damage two decades of bad Supreme Court rulings have caused.