Civil Justice

May 3, 2024

The Chamber’s Arbitrary Takes on Arbitration

Zach Brown Civil Justice, Consumer Protection 0

The United States Chamber of Commerce (Chamber) has long been a proponent of arbitration as a pro-corporate means to resolve disputes outside of traditional court systems. Time after time, even in the face of the common knowledge that consumers are being harmed by the arbitration process, the Chamber repeatedly commends the “fairness” of arbitration. For example, on its website, the Chamber boldly claims, “arbitration is a fairer, faster, and less expensive way for workers and consumers to resolve conflicts.”

Now hold that thought, Chamber.

Conveniently enough, the Chamber’s strong pro-arbitration stance takes a rather sharp turn when it comes to “mass arbitration” – a legal mechanism that allows lawyers to bring multiple arbitration claims for different consumers and make it more feasible for small dollar harms to be pursued when class action lawsuits are not available because of a mandatory arbitration agreement. Can you say plot twist?

The Chamber’s opposition to mass arbitration hinges on what it claims to be unfairness and the dilution of individual rights. It argues that grouping claims together could lead to unjust outcomes and undermine the sanctity of arbitration. The Chamber even goes so far as to call mass arbitration blackmail – because to it, allowing consumers to band together to seek vindication of their rights is abusive.

The Chamber’s narrative sidesteps the myriad benefits of mass arbitration to consumers. For starters, one of the most significant advantages of mass arbitration is its ability to address wrongdoing that affected numerous consumers or numerous workers. Take, for example, data breaches that compromised personal information on a massive scale. To pursue an individual claim against the company in arbitration would be too costly to be practical for small-money claims. Mass arbitration allows lawyers for these consumers to use economies of scale that make it feasible to achieve redress for consumers’ common grievances. The ability to do so in arbitration is particularly important because, where the company has imposed a forced arbitration requirement on its customers, the option of bringing a class action is generally not available.

While the corporate backlash against mass arbitration seems hypocritical, it could have a beneficial effect by spurring corporations to abandon the practice of imposing, before any dispute has arisen, forced arbitration provisions on workers and consumers. For example, Amazon faced mass arbitration in 2021, when roughly 75,000 customers submitted claims in arbitration alleging that Amazon devices were listening to them without their consent. Faced tens of millions of dollars in fees for arbitrators to hear each case individually, in accordance with the mandatory arbitration clauses imposed on its customers, Amazon announced that it was dropping arbitration requirements from its customer agreements.

The Chamber’s criticism of mass arbitration reeks of a double standard. The organization preaches arbitration as a beacon of fairness, yet complains when consumers embrace arbitration.

Talk about unfair.

who is McConnell protecting: essential workers or essential donors?

July 16, 2020

Public Citizen Issue Brief Documents Chamber’s False Cries That the Sky is Falling

Susan Harley Civil Justice, Consumer Protection, Health Care, Uncategorized, Workers' Rights 0

By Nick Papazyan, Congress Watch Legal Intern

The coronavirus pandemic has claimed more American lives than all of the wars since the Korean War– combined. The virus is raging across the country, and we haven’t even begun what scientists call the “second wave.” At a time when we should be prioritizing public health and safety, Senate Majority Leader Mitch McConnell and the U.S. Chamber of Commerce (Chamber) are seeking to immunize businesses from coronavirus-related lawsuits. On July 16, Public Citizen published an issue brief that exposes how the Chamber opportunistically uses moments of national emergency, such as a pandemic, to advance its anti-consumer agenda. Immunizing businesses would endanger workers, slow reopening of businesses, and give corporate wrongdoers a pass when they fail to take reasonable actions to keep people safe.

Despite the Chamber’s warnings that a flood of coronavirus cases is imminent, its rhetoric has no basis in fact. The issue brief exposes how the Chamber has used Chicken Little’s the “sky is falling” rhetoric for more than 20 years to scare legislators, the media, and the public to limit individuals’ access to the justice system

Yet, the sky never falls. A flood of litigation never emerges.

Months deep into the pandemic, there is no sign of a flood of coronavirus litigation against companies. In fact, the biggest bucket of cases by far are business-to-business lawsuits. The second biggest number of cases are civil rights violations, many of which only seek court intervention to stop alleged civil rights violations rather than award money damages.

Yet, the Chamber continues to push a false and hyperbolic narrative, even when it is unpopular with the public. Sixty-four percent of voters oppose letting corporations off the hook by giving them immunity from liability if it is proved that a company “engaged in unsafe practices.” That includes 72% of Democrats, 64% of Independents, and 56% of Republicans.

As the issue brief cogently points out, “[i]mmunity from liability will not restore our country from this time of hardship.” Instead, make sure that Mitch McConnell knows that lawmakers must prioritize public health over corporate profits. Only then, after businesses are safe for workers, consumers, and patients, can the nation begin to recover.

July 26, 2019

The Chamber’s Report Claiming Forced Arbitration Benefits Workers is a Farce

Craig Sandler Civil Justice, Regulations, Workers' Rights 0

Recently, the U.S. Chamber of Commerce-affiliated Institute for Legal Reform (ILR) released a report titled “Fairer, Faster, Better: An Empirical Assessment of Employment Arbitration.” If that title causes you to raise an eyebrow, you’re right to be suspicious. Through dubious evidence and misleading rationale, the ILR report concludes that workers benefit more by being forced into arbitration rather than being allowed to press their claim in open court before a neutral judge and jury.

Forced arbitration is a system wherein workers must give up their right to sue their employer or join a class action against the employer should they face harm such as discrimination or harassment in the workplace. Rather than have these claims of harms assessed by an impartial judge and jury, employees under forced arbitration clauses in their contracts must instead seek to address grievances before private arbitrators. These arbitrators do not have to follow judicial precedent, and the complaints alleged in arbitration cases are rarely made public, keeping other employees or the public at large in the dark about the harms that have occurred within a corporation. For these and other reasons, despite the ILR’s claims, forced arbitration is very much not beneficial to workers.

The Chamber and ILR have longed advocated for forced arbitration, a dispute resolution process that advantages Big Business, for example by allowing companies to escape full accountability for wrongdoing like wage theft and misclassification of workers.

The ILR report was written by ndp | analytics, a strategic research firm that for large corporate clients. The report seems designed as a tool for corporate lobbyists to sway lawmakers to oppose any legislation that would prohibit companies from forcing workers, consumers, and small businesses into forced arbitration. It is no surprise, then, that the report was conveniently published shortly before a hearing in the U.S. House of Representatives on forced arbitration.

Over the years, the Chamber has consistently taken anti-worker stances on other matters of civil justice and workplace safety. The ILR report even fits with one of the Chamber’s favorite tricks: claiming that pro-worker policies like overtime protection and a higher minimum wage would be harmful to workers. The Chamber loves to pretend it’s standing up for David when it advocates for Goliath’s favored policies. The Chamber’s stance on forced arbitration flies in the face of the overwhelming consensus among labor experts that the practice is harmful to workers.

The ILR’s so-called “empirical assessment” mentioned in the report’s title amounts to selectively using misleading data to advance an ideological narrative, and the report’s methodology is designed to skew the results in ways that favor the Chamber’s dubious claims.

Labor policy experts Terri Gerstein and Heidi Shierhold write in the American Prospect that the report is “an epic presentation of wrong answers to wrong questions.” Gertstein and Shierholz note that the report’s data is glaringly selective in deeply misleading ways. For instance, the report omits class actions and state court lawsuits in its litigation data, glosses over the fact that forced arbitration’s biggest problem is that it “prevents workers from ever bringing cases in the first place,” and neglects decades of established academic studies on the topic showing that consumers and workers lose out when they are forced into arbitration.

In an expanded critique of the report on the Economic Policy Institute blog, Gertstein and Shierholz note several more flaws in the report’s methods and conclusions. These include that:

The information available on arbitration is extremely limited and the report analyzes only a small fraction of the arbitration cases that occurred between 2014 and 2018
The report analyzes employees in the arbitration sample with much higher earnings than the general public
The report fails to consider the benefit litigation has in securing settlements in cases that do not go to trial

The end result, Gerstein and Shierholz argue, is to skew the results of the analysis toward the Chamber’s pre-existing premise that forced arbitration is beneficial for workers.

Perhaps the Chamber is tossing out every argument it can in the hopes that something will stick, no matter how patently ridiculous the claim, because it sees the growing bipartisan momentum against forced arbitration. Three congressional hearings focusing on forced arbitration have already been held in 2019 alone. In February, Sen. Richard Blumenthal (D-CT) and Rep. Hank Johnson (D-GA) introduced the Forced Arbitration Injustice Repeal (FAIR) Act in both the U.S. House of Representatives and U.S. Senate. The FAIR Act would prohibit companies from forcing consumers, workers, and small businesses into using arbitration before a dispute has even occurred. And according to a recent survey, more than 80 percent of both Republicans and Democrats support ending the practice of forcing workers, consumers, and small businesses into arbitration.

Forced arbitration restricts the rights of workers, consumers, and small businesses to seek justice in court before an impartial judge and jury and shields corporations from accountability for illegal practices and other wrongdoing. We should see ILR’s flailing for what it is: an attempt by the Chamber, afraid of the strength of the movement against forced arbitration, to pull the wool over lawmakers’—and the public’s—eyes so it can preserve anti-worker policies that benefit the bottom line of its corporate benefactors.

U.S. Chamber Watch is a project of Public Citizen. If you’d like to learn more about the Chamber, you can always visit us on www.chamberofcommercewatch.org or follow us on Facebook and Twitter.

January 11, 2019

New Year, New Congress—Same Old U.S. Chamber

Craig Sandler Civil Justice, Lobbying, Regulations, Secret Money 0

Never at a loss for spinning its corporate-friendly agenda as somehow benefiting working Americans, yesterday’s “2019 State of American Business Address” by the U.S. Chamber of Commerce’s CEO, Thomas J. Donohue, was a textbook example of using syrupy public relations-friendly language to mask the Chamber’s true intent. The speech laid out the Chamber’s policy priorities for 2019 and for the newly sworn-in 116th Congress in characteristically rosy terms.

A closer look at what was officially called the “#AmericanDreams” speech, though, paints a starkly different picture from how it sounded on its surface. The vision Donohue laid out—of maintaining private, for-profit healthcare; of an unregulated pharmaceutical industry free to price gouge consumers; of unrestrained use of fossil fuels that would pollute our environment and further contribute to climate change; of policies preventing consumers and workers from suing corporations that have harmed or discriminated against them; and of a total lack of transparency in corporate political spending—would be more like an American Nightmare for the average citizen.

When Donohue claims that the state of the economy is extremely strong, what he really means is that it’s great if you’re a CEO or wealthy stockholder raking in record corporate profits and increased share values due to record stock buybacks. However, the average American has been facing years of wage stagnation, job insecurity, underemployment, and a dangerous lack of worker protections. And, when he says “prudent regulation,” he means fewer safeguards for workers, consumers, and the public at large.

The Chamber’s well-funded and heavily-staffed lobby machine can be very savvy. So, when it says it will “take bipartisanship into account” we know that means that with a Democratic-controlled U.S. House of Representatives in the 116th Congress, the Chamber cannot simply rely on congressional Republicans to pass its corporate agenda alone, as it’s done for years. And though the Chamber has added bipartisanship as a criterion in its 2019 legislative scorecard (at 10% of total score, making it roughly the weighted equivalent of the “participation” grade in an average college class), these feints toward moderation are merely PR. Its policy advocacy is no less extreme in its tilt toward corporations and the extremely wealthy folks who make up its donor base and against the average consumer, worker or family.

To wit: Donohue promises to “use all of our resources to combat” a single-payer healthcare system. Although such a system would overwhelmingly benefit the average American and is tremendously popular with the public, it would endanger the Chamber’s corporate buddies in the health industry, so the Chamber is now threatening to oppose it with all of its considerable lobbying might. Elsewhere in the speech, Donohue claims that protests of natural gas pipelines and the push to keep fossil fuels in the ground are causing undue strain on American traditional energy producers. In reality, this decline is because those entities are themselves fossils, tied to a business model that is no longer profitable (let alone prudent given the clear evidence of climate change). This willfully misleading stance proves the Chamber is just as beholden to the fossil fuel industry as ever.

Later in the speech, Donohue claims that Americans’ right to file civil and class action suits “undermines justice” when really it protects vulnerable populations from powerful wealthy interests. And, when the Chamber says that the U.S. should restrict shareholder rights to “reform” publicly-owned corporations’ policies on matters such as disclosure of political spending, it really means it wants average investors to have less of a say and intends to do all it can to ensure secret money continues to be dumped into political campaigns.

In all of these cases, the Chamber’s policy goal amounts to letting corporations do whatever they want with zero accountability and zero protection for the public interest. The Chamber may be attempting to put on a fresh new face to deal with a new Congress, but rest assured, its agenda is as pro-corporate and anti-Main Street as ever. Perhaps instead of promising to stand for “every child, every family, every worker, and every entrepreneur,” a more honest promise would be that the Chamber stands for “every corporation, every billionaire, every Big Bank, and every CEO.”

August 30, 2018

JUDGE BRETT KAVANAUGH’S DECISIONS IN CASES WITH LEADING BUSINESS ASSOCIATION INVOLVEMENT

Public Citizen Civil Justice 0

Over the last several decades, Big Business associations, led by the U.S. Chamber of Commerce, have become far more active in federal litigation. Agency regulators now anticipate a lawsuit from a trade association when they issue major regulations. And trade associations led by the Chamber regularly file amicus briefs. Those briefs make legal arguments; they also serve to signal to judges what the Chamber and other trade associations believe to be important.

For this report, we identified cases that came before Judge Kavanaugh and in which the Chamber of Commerce, National Association of Manufacturers (NAM), or the American Petroleum Institute (API) participated as a party or amicus curiae.

To compile the list of relevant cases, we did Westlaw and Bloomberg searches for D.C. Circuit decisions where Judge Kavanaugh sat on the panel or that were heard en banc, and that included “Chamber of Commerce” or “National Association of Manufacturers” or “American Petroleum Institute.” We assessed whether Judge Kavanaugh sided for or against the business group.

Our findings: In 25 of the 33 cases (76%) we found that were relevant to this inquiry, Judge Kavanaugh sided with the position advanced by the U.S. Chamber of Commerce, National Association of Manufacturers or American Petroleum Institute. In 8 cases (24%), he ruled against the position of the business group.[1]

Sided With Business Group

Case Name	Citation	Business Group
FTC v. Boehringer Ingelheim Pharmaceuticals, Inc.	892 F.3d 1264 (D.C. Cir. 2018)	Chamber as Amicus for Appellee
American Petroleum Institute v. EPA	883 F.3d 918 (D.C. Cir. 2018)	API as Appellant
Loan Syndications and Trading Association v. SEC	882 F.3d 220 (D.C. Cir. 2018)	Chamber as Amicus for Appellant
PHH Corporation v. CFPB	881 F.3d 75 (D.C. Cir. 2018)	Chamber as Amicus for Petitioner
National Labor Relations Board v. CNN America, Inc.	865 F.3d 740 (D.C. Cir. 2017)	Chamber as Amicus for Appellee; NAM as Amicus for Petitioner
Americans for Clean Energy v. EPA	864 F.3d 691 (D.C. Cir. 2017)	API as Intervenor Respondent[2]
American Petroleum Institute v. EPA	862 F.3d 50 (D.C. Cir. 2017)	API and NAM as Appellants
FedEx Home Delivery, an operating division of FedEx Ground Package System, Inc. v. National Labor Relations Board	849 F.3d 1123 (D.C. Cir. 2017)	Chamber and NAM Amicus for Appellant
PHH Corporation v. CFPB	839 F.3d 1 (D.C. Cir. 2017)	Chamber as Amicus for Petitioner
EarthReports, Inc. v. FERC	828 F.3d 949 (D.C. Cir. 2016)	API as Respondent-Intervenor
District of Columbia v. Department of Labor	819 F.3d 444 (D.C. Cir. 2016)	NAM as Amicus for Appellee
Defenders of Wildlife and Center for Biological Diversity v. Jewell	815 F.3d 1 (D.C. Cir. 2016)	API as Intervenor Appellee
U.S. ex rel. Purcell v. MWI Corp.	807 F.3d 281 (D.C. Cir. 2015)	NAM as Amicus in support of reversal
Energy Future Coalition v. EPA	793 F.3d 141 (D.C. Cir. 2015)	API as Intervenor for Respondent
In re Kellogg Brown & Root, Inc.	756 F.3d 754 (D.C. Cir. 2014)	Chamber as Amicus for Petitioner; NAM as Amicus for Petitioner
Center for Biological Diversity v. EPA	749 F.3d 1079 (D.C. Cir. 2014)	API as Intervenor Appellees
White Stallion Energy Center, LLC v. EPA	748 F.3d 1222 (D.C. Cir. 2014)	Chamber as Amicus for Petitioner
Texas v. EPA	726 F.3d 180 (D.C. Cir. 2013)	NAM and API as Amicus for Petitioner
American Petroleum Institute v. EPA	706 F.3d 474 (D.C. Cir. 2013)	API as Petitioner
Grocery Manufacturers Association v. EPA	704 F.3d 1005 (D.C. Cir. 2013)	API as Petitioner
National Association of Manufacturers v. NLRB	2012 WL 1521549 (D.C. Cir. 2012)	NAM as Appellant
Coalition for Responsible Regulation v. EPA	2012 WL 6621785 (D.C. Cir. 2012)	Chamber, NAM, and API as Intervenors for Petitioner
Doe v. Exxon Mobil Corp.	654 F.3d 11 (D.C. Cir. 2011)	Chamber and NAM as Amicus for Appellees
Pharmaceutical Care Management Association v. District of Columbia	613 F.3d 179 (D.C. Cir. 2010)	Chamber as Amicus for Appellee
Sierra Club v. EPA	536 F.3d 673 (D.C. Cir. 2008)	API as Intervenor Appellee

Sided Against Business Group

Case Name	Citation	Business Group
Murray Energy Corp. v. EPA	788 F.3d 330 (D.C. Cir. 2015)	Chamber and NAM as Amicus for Petitioners
American Meat Institute v. Department of Agriculture	760 F.3d 18 (D.C. Cir. 2014)	NAM and Chamber as Amicus in support of Appellants
National Mining Association v. McCarthy	758 F.3d 243 (D.C. Cir. 2014)	Chamber, API, and NAM as Amicus for Appellees
National Association of Manufacturers v. EPA	750 F.3d 921 (D.C. Cir. 2014)	NAM as Appellant
Delta Air Lines, Inc. v. Export-Import Bank of the U.S.	718 F.3d 974 (D.C. Cir. 2013)	NAM as Amicus for Appellee
Mingo Logan Coal Co. v. EPA	714 F.3d 608 (D.C. Cir. 2013)	Chamber as Amicus for Appellee
New York-New York, LLC v. NLRB	676 F.3d 193 (D.C. Cir. 2012)	Chamber as Amicus for Petitioner
Nat’l Association of Home Builders v. OSHA	602 F.3d 464 (D.C. Cir. 2010)	Chamber and NAM as Petitioners

[1] Cases from our searches not included in this tally were primarily cases in which the groups appeared in the court’s opinion in a case citation. In addition, in Seven-Sky v. Holder, 661 F.3d 1 (D.C. Cir. 2011), the Chamber appeared as amicus in support of neither party arguing that if the Affordable Care Act’s individual mandate was unlawful, then the court should strike down the entire Act because the mandate was not severable. The court held that the individual mandate was within Congress’s power. Judge Kavanaugh dissented on jurisdictional grounds, arguing that the Anti-Injunction Act barred the suit, and did not weigh in on the merits.

[2] In this case, Judge Kavanaugh agreed with two of the three arguments advanced by API.

photo of a "binding contract"-- stack of papers that has a lock through it

June 1, 2018

U.S. Chamber Files SCOTUS Brief In Support of Forced Arbitration for Employees

Craig Sandler Civil Justice, Workers' Rights 0

One of the most important legal tools that exists to protect against corporate wrongdoing is allowing harmed individuals to band together to sue as a class or collective action. Last week, the U.S. Supreme Court ruled that employers can use forced arbitration clauses in employment contracts to block employees from bringing collective and class action lawsuits against their employer. As a result, employers will have free rein to force employees to sign arbitration agreements that waive the right to bring collective or class actions as a condition of employment.

This is a devastating blow to workers’ rights because it is difficult for workers to prove violations of the law such as wage theft or discrimination if they cannot band together with co-workers to show a pattern of abuse. Class actions are also more efficient and can be the only feasible way to bring small dollar claims since the cost of bringing a case can outweigh the monetary harm to any one person but the wrongdoing was widespread. Last week’s SCOTUS decision, Epic Systems v. Lewis, will herald in an era of further restrictions for workers’ access to the courts and drastically weaken the ability to achieve justice in the face of accountability for employers’ wrongdoing. Unsurprisingly, the U.S. Chamber of Commerce’s hands are all over this misguided decision.

The Chamber filed a “friend of the court” amicus brief in support of the employers, arguing that the National Labor Relations Act (NLRA) does not protect against forced arbitration as the employees’ legal team argued it does. It makes sense that the Chamber is so invested in advocating for weak employee protections; this fits in with the Chamber’s long legacy of hostility toward workers’ rights. The corporations that make up the Chamber’s membership have a financial interest in employers’ unmitigated ability to dictate all the terms of employees’ contracts.

The Chamber’s allies in the corporate sphere are already jumping at the opportunities provided by the Court’s decision. Shortly after the decision was announced, employment firm Ogletree Deakins released an automated ‘DIY’ tool for companies to include forced arbitration clauses in their contracts.

The Supreme Court’s ruling is alarming to civil rights and consumer rights activists who worry that the decision will limit employees’ access to justice in order to fight a whole host of corporate wrongdoing including discrimination, wage theft, and sexual harassment. Just this week, in light of the Epic decision, Chipotle petitioned a court to exclude more than 2,000 persons from an ongoing wage theft lawsuit because the company argued the workers signed arbitration agreements that prohibited them from joining any class actions.

In her dissent, Justice Ruth Bader Ginsburg noted that “[i]t would be grossly exorbitant to read the FAA [Federal Arbitration Act] to devastate Title VII of the Civil Rights Act of 1964 and other laws enacted to eliminate, root and branch, class-based employment discrimination.” She also called on Congress to pass legislation that would affirm the right of employees to join class actions to oppose discriminatory employment contracts such as violations of equal pay for women.

Public Citizen is committed to doing just that by working to make sure the Arbitration Fairness Act is passed, which prohibits forced arbitration for employment, consumer, antitrust or civil rights disputes, and also by spearheading corporate campaigns to call on individual companies to voluntarily end the use of forced arbitration clauses. If the Arbitration Fairness Act were to receive a vote—something that’s not likely in the current Congress, unfortunately—you can bet that the Chamber’s voice would bellow in opposition as it has done in the past.

As Public Citizen noted in its own friend of the court brief that we filed in support of workers, access to the courts is an essential right for workers and consumers to in standing up to corporate abuses. The Chamber, it seems, would prefer to let those abuses run rampant.

January 11, 2018

The U.S. Chamber of Commerce’s 2018 Priorities are the Same as Always—Protecting Profits Instead of People

Remington A. Gregg Civil Justice, Human Rights, Money in Politics 1

U.S. Chamber of Commerce president Thomas Donohue gave his “State of the American Business” address yesterday, signaling that the trade association and the nation’s largest lobby spender couldn’t be happier about benefits that were handed out to Big Business over the past year, which included record Wall Street profits and a massive tax giveaway.

Unfortunately, many of those gains did not reach Main Street and won’t. And, even though Donahue himself admitted that “the prosperity hasn’t flowed to every community or every household,” he remained undeterred in touting discredited “trickle down” economic theories. His address featured a laundry list of anti-consumer priorities for 2018 that are geared toward maximizing big business’s profits at the expense of public safety and health.

Donahue gushed both about last year’s massive tax giveaway for the wealthiest, as well as the Trump administration’s commitment to undo critical health and safety regulations in order increase corporate profits. The tax handouts for corporations will be paid for by cuts to critical government services like Medicaid, education, and nutrition programs leaving hard working U.S. families decidedly worse off. The push to deregulate and undo our nation’s public safeguards will lead to more tainted food, dangerous products, and unsafe medicines—outcomes that will harm or even kill Americans.

If cutting services that help everyday people in order to pay for tax cuts for profitable corporations and gutting health and safety regulations weren’t enough of “achievements” for the Chamber, it is urging Congress to make massive cuts to the nation’s safety net benefit programs moving forward, which could gravely impact millions of older and underprivileged Americans. And the Chamber is gearing up its fight to help corporations combat shareholders resolutions that give shareholders a say in the management of the companies they invest in and increase transparency in those companies.

In addition, the Chamber’s Institute for Legal Reform will continue to work to limit a person’s right to their day in court—benefitting big banks, insurance companies, and massive corporations that seek to close the courthouse doors on consumers who have been defrauded, cheated, or ripped off.

To accomplish all of this, the Chamber is doubling down on siding with Wall Street over Main Street by aggressively recruiting candidates for political office who promise to work on behalf of their overly partisan, Big Business-enriching goals.

Unlike most fair-minded Americans, the Chamber is devotedly against the principle that America succeeds when everyone succeeds, and instead leaves its faith in the failed theory that when “pro-growth agenda succeeds, America succeeds.” Instead of asking what policies will directly help working families, the Chamber continues to pursue policies that limit our access to courts, curtail health and safety regulations, advance trade policies that harm American workers, and side with corporations over investors.

Donohue firmly believes that the “state of American businesses” is strong. Unfortunately, it is at the expense of hardworking Americans and their families.

September 11, 2017

The Chamber’s Small Business Sham

Grace Aylmer Civil Justice, Lobbying, Regulations, Technology 0

This week, the U.S. Chamber of Commerce will host its annual Small Business Summitin Washington, DC. The stated purpose of the three day event is to provide small businesses with tools and strategies “to successfully compete in today’s rapidly changing business environment.” While this sounds well and good, the Chamber unsurprisingly fails (yet again) to mention that its role as “the voice of small business” is really just a sham.

The Summit agenda consists of a multitude of panels, including “How to Get Your Company Thinking Like a Startup,” “Your State’s Lawsuit Climate and How It Affects Small Businesses,” and “How and Why Your Business Grows (or Doesn’t).” Sure, these panels sound innocent enough to someone who isn’t well-versed on the Chamber, but in reality—they hide the many times the Chamber has lobbied to stack the deck against small businesses. We’ve taken the liberty of renaming and reframing the Summit panels so that they are more honest about the Chamber’s relationship with small business:

Litigating Against Small Business for Beginners: Chamber vs. Main Street

Looking to keep consumers out of court? Hoping to sue a mom-and-pop shop? This panel is for you!

While the Chamber may claim to be the voice of small businesses in Washington, when it comes to litigation, it can be consistently relied upon to favor the huge corporations that fund it. Whether it’s arguing for reduced access to the courts, opposing stricter supervision of Wall Street banks designed to reduce the risk of future financial crises, fighting for Big Oil against emissions controls, or supporting Big Pharma’s schemes to keep drug prices sky high, the Chamber always comes down on the side of its deep-pocketed Big Business patrons, ignoring the impact on small businesses. In fact, in a report earlier this year, Chamber Watch found that the Chamber files a brief roughly every other day of the work week, and in almost 60 percent of cases, the Chamber supported at least one Fortune 500 company. In comparison, it supported a domestic small business only 7 percent of the time. In fact, it supported a foreign multinational twice as often as it did a domestic small business. Companies the Chamber litigated on behalf of included State Farm, Bank of America, Goldman Sachs, Allstate, Berkshire Hathaway, Deutsche Bank, Citigroup, Wells Fargo, AIG, and JP Morgan Chase, ExxonMobil, Koch Industries, BP, PPL, and Shell, to name a few.

Regulations help Small Business? Deny Deny Deny 101

Have you heard the term “red tape” but aren’t sure how to work it into every day conversation? Stop by this lecture to hear from Chamber experts on their experience in denying that regulations actually help rather than hurt small businesses. This panel will equip you with all the tools you need to ignore the statistics that show small businesses support regulation and steer the conversation elsewhere. Did someone say red tape?

The Chamber has a long history of opposing regulations under the guise of being a voice for small business. From the overtime rule, to the Clean Water Rule to the Clean Power Plan, to the open internet rules (have we made our point?) it has yet to meet a regulation it didn’t want rolled back. According to a poll by Small Business Majority, 86 percent of small business owners agree some regulation of business is necessary for a modern economy, and 93 percent of them agree their business can live with some regulation if it is fair, manageable and reasonable. What’s more, 78 percent of small employers agree regulations are important in protecting small businesses from unfair competition and to level the playing field with big business. Another 79 percent of small business owners support having clean air and water in their community in order to keep their family, employees and customers healthy, and 61 percent support standards that move the country towards energy efficiency and clean energy.

Net Non-Neutrality: Even We Know We’re Wrong on This One

Are you an AT&T or Comcast employee who accidentally wandered into this Summit? You’re in the right place now!

The Chamber has conceded that the vast majority of Americans, support net neutrality. In fact, even smaller internet service providers (ISPs,) part of the small business community that the Chamber loves to claim to represent, support net neutrality regulations because they prevent larger competitors from gaining an unfair advantage. Proponents of net neutrality argue that by ensuring equal treatment of all internet content, companies compete on a level playing field and consumers are able to access whatever content they want without issue. Meanwhile, the Chamber and other opponents argue that net neutrality regulations limit incentives for ISPs to improve their networks. These critics argue that without charging companies to guarantee access to content, ISPs won’t have the money necessary to make these investments. In reality, investment in internet infrastructure has not decreased as a result of net neutrality regulations. That leaves only one constituency in favor of deregulation: giant telecom companies.

With its anti-small business record so clear, why does the Chamber still keep up its yearly sham? Apparently the “Big Business Summit” just doesn’t have the same ring…

Chamber Watch is a project of Public Citizen. If you’d like to learn more about the Chamber, you can always visit us on www.chamberofcommercewatch.org or follow us on Facebook and Twitter.

August 24, 2017

Who Will Chamber Side With in Wells Fargo vs. Mom & Pop Shops?

Grace Aylmer Civil Justice 0

Wells Fargo has done it again. And again. And again. This time, instead of creating fake accounts that customers weren’t aware of, or allegedly charging them for auto insurance they didn’t need, Wells Fargo has come for the mom and pop shops of Main Street, USA.

A new class action lawsuit alleges that Wells Fargo has been overcharging small businesses for processing credit card transactions, asserting that Wells’ 63-page Merchant Processing Application included “voluminous legalese that could not possibly be read in its entirety or understood by merchant customers.” The suit claims that various fine print provisions allowed the bank to charge merchants arbitrary fees.

According to the suit, one of the plaintiffs in the case, a small business owner in Charlotte, was charged monthly fees for failing to meet a minimum number of transactions, a minimum he believed had been waived. Another plaintiff, a Pennsylvania small business owner, claims he was charged numerous additional fees including monthly charges even after his business closed. In each case, fine print clauses in the contract were used to justify the imposition of these additional fees.

This case is yet another example of Wells Fargo using fine print to rip off its customers, be they individual consumers or small businesses. In the fake account scandal, Wells continuously used forced arbitration clauses buried in fine print to block class actions challenging its improper behavior. These “rip-off” clauses, commonly found in contracts for a variety of financial products such as banks accounts, credit cards, and loans, ban individuals and small businesses from banding together and challenging wrongdoing in court.

Instead of litigating allegations of fraud and other abusive practices in court before a neutral judge, banks like Wells Fargo can force consumers and small businesses into an individual and secretive arbitration process where the arbitrator who will hear the case is a person chosen by the financial institution. By robbing defrauded customers of their day in court, financial institutions are able to get away with widespread misconduct, because few people have the time or resources to pursue often small dollar claims alone in secret arbitration.

While much of the Wells coverage to date has been heavily focused on defrauded consumers, rip-off clauses harm small businesses as well, making it nearly impossible for small business owners to protest hidden fees, illegal debt collection, and other deceptive or unfair practices. Almost any time a mom and pop store does business with a financial services company, chances are the contract contains a rip-off clause. Nearly all credit card agreements force customers into arbitration if there is a dispute – and credit cards are one of the top three sources of short term capital used by small businesses.

It seems probable that this latest case will end up being another instance in which Wells will attempt to use forced arbitration as a “get out of jail free” card.

Fortunately, a newly released rule from the Consumer Financial Protection Bureau (CFPB) will prohibit banks and lenders that break the law from stripping consumers of the right to join together and hold these institutions accountable in class action lawsuits. Small businesses that use consumer financial products will also be protected by this rule.

That’s the good news. Now the bad news. The U.S. Chamber of Commerce, the country’s most powerful business lobby, is already pushing Congress to kill the rule and rob consumers of the ability to join together to hold banks accountable in court for wrongdoing. Without the CFPB arbitration rule, Wells Fargo and other financial services companies will continue to pocket billions in ill-gotten gains at the expense of consumers and small businesses. This new rule will restore accountability and transparency, making our financial system stronger and safer for all of us.

The Chamber has a tough choice to make. On the one hand, it has lobbied extensively against limits on rip-off clauses and is now is urging Republicans in Congress to repeal the rule under the Congressional Review Act. On the other, it repeatedly claims to be the voice of small business.

So, when the rubber meets the road, will the Chamber continue lobbying to give a free pass to institutions like Wells Fargo, or will it stand up for the small businesses it claims to represent in its promotional materials? If the Chamber really is the voice of small of business, then this latest case against Wells Fargo presents a perfect opportunity for the Chamber to put its money where its mouth is. The Chamber should take a stand on behalf of mom and pop shops by ceasing to defend the rip-off clauses big banks use to take advantage of small businesses. Otherwise, it’s simply defending corporate greed.

July 12, 2017

CFPB Arbitration Rule: Chamber Sides with Wall Street Over Consumers & Small Businesses

Grace Aylmer Civil Justice 0

The U.S. Chamber of Commerce wasted no time in opposing the Consumer Financial Protection Bureau’s final arbitration rule that was released Monday, criticizing it as a “brazen” act.

Too often, consumers are blocked by “rip-off clauses”, a fine-print trick that banks and predatory lenders use to evade accountability and conceal illegal behavior by prohibiting individuals and small businesses from having their day in court and forcing them into opaque arbitration proceedings. Under arbitration, the corporation gets to pick the arbiter who will hear the case. As such, arbitration inherently stacks the deck against consumers and small businesses and oftentimes serves as a get-out-of-jail-free card for rogue financial institutions, leaving consumers defrauded and without any other legal recourse.

The newly issued rule would restore consumers’ right to band together in class-action lawsuits against financial firms. Why is this so important? Consider the case of a bank that improperly charges millions of account holders a $50 fee. There are few people who will expend the time and energy necessary to litigate a $50 dispute on their own in arbitration. But this same $50 fee, improperly levied on millions of customers may generate hundreds of millions of dollars in revenue for the bank. Class actions allow consumers to band together and pursue their small dollar claims in court without having to invest time or money. By prohibiting class actions and requiring individual arbitration, rogue banks and other corporations essentially provide themselves with impunity to repeatedly abuse consumers. These giant corporations understand that without the possibility of suing in a class action, the vast majority of consumers will just eat the small fees they may improperly charge.

It should come as no surprise that the rule has the Chamber and its Wall Street friends on red-alert, given that it has the potential cost the industry billions. The Chamber has lobbied extensively against limits on the “rip-off clause,” hoping instead that corporations will be able to continue ripping off consumers with latitude, as we saw in last year’s Wells Fargo fake account scandal. The Wells Fargo case also illustrates another huge advantage of arbitration for corporations. Because arbitration takes place in secret rather than in open court, in the rare instances where a consumer arbitrates a dispute against a corporation, it helps the corporation prevent its alleged misconduct from becoming public, which might trigger investigations by prosecutors or regulatory agencies.

In a joint statement by Lisa Rickard, the president of the U.S. Chamber Institute for Legal Reform (ILR) and David Hirschmann, the president and CEO of the U.S. Chamber Center for Capital Markets Competitiveness, the Chamber asserts its view that the rule has a “complete disregard for the will of Congress, the administration, the American people, and even the courts” and that it ignores “the practical benefits of arbitration, as compared to the court system.”

Sure, the rule may go against the wishes of the current administration, one that is backed by corporate interests who stand to benefit from forced arbitration, but it most certainly does not “disregard” the American people, “or even the courts” for that matter. In fact, it aims to allow people to have their day in court! What the Chamber fails to mention in its scathing critique of the rule, is that more often than not, the “practical benefits” of arbitration fall only upon the big banks and other huge corporations, and not on everyday consumers and small businesses who are too often taken advantage of by corporations intent upon padding their bottom lines through questionable means.

In addition to the Chamber’s statement, the ILR’s Senior Vice President of Legal Reform Policy, Matt Webb, said in an NPR interview that the CFPB’s actions are “an example of an agency largely going rogue, doing the bidding of the plaintiffs’ trial bar and doing something that’s going to be harmful to consumers as well as the business community.”

It seems perplexing, even shocking, that the Chamber is feigning concern for consumers given its history of lobbying on behalf of nearly every industry, often at the expense of average Americans. The Chamber also seems to overlook the fact the CFPB spent three years compiling and analyzing data, resulting in the most comprehensive empirical study ever done on arbitration, requested by lawmakers, demonstrates that forced arbitration effectively wipes out consumer claims.

Not only is the Chamber lobbying against this rule, much like it has lobbied for legislation to restrict individual and small business access to the courts in the past, it also goes to court itself to argue that it should be more difficult for others to exercise this same fundamental right. In fact, the Chamber went to court to argue that others should be denied this same right over 100 times during a recent three year period. How’s that for hypocrisy?

What’s more, in recent years, the Chamber has involved itself in class action cases on behalf of BP, Goldman Sachs, Corinthian Colleges, and a boatload of other corporate bad actors. Should we still be taking their feigned concern over how this rule effects consumers seriously?

Now, the Chamber has vowed to do whatever it can to keep consumers from having their day in court, whether by suing the bureau once the arbitration rule becomes final or by lobbying Republicans to repeal the law using the Congressional Rule Act (CRA).

Let’s be clear about what the Chamber’s crusade in favor of “rip-off clauses” is really about: corporate impunity. The Chamber is once again seeking to make it harder for individuals and small businesses to use the civil justice system to hold corporations and financial institutions accountable for wrongdoing. Forced arbitration shields the Chamber’s Wall Street and big business allies from accountability for anti-consumer practices, thereby encouraging unsavory business practices by allowing violations to go unchecked. The Chamber has shown time and time again that it is neither the voice for small business or consumers, and its unflagging efforts to restrict access to the courts are par for the course. The Chamber may have claimed that the CFPB went rogue, but it and the big banks it represents are the real rogue actors in this story.

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