BILL ANALYSIS �
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THIRD READING
Bill No: AB 802
Author: Wieckowski (D)
Amended: 6/16/14 in Senate
Vote: 21
SENATE JUDICIARY COMMITTEE : 5-2, 6/24/14
AYES: Jackson, Corbett, Lara, Leno, Monning
NOES: Anderson, Vidak
ASSEMBLY FLOOR : 54-23, 1/29/14 - See last page for vote
SUBJECT : Private arbitration companies: disclosures
SOURCE : Author
DIGEST : This bill clarifies the information that is to be
disclosed with respect to consumer arbitrations administered by
a private arbitration company, and requires that this
information be made available in a format that allows the public
to search the information and be directly accessible from a
conspicuously displayed link on the Internet Web site of the
private arbitration company. This bill also codifies the
legislative intent that private arbitration companies comply
with all legal obligations of this law.
ANALYSIS : Existing law, with respect to any consumer
arbitration commenced on or after January 1, 2003, requires a
private arbitration company that administers or is otherwise
involved in a consumer arbitration, to collect, publish at least
quarterly, and make available to the public in a
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computer-searchable format accessible on the company's Internet
Web site, if any, and on paper upon request, all of the
specified information regarding each consumer arbitration within
the preceding five years.
This bill requires a private arbitration company that
administers or is otherwise involved in, a consumer arbitration,
to collect, publish at least quarterly, and make available to
the public on the company's Internet Web site, if any, and on
paper upon request, in a single cumulative report that contains
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, and whether the
consumer party was the initiating party or the responding
party, if known.
2. Whether the arbitration was demanded pursuant to a
pre-dispute arbitration clause and, if so, whether the
pre-dispute arbitration clause designated the administering
private arbitration company.
3. The nature of dispute involved as one of the following:
goods; credit; other banking or finance; insurance; health
care; construction; real estate; telecommunications,
including software and Internet usage; debt collection;
personal injury; employment; or other. If the dispute
involved employment, the amount of the employee's annual wage
divided into the following ranges: less than $100,000;
$100,000 to $250,000; inclusive, and over $250,000. If the
employee chooses not to provide wage information, it may be
noted.
4. Whether the consumer or nonconsumer party was the prevailing
party. "Prevailing party" includes the party with a net
monetary recovery or an award of injunctive relief.
5. The total number of occasions, if any, the nonconsumer party
has previously been a party in an arbitration administered by
the private arbitration company.
6. The total number of occasions, if any, the nonconsumer party
has previously been a party in a mediation administered by
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the private arbitration company.
7. Whether the consumer party was represented by an attorney
and, if so, the name of the attorney and the full name of the
law firm that employs the attorney, if any.
8. 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.
9. The type of disposition of the dispute, if known, identified
as one of the following: withdrawal, abandonment, settlement,
award after hearing, award without hearing, default, or
dismissal without hearing. If a case was administered in a
hearing, indicate whether the hearing was conducted in
person, by telephone or video conference, or by documents
only.
10.The amount of the claim, whether equitable relief was
requested or awarded, the amount of the monetary award, the
amount of any attorney's fees awarded, and any other relief
granted, if any.
11.The name of the arbitrator, his or her total fee for the
case, the percentage of the arbitrator's fee allocated to
each party, whether the waiver of any fees was granted, and,
if so, the amount of the waiver.
This bill provides that the changes made by this bill shall not
apply to any consumer arbitration administered before January 1,
2015.
This bill requires the mandated information to be made available
in a format that allows the public to search and sort the
information using readily available software, and would require
that the information be directly accessible from a conspicuously
displayed link on the Internet Web site of the private company
with the identifying description: "consumer case information."
This bill makes other conforming changes and codifies the intent
of the Legislature that private arbitration companies comply
with all legal obligations of this bill.
Background
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Arbitration is a method of alternative dispute resolution where
the disputing parties present their disagreement(s) to one or
more "neutral" third-party arbitrators whose decisions are
generally final and binding, in place of litigating the issues
in courts. The use of mandatory arbitration clauses in consumer
contracts has increased immeasurably in recent years and has
been highly controversial for a variety of reasons, including
issues surrounding concerns of "repeat players" whereby an
arbitrator is inclined to rule in favor of corporations that
return to them to arbitrate future matters. Concerns are
particularly heightened as arbitrators do not have to follow the
law, decisions cannot be appealed, and proceedings are often
conducted without any opportunity for public scrutiny. Many of
these clauses are contained in adhesion contracts used by a wide
range of companies, including telecommunications providers,
banks, doctors, insurance providers, hospitals, and nursing
homes.
AB 2656 (Corbett, Chapter 1158, Statutes of 2002) was enacted as
part of a series of bills that sought to address concerns about
the private arbitration industry, to generally require private
arbitration companies to collect and provide certain data
regarding consumer arbitrations they administer, and to make
that information available in a computer-searchable format on
the company's Web site.
Comments
According to the author, existing law requires a private
arbitration company involved in consumer arbitration cases to
collect and make certain information regarding those cases
available to the public in a computer-searchable format,
accessible at the Internet Web site of the private arbitration
company, if it has an Internet Web site.
This bill modifies existing disclosure requirements and adds two
new required disclosures of arbitration companies. The two new
requirements are:
To disclose whether arbitration was demanded pursuant to a
pre-dispute arbitration clause and, if so, whether the
pre-dispute arbitration clause designated the administering
private arbitration company, and;
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To require that the information disclosed be made available in
a format that allows the public to search the information, and
shall be directly accessible from a conspicuously displayed
link on the Internet Web site of the private arbitration
company with the identifying description: "consumer case
information." This requires that private arbitration
companies provide the currently-required disclosures in a
sortable database format, rather than simply a "searchable"
format.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local:
No
ASSEMBLY FLOOR : 54-23, 1/29/14
AYES: Alejo, Ammiano, Atkins, Bloom, Bocanegra, Bonilla, Bonta,
Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau,
Chesbro, Cooley, Dababneh, Daly, Dickinson, Eggman, Fong,
Frazier, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell, Gray,
Hall, Roger Hern�ndez, Holden, Jones-Sawyer, Levine,
Lowenthal, Medina, Mullin, Muratsuchi, Nazarian, Pan, V.
Manuel P�rez, Quirk, Quirk-Silva, Rendon, Ridley-Thomas,
Rodriguez, Salas, Skinner, Stone, Ting, Weber, Wieckowski,
Williams, Yamada, John A. P�rez
NOES: Achadjian, Allen, Bigelow, Ch�vez, Conway, Dahle,
Donnelly, Beth Gaines, Grove, Hagman, Harkey, Jones, Linder,
Maienschein, Mansoor, Melendez, Morrell, Nestande, Olsen,
Patterson, Wagner, Waldron, Wilk
NO VOTE RECORDED: Fox, Logue, Perea
AL:nl 6/26/14 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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