A legal pattern – innovation, slow embrace of the innovation, abuse of the innovation, and gradual control of the abuse

Disputing — a terrific blog dedictated to issues regarding arbitration, mediation, and other means of “alternative” dispute resolution — has given me the honor of writing as a guest. Today on Disputing you can read Part One of

“Alternative” Dispute Resolution, the Rhetoric of Naming, and the Emerging Trend to Invalidate Mandatory Arbitration Clauses and Class Action Waivers in Consumer Agreements

It describes a typical arc for legal innovations. There is innovation, acceptance by the law of the innovation, abuse of the innovation that uses it for purposes other than those it was created to accomplish, and, slowly, the law’s effort to preserve the benefits of the innovation and curb its abuses.

In this case, the innovation is arbitration. As Wikipedia explains, “In the early 20th century, businessmen in New York began promoting the idea of legally binding arbitration to resolve disputes as a less costly alternative to litigation. Courts were hostile to the idea . . . .” Only in the 1950s and 1960s did courts generally accept arbitration and come to universally enforce agreements to arbitrate disputes. During my legal career (I began law school in 1981 and practice in 1984), the enforceability of arbitration agreements became an unquestioned fact.

But, inevitably, businesses began to recognize that requiring their customers to agree to arbitrate disputes rather than engage in litigation in the courts offered other benefits, benefits that had nothing to do with arbitration’s offer of faster and less expensive dispute resolution. And only now (literally, in the last month) are courts both recognizing what is going on and dealing with it effectively.

You can go to Disputing to read part 1 of the story. Part 2 will appear on Disputing tomorrow.