Core Provisions: On May 12, 2011, Sen. Franken (D-MN) re-introduced legislation which would amend the Federal Arbitration Act (FAA) by prohibiting mandatory predispute arbitration agreements. Rep. Johnson (D-GA) introduced identical legislation in the House. The proposed legislation would invalidate and make unenforceable predispute arbitration clauses in civil rights, consumer, and employment disputes. The legislation would not apply to any arbitration provision in a collective bargaining agreement between an employer and a labor organization or between labor organizations.
The proposed legislation follows the Supreme Court’s April 27, 2011 decision in AT&T Mobility LLC v. Concepcion, which held that the FAA preempted a California law that made waivers of classwide arbitration in consumer contracts unconscionable and unenforceable.
Similar legislation was introduced in the 111th Congress in both the Senate (S. 931) and the House (H.R. 1020), but did not make it out of committee.
Status: Sen. Franken introduced the bill (S. 987) with 12 co-sponsors on May 12, 2011. It was referred to the Senate Committee on the Judiciary on the same day. Rep. Johnson introduced the same bill (H.R. 1873) with 62 co-sponsors on the same day. The bill was referred to the House Committee on the Judiciary on the same day.