Consumer Arbitration Fact Sheet

 

This page provides information about the AAA's® administration of consumer arbitrations and links to a number of relevant documents and Rules.

AAA Administration: The AAA administers consumer arbitrations pursuant to the due process standards contained in the AAA's Consumer Due Process Protocol and the AAA’s Consumer Arbitration Rules. The AAA will accept a case for administration only after the AAA reviews the parties’ arbitration agreement and if the AAA determines that the agreement substantially and materially complies with the due process standards of the Rules and the Consumer Due Process Protocol. If the AAA declines to administer a consumer arbitration, either party may submit the dispute to an appropriate court for resolution.

AAA Consumer Arbitration Rules

AAA Consumer Due Process Protocol


Consumer Due Process Protocol: The AAA has been at the forefront in developing standards of fairness for disputes between consumers and businesses. In April 1998, the AAA developed the Consumer Due Process Protocol in cooperation with groups representing government agencies, consumer interest groups and educational institutions, as well as businesses. The goal of the Protocol, in concert with the Consumer Arbitration Rules, is to ensure fairness and even-handedness in the resolution of disputes in arbitration. The AAA exercises its authority to decline administration of arbitration demands where an arbitration clause contains material violations of the Consumer Due Process Protocol. 

Key Provisions of the Due Process Protocol:

  • Consumers and businesses have a right to an independent and impartial arbitrator and independent administration of their dispute.
  • Consumers always have a right to representation.
  • Costs of the process for the consumers must be reasonable.
  • Location of the proceeding must be reasonably accessible.
  • No party may have unilateral choice of arbitrator.
  • There shall be full disclosure by arbitrators of any potential conflict or appearance of conflict or previous contact between the arbitrator and the parties. The arbitrator shall have no personal or financial interest in the matter.
  • Arbitrators should be empowered to grant whatever relief would be available in court.
  • All parties retain the right to seek relief in small claims court for disputes or claims within the scope of its jurisdiction.
  • Parties to the dispute must have access to information critical to resolution of the dispute.
  • The use of mediation to foster voluntary resolution of the matter.
  • Clear and adequate notice of the arbitration provision and its consequences, including a statement of its mandatory or optional character.


Searle Civil Justice Institute Study: The Searle Study reviewed a representative sample of approximately 300 AAA consumer arbitration case files that were awarded between April and December of 2007. Among the findings in the Searle study were conclusions about the costs, speed and outcomes of consumer arbitrations administered by the AAA: 

  • Consumers won some relief in 53.3% of the cases they filed and recovered an average of $19,255; business claimants won some relief in 83.6% of their cases and recovered an average of $20,648.
  • The upfront cost of arbitration for consumer claimants in cases administered by the AAA appears to be quite low. In cases with claims seeking less than $10,000, consumer claimants paid an average of $96.
  • AAA consumer arbitration seems to be an expeditious way to resolve disputes. The average time from filing to final award for the consumer arbitrations studied was 6.9 months.
  • Arbitrators awarded attorneysʹ fees to prevailing consumer claimants in 63.1% of cases in which the consumer sought such an award.
  • A substantial majority of consumer arbitration clauses in the sample (76.6%) fully complied with the Due Process Protocol when the case was filed.
  • AAAʹs review of arbitration clauses for Protocol compliance was effective at identifying and responding to clauses with Protocol violations. In 98.2% of cases in the sample subject to AAA Protocol compliance review, the arbitration clause either complied with the Due Process Protocol or the non‐compliance was properly identified and responded to by the AAA.
  • The AAA refused to administer a significant number of consumer cases because of Protocol violations by businesses, and as a result of AAAʹs protocol compliance review, some businesses modify their arbitration clauses to make them consistent with the Consumer Due Process Protocol.
  • The complete Searle Civil Justice Institute Study may be found at https://www.adr.org/aaa/ShowPDF?doc=ADRSTG_010205.


Small Claims Court Option: The Consumer Due Process Protocols and the AAA's Consumer Rules permit claimants to bring claims in small claims court rather than arbitration even if the claims fall within the parties’ arbitration clause.

Costs: In consumer arbitration proceedings, the consumer’s administrative fee is capped at $200. The business pays the arbitrator’s compensation unless the consumerpost disputevoluntarily elects to pay a portion of the arbitrator’s compensation.

Publicly Available Information: The AAA’s Consumer Rules contain provisions that make certain information publicly available about consumer arbitrations administered by the AAA. This includes Rules establishing a registry of businesses with AAA consumer arbitration agreements and another that provides for the publication of redacted consumer arbitration awards. 

  • Starting September 1, 2014, the AAA implemented a publicly available Consumer Clause Registry. The Registry was created to provide more access to information about the AAA’s consumer arbitration services. In particular, the Registry contains a list of businesses that have submitted their consumer arbitration clauses with the AAA and where, upon review, the AAA has determined that the clause substantially and materially complies with the due process standards of the Consumer Due Process Protocol.
  • The AAA’s publicly available Consumer Clause Registry contains the name of the business, contact information, and the consumer arbitration clause, along with any related documents deemed necessary by the AAA. For more information on the registry, visit www.adr.org/consumerclauseregistry.
  • The AAA maintains a Consumer Arbitration Statistics report on its website based upon consumer cases filed with the AAA for at least the last five years. https://www.adr.org/aaa/faces/aoe/gc/consumer/
    consumerarbstat

     

Debt Collection Moratorium: In 2009, the AAA implemented a moratorium on the administration of debt collection arbitration programs. Matters included in this moratorium are consumer debt collection programs or bulk filings and individual case filings in which the company is the filing party and the consumer has not agreed to arbitrate at the time of the dispute, and the case involves a credit card bill, a telecom bill or a consumer finance matter.

This page provides information about the AAA's® administration of consumer arbitrations and links to a number of relevant documents and Rules.

AAA Administration: The AAA administers consumer arbitrations pursuant to the due process standards contained in the Consumer Due Process Protocol and the AAA’s Consumer Arbitration Rules. The AAA will accept a case for administration only after the AAA reviews the parties’ arbitration agreement and if the AAA determines that the agreement substantially and materially complies with the due process standards of the Rules and the Consumer Due Process Protocol. If the AAA declines to administer a consumer arbitration, either party may submit the dispute to an appropriate court for resolution.

AAA Consumer Arbitration Rules

AAA Consumer Due Process Protocol


Consumer Due Process Protocol: The AAA has been at the forefront in developing standards of fairness for disputes between consumers and businesses. In April 1998, the AAA developed the Consumer Due Process Protocol in cooperation with groups representing government agencies, consumer interest groups and educational institutions, as well as businesses. The goal of the Protocol, in concert with the Consumer Arbitration Rules, is to ensure fairness and even-handedness in the resolution of disputes in arbitration. The AAA exercises its authority to decline administration of arbitration demands where an arbitration clause contains material in violation of the Consumer Due Process Protocol. 

Key Provisions of the Due Process Protocol:

  • Consumers and businesses have a right to an independent and impartial arbitrator and independent administration of their dispute.
  • Consumers always have a right to representation.
  • Costs of the process for the consumers must be reasonable.
  • Location of the proceeding must be reasonably accessible.
  • No party may have unilateral choice of arbitrator.
  • There shall be full disclosure by arbitrators of any potential conflict or appearance of conflict or previous contact between the arbitrator and the parties. The arbitrator shall have no personal or financial interest in the matter.
  • Arbitrators should be empowered to grant whatever relief would be available in court.
  • All parties retain the right to seek relief in small claims court for disputes or claims within the scope of its jurisdiction.
  • Parties to the dispute must have access to information critical to resolution of the dispute.
  • The use of mediation to foster voluntary resolution of the matter.
  • Clear and adequate notice of the arbitration provision and its consequences, including a statement of its mandatory or optional character.


Searle Civil Justice Institute Study: The Searle Study reviewed a representative sample of approximately 300 AAA consumer arbitration case files that were awarded between April and December of 2007. Among the findings in the Searle study were conclusions about the costs, speed and outcomes of consumer arbitrations administered by the AAA: 

  • Consumers won some relief in 53.3% of the cases they filed and recovered an average of $19,255; business claimants won some relief in 83.6% of their cases and recovered an average of $20,648.
  • The upfront cost of arbitration for consumer claimants in cases administered by the AAA appears to be quite low. In cases with claims seeking less than $10,000, consumer claimants paid an average of $96.
  • AAA consumer arbitration seems to be an expeditious way to resolve disputes. The average time from filing to final award for the consumer arbitrations studied was 6.9 months.
  • Arbitrators awarded attorneysʹ fees to prevailing consumer claimants in 63.1% of cases in which the consumer sought such an award.
  • A substantial majority of consumer arbitration clauses in the sample (76.6%) fully complied with the Due Process Protocol when the case was filed.
  • AAAʹs review of arbitration clauses for Protocol compliance was effective at identifying and responding to clauses with Protocol violations. In 98.2% of cases in the sample subject to AAA Protocol compliance review, the arbitration clause either complied with the Due Process Protocol or the non‐compliance was properly identified and responded to by the AAA.
  • The AAA refused to administer a significant number of consumer cases because of Protocol violations by businesses, and as a result of AAAʹs protocol compliance review, some businesses modify their arbitration clauses to make them consistent with the Consumer Due Process Protocol.
  • The complete Searle Civil Justice Institute Study may be found at https://www.adr.org/aaa/ShowPDF?doc=ADRSTG_010205.


Small Claims Court Option: The Consumer Due Process Protocols and the AAA's Consumer Rules permit claimants to bring claims in small claims court rather than arbitration even if the claims fall within the parties’ arbitration clause.

Costs: In consumer arbitration proceedings, the consumer’s administrative fee is capped at $200. The business pays the arbitrator’s compensation unless the consumerpost disputevoluntarily elects to pay a portion of the arbitrator’s compensation.

Publicly Available Information: The AAA’s Consumer Rules contain provisions that make certain information publicly available about consumer arbitrations administered by the AAA. This includes Rules establishing a registry of businesses with AAA consumer arbitration agreements and another that provides for the publication of redacted consumer arbitration awards. 

  • Starting September 1, 2014, the AAA implemented a publicly available Consumer Clause Registry. The Registry was created to provide more access to information about the AAA’s consumer arbitration services. In particular, the Registry contains a list of businesses that have submitted their consumer arbitration clauses with the AAA and where, upon review, the AAA has determined that the clause substantially and materially complies with the due process standards of the Consumer Due Process Protocol.
  • The AAA’s publicly available Consumer Clause Registry contains the name of the business, contact information, and the consumer arbitration clause, along with any related documents deemed necessary by the AAA. For more information on the registry, visit www.adr.org/consumerclauseregistry.
  • The AAA maintains a Consumer Arbitration Statistics report on its website based upon consumer cases filed with the AAA for at least the last five years. https://www.adr.org/aaa/
    faces/aoe/gc/consumer/
    consumerarbstat

     

Debt Collection Moratorium: In 2009, the AAA implemented a moratorium on the administration of debt collection arbitration programs. Matters included in this moratorium are consumer debt collection programs or bulk filings and individual case filings in which the company is the filing party and the consumer has not agreed to arbitrate at the time of the dispute, and the case involves a credit card bill, a telecom bill or a consumer finance matter.

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