By Nico Gurian
Mandatory arbitration is everywhere in the daily life of most Americans — when they sign a cell phone contract, buy a cable subscription, or sign up for a checking account. For most Americans, there is no avenue to acquire these basic goods and services without giving up the right to litigate disputes before a court of law. The increased use of mandatory arbitration clauses is not an accident. Buoyed by the Supreme Court’s expansive interpretation of the Federal Arbitration Act over the last few decades, businesses have used mandatory arbitration clauses to insulate themselves from liability by, for example, including class-action waiver provisions in arbitration agreements that can make it financially impossible for plaintiffs to bring substantive claims.
A key aspect of the current arbitral system is that arbitrators’ decisions are subject to extremely limited judicial review, which is an underlying assumption of both Supreme Court jurisprudence and scholarship in this area. This Note seeks to question that assumption. First, it considers traditional rationales for limited judicial review of arbitral decisions and argues that these justifications fail to take into account the realities of the current arbitral system. Second, borrowing from administrative law, it offers a proposal for how states could tailor a system of increased judicial review of arbitration decisions that would better promote fairness while preserving the positive effects of arbitration.