You're More Likely to Get Struck by Lightning Than Win Arbitration

These aren't murky waters, they're downright poisonous.

The Hidden Clause That's Destroying American Justice

Ever wonder why massive corporate scandals seem to disappear like farts in the wind? Why companies are able to harm millions of customers and somehow avoid real consequences? The answer is hiding in plain sight, buried in the fine print you never read.

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Here's a statistic that should terrify you: In 2022, consumers had just a 0.7% chance of winning money in forced arbitration against corporations. To put that in perspective, you're literally more likely to be struck by lightning (about 1 in 500,000 annually) than to successfully hold a company accountable for harming you.¹

Welcome to the rigged world of forced arbitration, corporate America's best-kept secret and your worst nightmare.

What Exactly Did You Sign Away?

Remember that Terms of Service agreement you clicked "Accept" on without reading? That credit card application you signed? That job contract you were so excited to get?

Congratulations, you just gave away your constitutional rights.

Here's what 99% of Americans don't know: buried in that fine print was likely a forced arbitration clause that stripped away your Seventh Amendment right to a jury trial.² Research shows that fewer than 1% of consumers actually understand what they've agreed to when they accept these terms.³

Think about that. We're talking about your fundamental right to seek justice in public courts, gone with a click.

The Numbers Don't Lie: It's a Rigged Game

Let me paint you a picture of just how badly the deck is stacked against you:

The Consumer Massacre

• 2022: Consumer win rate dropped to 0.7%⁴

• 2020: Only 577 Americans won any money in forced arbitration (out of tens of thousands of cases)⁵

• Overall: Consumers get relief in just 9% of disputes, while companies win 93% of their claims⁶

More people successfully climb Mount Everest each year than win their arbitration cases against corporations. ⁷

The Employee Slaughter

Think workers fare better? Think again. Despite 60 million Americans being subject to workplace forced arbitration, only 82 employees won monetary awards in 2020.⁸

Workers who get to go to real court are twice as likely to win and take home fifteen times more money than those trapped in arbitration.⁹

The Corporate Hall of Shame

So which companies are rigging the system against you? Pretty much all of them.

The Biggest Offenders

Tech Giants: Amazon has been hit with mass arbitrations so severe they actually dropped their arbitration requirements rather than pay the fees.¹⁰

Financial Services:

• Wells Fargo used forced arbitration to hide their fake accounts scandal for over a decade¹¹

• TurboTax/Intuit and Amazon together account for 58% of all arbitration cases¹²

• Credit card companies representing more than half of all credit card debt use these clauses, affecting 80 million consumers¹³

Everyday Companies: Walmart cashiers, Amazon warehouse workers, Uber drivers, customers of AT&T, American Express, Chime, they've all been forced into this rigged system.¹⁴

The Pandemic Profiteers

During COVID, 240 more corporations jumped on the arbitration bandwagon, including Twitter, Square, StubHub, Marshalls, TJ Maxx, and over 70 auto dealerships.¹⁵ Because nothing says "we care about our customers" like stripping away their rights during a global crisis.

Case Study: How Wells Fargo Got Away With Massive Fraud

Want to see forced arbitration in action? Let's talk about Wells Fargo's fake accounts scandal, a masterclass in how these clauses enable corporate crime.

The Crime

From 2002 to 2016, Wells Fargo employees:

• Forged customer signatures to open unauthorized accounts

• Created fake PINs for debit cards customers never wanted

• Moved money from real accounts to fake accounts (they called it "simulated funding." I call it theft)

• Opened credit cards and services without permission¹⁶

The Cover-Up

Here's the kicker: when customers tried to sue, Wells Fargo pointed to the forced arbitration clauses they'd signed when opening their legitimate accounts. The bank argued that these clauses also covered the fake accounts opened through fraud.

Let that sink in. Wells Fargo essentially argued: "You agreed to arbitration when you opened an account with us voluntarily, so you also agreed to arbitration for accounts we opened by committing fraud in your name."

And many courts said: "Sure, that makes perfect sense."

Six U.S. Senators wrote to Wells Fargo, saying these arbitration clauses "enabled the company to keep its accounts scandal out of the public eye and the courts for years."¹⁷

The result? The average Wells Fargo customer in arbitration was ordered to pay the bank nearly $11,000.¹⁸ The victims of fraud had to pay their victimizer.

How Corporations Rig the System Even Further

Think forced arbitration is just about moving disputes out of court? Oh, it gets so much worse.

They Pick the Refs

Stanford research revealed that securities firms carefully track which arbitrators tend to rule in their favor, then systematically eliminate consumer-friendly arbitrators from the selection process.¹⁹

The result? If arbitrators were chosen randomly instead of through this rigged system, consumers would win about $60,000 more on average.²⁰

The New Tricks

As if the system wasn't rigged enough, corporations have invented new ways to screw you over:

Kafkaesque Hurdles: Companies like Coinbase now require you to jump through multiple "pre-dispute" hoops before you can even file for arbitration, and they get to decide if you've jumped high enough.²¹

Bait and Switch: Companies promise to pay arbitration fees, then refuse when cases are actually filed.²² Uber, Intuit, Postmates, and others have all pulled this trick.

Moving the Goalposts: Live Nation changed arbitration providers mid-dispute when Taylor Swift fans sued them, switching to a startup that depended on Live Nation for most of its revenue.²³

The Human Cost: Who Really Gets Hurt

This isn't just about statistics; it's about real people getting crushed by a rigged system.

The Vulnerable Pay the Price

Forced arbitration disproportionately harms communities of color and low-income Americans who are more likely to be targeted by predatory financial products loaded with these clauses.²⁴

The Deterrent Effect

Here's the most insidious part: the system is designed to make you give up before you even try. With 825 million consumer arbitration agreements in force, only about 7,000 cases are actually heard each year.²⁵

Translation: 99.99% of people just walk away from legitimate grievances because the system is too rigged to bother with.

Why This Should Terrify You

Still think this doesn't affect you? Consider this:

81 of the top 100 U.S. companies now use forced arbitration.²⁶ It's in your:

• Credit cards and bank accounts

• Cell phone contracts

• Employment agreements

• Nursing home contracts

• Even the warranty on your dishwasher

You can't opt out. You can't negotiate. Accept it or don't get the job, the loan, the service, or the product.

The Myth of "Faster and Cheaper"

Corporations love to claim arbitration is faster and cheaper for consumers. That's corporate propaganda.

The Reality:

• Individual consumers rarely have the resources to pursue arbitration effectively

• There's virtually no right to appeal obviously wrong decisions

• The process is secret, so bad arbitrators face no public accountability

• Companies get to see your case strategy but keep theirs hidden

And remember those "cost savings"? The Consumer Financial Protection Bureau found no evidence that companies using arbitration clauses offer lower prices to consumers.²⁷

What You Can Do Right Now

Feeling helpless? Don't. Here's how to fight back:

Immediate Actions

1. Check your contracts - Look for arbitration clauses in your credit cards, bank accounts, and employment contracts

2. Opt out when possible - Some companies offer opt-out periods (usually 30-60 days) that require sending a letter via certified letter/snail mail

3. Vote with your wallet - Choose service providers that don't use forced arbitration when you have options

4. Document everything - If you're harmed by a company, detailed records help even in rigged arbitration

Long-term Solutions

1. Contact your representatives - Tell them forced arbitration is stripping Americans of their constitutional rights

2. Support reform organizations - Groups like Public Citizen, the National Consumer Law Center, and the American Association for Justice are fighting these clauses

3. Spread awareness - Share this article and educate others about what they're signing away

The Bottom Line

Forced arbitration represents the largest transfer of constitutional rights from individuals to corporations in American history. It's not hyperbole to say that it threatens the foundation of our civil justice system.

When corporations can harm millions of people and face virtually no consequences, we don't have a functioning democracy, we have corporate feudalism.

The Wells Fargo scandal should have been a wake-up call. Instead, more companies have doubled down on forced arbitration, developing even more sophisticated ways to deny justice to the people they harm.

But here's the thing: they only get away with it because most people don't know it's happening.

Now you know. The question is: what are you going to do about it?

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This article is for informational purposes only and does not constitute legal advice. If you believe you've been harmed by a company, consult with a qualified attorney about your specific situation.

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Sources

1. American Association for Justice, "Forced Arbitration and Big Banks: When Consumers Pay to Be Ripped Off" (2022)

2. National Consumer Law Center, "Study: 99% of Consumers Unaware they are Subject to Forced Arbitration" (2023)

3. Same source as above

4. American Association for Justice (2022)

5. American Association for Justice, "Forced Arbitration in a Pandemic: Corporations Double Down"

6. Economic Policy Institute, "Forced arbitration is bad for consumers"

7. American Association for Justice, "Forced Arbitration in a Pandemic"

8. Same source as above

9. National Employment Law Project, "FAQ on Mandatory Arbitration in Employment" (2024)

10. American Association for Justice, "Forced Arbitration in a Pandemic"

11. Center for Progressive Reform, "Wells Fargo Fake Account Scandal" (2022)

12. American Association for Justice (2022)

13. Consumer Financial Protection Bureau, "CFPB Study Finds That Arbitration Agreements Limit Relief for Consumers"

14. National Employment Law Project (2024)

15. American Association for Justice, "Forced Arbitration in a Pandemic"

16. U.S. Department of Justice, "Wells Fargo Agrees to Pay $3 Billion to Resolve Criminal and Civil Investigations" (2020)

17. ABC News, "Timeline of the Wells Fargo Accounts Scandal" (2016)

18. Economic Policy Institute

19. Stanford Institute for Economic Policy Research, "Tipping the scales: Balancing consumer arbitration cases"

20. Same source as above

21. American Association for Justice, "The New Forced Arbitration Even Worse Than The Old Forced Arbitration"

22. Same source as above

23. Same source as above

24. Public Citizen, "Consumers' Fraught Journey Into Forced Arbitration" (2024)

25. Consumer Reports, "Forced Arbitration: A Clause for Concern"

26. Same source as above

27. Consumer Financial Protection Bureau