The Federal Arbitration Act Needs a Due Process Protocol

When the Federal Arbitration Act (FAA) was enacted in 1925, it was meant to strengthen commercial associations' internal arbitration. In the years since its passage, the type and number of arbitrations have increased exponentially. In part, this increase is because pre-dispute arbitration agreements are now widely used for consumer and employment contracts. Another reason for the dramatic rise in the number of arbitrations is a change in the United States Supreme Court's attitude toward arbitration. In the past thirty years, the Court has expanded the reach of the FAA. In the Mitsubishi Trilogy and Gilmer v. Interstate /Johnson Lane Corp., the Supreme Court held that statutory claims could be arbitrated. This article proposes addressing the concerns with the FAA by amending it to ensure more equitable arbitration contracts and procedures. An amended FAA will save time and expense in resolving disputes. This article seeks to balance the Supreme Court's liberal policy favoring arbitration with the concern that "mandatory arbitration clauses are slowly eroding the legal protections that should be available to all Americans." The second section of this article will briefly summarize the congressional hearings and the concerns the bill sought to address and explain why the AFA is not the best method of addressing those concerns. The third section will describe why the FAA should be amended. Finally, the fourth section will focus on the changes needed in providing a fair arbitration procedure, such as picking neutral arbiters, ensuring adequate discovery, and not severely limiting statutes of limitation.