Arbitration As Wealth Transfer

Lina Khan Director of Legal Policy, Open Markets Institute; Visiting Fellow, Yale Law School and Deepak Gupta Founding Principal, Gupta Wessler PLLC

February 18, 2016

The trend toward circumventing courts in favor of arbitration, abetted by increasingly consolidated corporate power and a business-friendly Supreme Court, is literally taking money from the pockets of the middle class and working poor. That’s the conclusion Gupta and Khan draw after an in-depth review of the redistributive effects of these increasingly common contract provisions. Gupta and Khan examine the growing use of forced arbitration and bans on class action lawsuits in a variety of employment and consumer contracts and seek to draw attention to the role that these changes to procedural rules play in creating economic inequality in an era when “there is growing recognition that changes in substantive law and legal regimes helped usher in the extreme levels of inequality we see today.”

Read the full issue brief here: Arbitration as Wealth Transfer

By Deepak Gupta and Lina Khan