Exact Procedure for Arbitration

[admin]

Can someone lay it out for me?

[trueq]

This post will cover pre-lawsuit exercise of arbitration.

You get a dunning letter from debt collector/lawyer.

You respond with an excellent DV advice from this site.

If you insert the clause in the DV, "If there is an underlying arbitration clause associated with this claim, I hereby exercise it, and waive your litigation rights to this claim, per the underlying arbitration clause."

You should also make a demand for the contract with the arbitration clause.

Point #1) You are not required to file an arbitration by doing this.

Point #2.)You have provided notice of your dispute resolution intentions, if they sue you in court, they have violated the FDCPA...by exercising a legal right that does not exist...ergo arbitration election waives other parties right to litigate.

What options are left if debt collector cannot litigate claim?

Debt collector can arbitrate.

There are only 3 arbitration forums available in 99% of all credit card contracts. NAF, AAA, JAMS. (some have 1 forum named, some have 2 of the 3 forums named, and somtimes clause has all 3 forums named as options.)

Debt collector MUST file with one of these arbitration forums if debt collector intends to use any legal process to recover the debt.

1.) National Arbitration forum (NAF)---Are prohibited by MN AG to accept any credit card arbitrations. NAF could be criminally prosecuted if they do by MN AG consent decree.

2.) American Arbitration Association (AAA)---is out of credit card arbitration business, voluntarily, until it drafts rules to protect consumers. They will refuse any credit card arbitration filing by bank or JDB. They did this because they fear fate of NAF if they are perceived as being unfair to consumers.

3.) Judicial Arbitration Mediation Service (JAMS)---JAMS Chief legal counsel, Jay Welsh, said at FTC hearing 9/29/09, JAMS doesn't do debt collection arbitration. I have confirmed that JAMS will not accept credit card debt collection arbitrations. (I am am still investigating whether JAMS accepts countercliams for debt when consumer slaps bank in JAMS with a big complaint.)

Jay Welsh's full statement: http://www.debt-consolidation-credit...24&postcount=4

So debt collector cannot arbitrate pre-suit.

What is the debt collectors options pre-suit, after you slap them with arbitration "election" in your DV?:

1.) Debt collector/OC could get an agreement from consumer on an alternate arbitration forum. This is about as likely as time travel to Pluto.

2.) Debt collector/OC could file suit. This would violate the FDCPA and give you cause of action against lawyer and law firm. you can still compel court to arbitrate suit with a dismissal or permanent stay. (See next post on post lawsuit arbitration exercise.)

3.) Debt collector/OC could, instead of filing suit, seek a declatory judgment from a court to strike their client's own arbitration clause. "Declatory Judgment" is a fancy term that they got a court to say the arbitration clause cannot be enforced against them by you. I believe this would also violate the FDCPA in several ways. A.) debt collector/OC represented the contract to you for private right of resolution (arbitration) which they are trying to now deprive you of; through such a motion. B.) Challenges to the arbitration clause in the contract IS LITIGATION, which violates FDCPA because you waived their right to litigate on all contractual disputes!!!!!! (This is poetic justice because consumers used to litigate to escape arbitration, but creditors did not have FDCPA to protect them when creditors waived consumers out of court and the consumer continued litigation!!! So its not as easy for the creditor to get clause struck as it was for the consumer!)

PRE-DISPUTE EXERCISE PUTS THEM IN A PICKLE OF A BOX! I HIGHLY URGE IT TO MAXIMIZE FDCPA VIOLATIONS!!!!

I will do a 2ND post on what happens when you exercise arbitration clause post-Summons and Complaint.

[trueq]

This is the post-lawsuit arbitration exercise map.

Arbitration exercise can waive your opponent from court AFTER they sue you.

First things first, What is an arbitration exercise? Its notice to the other side. Here's an example:

http://www.debt-consolidation-credit...0&postcount=11

When you do this you will get 1 of 4 reactions from lawyer:

1.) They will ignore and keep litigating, which violates your FDCPA rights. You need to bring a MTD or MTC arbitration to set them straight.

2.) They will acknowledge and ask court for a stay of the case pending outcome of arbitration.

3.) They will react with scorn and rage!!!! They will try to quickly jam an SJ down your throat, send you massive discovery, anything to get you to "play along" with litigation to show that you were not serious about arbitration. They may even lie, cheat, and steal. I had 1 lawyer deny existence of arbitration clause even when judge had it in front of them and their affiant said that was the agreement!!!! I'm suing this lawyer...

4.) They will just dismiss and surrender. http://www.debt-consolidation-credit...75&postcount=8 20 minutes in front of trial on a 5 figure credit card!


#4 you should never argue with. "Without prejudice is OK" because your arbitration exercise, in the context of waiving their litigation rights, survives dismissal. If they sue again, lawyer violated FDCPA (See pre-lawsuit arbitration exercise for this point.)

#1 and #3 require action on your part. You need to bring a MTD or a MTC arbitration against scumbag. You need to draw up motion and call court clerk to get a date to hear motion. Judge is obligated to grant the motion under Federal Arbitration Act. Here are the issues you need to argue and deal with at such a hearing: Post #2 http://www.debt-consolidation-credit...ght=initiation

#2 Just insist that the "certified professional" bar lawyer initiate the arbitration. See all the problems this causes in the Pre-lawsuit post above!

MAIN KEY: Get judge to order OC/Debt collector to initiate arbitration.

There is an emerging 5th option, which was posted from GA today. ZWICKER AND ASSOCIATES IS TRYING TO STRIKE THE AMEX ARBITRATION CLAUSE IN THE CASE. See my post on how to deal with this. This will really extend the lawsuit timeline! http://www.debt-consolidation-credit...d.php?t=299148

THERE IS ALSO AN ULTIMATE CAUTION: YOU CAN WAIT TOO LONG TO EXERCISE YOUR ARBITRATION OPTION! In my state you can waive your right to arbitrate by participating in discovery or a pre-trial conference...so don't wait forever. However, in other states, like CO you can do it 20 minutes before trial! There is no solid test, so be careful about putting this option off. Its like a DV, use it or lose it!

Now in a perfect world judge ordering scumbag to initiate his own claim in arbitration would be great, but some judges will give consumer 30 or 60 days to literally initiate arbitration against themselves!

While this sounds dumb (and it is), it is not the end of the world. You can make lemonade from the lemon judge's ruling to make you initiate the arbitration.

Up until this point you are only dealing with the court. At this point you cut the court action off and head for the arbitration forum.

Post #3 from me will be the arbitration process itself.

[trueq]

You cannot initiate with NAF. NAF will be criminally charged. Anyway, it would be stupid. NAF is a scam.
____________________________________________
AAA will let you initiate a complaint against a company naming them as arbitration provider. http://www.adr.org/sp.asp?id=36427 However, clause needs to filter through their consumer protocol. There are approx. 600 business where the clause fails AAA protocol. This means AAA refuses to take the case. http://searlearbitration.org/ Links to full Searle report comments on this issue.

AAA refuses to release the list of businesses with unacceptable arbitration clauses. Chase is almost certain to be on it and also Bank of America as well. Both these banks have given up on arbitration.

However, if clause survives AAA protocol review, business can counterclaim against any complaint you file on them in AAA. Meaning they could counterclaim for the debt they are suing you for. I always reccomend staying away from AAA, even though the hurdles for the clause, and consumer protocol, for the OC/debt collector are big in AAA.

AAA does not hear that many debt collection arbitrations. NAF did 216,000 credit card arbitrations in 2006. AAA did about 900 consumer arbitrations in 2007. (This includes credit card and other consumer complaints.) AAA also refused about 85 of those cases for consumer protocol violations. So AAA is not even in same league as NAF in terms of process, but is still a concern for the consumer.
__________________________________________________ ________
JAMS doesn't do debt collection arbitration. So debt collector/OC cannot initiate in JAMS.

http://www.jamsadr.com/consumer-arbitration/

Clause must also survive protocol review. If JAMS finds issues contrary to minimum standards for consumer, JAMS will reject or demand Bank alter or waive unacceptable provisions.

Consumer initiates by filing out paperwork: http://www.jamsadr.com/arbitration-forms/

I always include a big complaint (FDCPA, state consumer law, deceptive trade practice, TCPA, etc.) against OC/debt collector, AND MAKE NO MENTION OF OC'S/DEBT COLLECTOR'S DEBT AGAINST ME THE INITIATION! This "complaint" is separate from the initiation paperwork.

JAMS Key tip #1: JAMS Initiation paperwork does not require you to mention the debt involved in court case! Just sending the letter you receive from JAMS indicating you initiated the arbitration is sufficient for the court! If debt lawyer complains, tell the scumbag, "I am not forwarding your client's claim for you, I asked you to initiate and you cried like a baby that I had to. I initiated my way!" "I don't practice law for your client, maybe you should start."

JAMS KEY TIP #2: Fees, other guy pays all fees. You pay $250. Never, ever pay fee with initiation!!!! Let JAMS bill you. You can demand money from OC/JDB OR request a fee waiver if you are under 300% FPL in income. I got fee waiver. This issue alone took six months. ARBITRATION DOES NOT COMMENCE UNITL THIS ISSUE IS RESOLVED! This includes OC/JDB having to pay $150 of the $400 case management fee.

JAMS Key tip #3: Always demand Comprehensive rule set with initiation AND define that you are a consumer party in initiation paperwork!!!!

Once initiation paperwork is cleared, initial case management fee is paid, a commencement letter is sent.

Once commenced:

1.) Arbitrator is picked. You get list of 5 names, each party gets to cross 2 and rank remaining choices. (Arbitrator bios are on JAMS web site and you can also google their work)
2.) You have 14 days to file complaint from date of commencement letter. If you filed complaint with initiation, OC/ debt collector has 14 days from commencement to answer/counterclaim.
3.) You then have 14 days to answer counterclaim.

Any failure to answer is deemed denied! This is much different than court.

Here is JAMS rules. http://www.jamsadr.com/rules-comprehensive-arbitration/

In my JAMS case, Cap1 just received a bill from JAMS for $2000 for initial case management by arbitrator. Cap1 has not paid it yet.

Arbitration dies if OC/debt collector does not pay!

There is also still a debate whether JAMS will accept debt collection claims as a counter because this would make JAMS chief legal counsel, Mr. Welsh's statement to the FTC deceptive.

Cap1's counterclaim was due today. Nothing.

I've been through class arbitration (2 years ago) and talked to lawyers about my JAMS claim and my approach. They said I will cost Capital 1 a minimum of $10,000 in JAMS fees, maybe $20,000. Cap1's claims were $3000, and $6000 against me in court. My JAMS complaint against them is $140,000 plus.

The attorney I talked with says Cap1 would just be wasting money to pursue this. Any forward of their debt collection claims would violate WI consumer law...Cap1 failed to give 15-day "Notice of right to cure default", this notice failure bars the underlying suits...which is a major part of my state consumer debt collection claim against Cap1.

It does not make a difference either way to me. Here is a case play by play:
http://www.debt-consolidation-credit...d.php?t=298835 This thread also has other people doing this and their experience.

JAMS $2000 bill to Cap1: http://www.debt-consolidation-credit...d.php?t=298895

Just soak in the picture to this point. How much leverage does the consumer have vs. court?

Answer: A LOT. Especially if Maybury court system was just going to rack you up on SJ!

Its hard to know which issues to talk about, any particular issue that needs more explaination?

There is one incontrovertable fact: If Debt lawyer survives to the "JAMS arbitration commencement", (aka "client firing them") they still need to overcome the "JAMS doesn't do debt collection" arbitration hurdle to get their client's counterclaim for the alleged debt considered!

Its a laborious and expensive mess for OC/JDB/debt collector.

[david9041]

Trueq you said ------------Arbitration dies if OC/debt collector does not pay! -------------does your claim die also?

[trueq]

Yes and no. (Typical lawyer answer).

From a technical sense...Yes. But since the OC/JDB refused to fund the arbitration, any possible debt collection claim they had that is on court stay also dies.

So this is the result, a consumer who's been sued, can live with...victory.
__________________________________________________ ___
However, if you really want to grind the ax...and I would consider it....you could try and move for summary judgment in arbitration against OC/JDB (However, JAMS seems very resolute about NOT arbitrating if they don't get paid, so if they refuse to arbitrate we are back to the "pre-lawsuit" forum refusal issue.) but you could...

OR/AND

move in court for sanction against the OC/JDB for not complying with the court's arbitration order

OR/AND

sue lawyer/law firm/JDB/ and possibly OC for violating the FDCPA by ignoring the court order to arbitrate.

__________________________________________________ _

Non-payment of arbitration fees by the OC/JDB results in a ton of options. At the very least, you've achieved victory over their claim for the debt, its then a question of how much you want to grind the legal ax on your claim!

If everyone getting sued everywhere did this, can you imagine the teetoring debt collectors we'd put out of business, just from an arbitration fee billing standpoint?

Many of these OC/JDB's are not paying their lawyers at times, do you think they will fork up $2150 per case to arbitrate something they may not win, while at the same time, forwarding consumer's big claim against them by paying the fees?

JDB/OC NOT paying the arbitration fees is one of the ways to short circuit the electrified box you put them in....but it also short-circuits their claims against you.

This is why it pays not to have a built in prejudice against JAMS because of NAF. Some prejudice of AAA is required for consumer, but not on level on the scam NAF was for the consumer.

In a global sense, if this happens, you have the leverage, at the very least, to get the underlying case on stay, dismissed.

I think you have more leverage than that, but its up to you how much you want to whack the legal stick.

This is all about utilizing and maximizing the procedural hurdles the contract grants you. You can use them or lose them!

[oregonpilot]

My case has been assigned to arbitration by and with the local court in Oregon. I have been advised that this type of arbitraion is not in my best intrest. Reading all the threads explain how to initiate arbitration, but when aribtration is already assigned by the local court How can I change to JAMS or should and can I plead for a trial hearing with a judge. I had to turn in a stipulation to select arbitrators today I only know of 1 of the 5 local attorneys on the list he was mine at one time

[trueq]

including court ADR! Alternative dispute Resolution (ADR) is not the same thing as the private contract dispute forum arbitration we talk about in this thread.

Instead of selection an ADR arbitrator in your court system...send them this letter and/OR initiate with JAMS:

http://www.debt-consolidation-credit...0&postcount=11

You want to be specific...you are demanding contractual arbitration, not "court system ADR". Refer to the court arbitration as "court system ADR". The contractual arbitration clause overides "court system ADR."

Here's the arbitration scoreboard (not court system ADR)

http://www.debt-consolidation-credit...ght=scoreboard

[Baggins]

Even after I had initiated arbitration the OC's local counsel refused to motion for the req'd stay. I was the one that got the judge to stay the case by banging on the clerks door "re-quoting" the Federal Arb Act and our state's arbitration statutes since apparantly not many on legal hill appear to read the court docs that actually get filed by the consumer. The game they were playing was the renta-legals would claim it had to be handled via the OC direct and the OC would want the local counsel involved, this was a post-suit arb. initiation. It's all good though. I've already beaten one of these type of jerks in open court, currently in settlement negotiation with another that will net me some green money, and approaching the table against another scum of the biz that am not gonna cut any breaks to, what they did was nie-unforgiveable.

[goodguy2]

Originally Posted by trueq

This is the post-lawsuit arbitration exercise map.

Arbitration exercise can waive your opponent from court AFTER they sue you.

First things first, What is an arbitration exercise? Its notice to the other side. Here's an example:

http://www.debt-consolidation-credit...0&postcount=11

When you do this you will get 1 of 4 reactions from lawyer:

1.) They will ignore and keep litigating, which violates your FDCPA rights. You need to bring a MTD or MTC arbitration to set them straight.

2.) They will acknowledge and ask court for a stay of the case pending outcome of arbitration.

3.) They will react with scorn and rage!!!! They will try to quickly jam an SJ down your throat, send you massive discovery, anything to get you to "play along" with litigation to show that you were not serious about arbitration. They may even lie, cheat, and steal. I had 1 lawyer deny existence of arbitration clause even when judge had it in front of them and their affiant said that was the agreement!!!! I'm suing this lawyer...

4.) They will just dismiss and surrender. http://www.debt-consolidation-credit...75&postcount=8 20 minutes in front of trial on a 5 figure credit card!


#4 you should never argue with. "Without prejudice is OK" because your arbitration exercise, in the context of waiving their litigation rights, survives dismissal. If they sue again, lawyer violated FDCPA (See pre-lawsuit arbitration exercise for this point.)

#1 and #3 require action on your part. You need to bring a MTD or a MTC arbitration against scumbag. You need to draw up motion and call court clerk to get a date to hear motion. Judge is obligated to grant the motion under Federal Arbitration Act. Here are the issues you need to argue and deal with at such a hearing: Post #2 http://www.debt-consolidation-credit...ght=initiation

#2 Just insist that the "certified professional" bar lawyer initiate the arbitration. See all the problems this causes in the Pre-lawsuit post above!

MAIN KEY: Get judge to order OC/Debt collector to initiate arbitration.

There is an emerging 5th option, which was posted from GA today. ZWICKER AND ASSOCIATES IS TRYING TO STRIKE THE AMEX ARBITRATION CLAUSE IN THE CASE. See my post on how to deal with this. This will really extend the lawsuit timeline! http://www.debt-consolidation-credit...d.php?t=299148

THERE IS ALSO AN ULTIMATE CAUTION: YOU CAN WAIT TOO LONG TO EXERCISE YOUR ARBITRATION OPTION! In my state you can waive your right to arbitrate by participating in discovery or a pre-trial conference...so don't wait forever. However, in other states, like CO you can do it 20 minutes before trial! There is no solid test, so be careful about putting this option off. Its like a DV, use it or lose it!

Now in a perfect world judge ordering scumbag to initiate his own claim in arbitration would be great, but some judges will give consumer 30 or 60 days to literally initiate arbitration against themselves!

While this sounds dumb (and it is), it is not the end of the world. You can make lemonade from the lemon judge's ruling to make you initiate the arbitration.

Up until this point you are only dealing with the court. At this point you cut the court action off and head for the arbitration forum.

Post #3 from me will be the arbitration process itself.

EXCELLENT!

[GH0104]

Excellent work as always, Trueq!

[trueq]

WOW, we have had some amazing legal experiences the past 8 months with this arbitration thing.

Here are some important consumer learnings in this evolving legal field:

LEARNING #1: AAA will allow creditor/JDB INITITATE the credit card arbitration if the creditor/jdb is under court order to initiate. However, AAA is still formally refusing arbitrations from crediotr/JDB for credit cards without court order...WHICH STRENGTHENS THE IMPORTANCE OF PUTTING ARBITRATION EXERCISE IN YOUR DV BEFORE LAWSUIT! (see pre suit post above)

LEARNING #2: JAMS will take counterclaim, (meaning it will accept filing) for creditor/jdb debt if you initiate a JAMS arbitration against creditor/JDB. We also got word that JAMS will accept creditor/JDB initiations, but very few will want to do that because JAMS is moocho expensive for creditor! I did not get chance to test Jay Welsh defense against the JAMS jurisdiction of debt collection claims because my case was mutually dismissed before any merits or motions were argued. (I walked on, allegedly, six figures of debt filed in counterclaim by this OC.) So try to use the Jay Welsh statement, to deny JAMS jurisdiction for any claim filed against consumer!!!! You only want your claims considered if possible!
(If JAMS does render a debt collection arbitration award, that would make Jay Welsh's statement to FTC untrue....which some bright lawyer could take him to the woodshed on.)

LEARNING #3: ARBITRATION OFFENSE! MG05 is the one who was smart enough to realize this. I was just thinking defense, like a goober. ARBITRATION IS A TREMENDOUS OFFENSIVE CONSUMER WEAPON! I argued with MG05 for weeks and he finally convinced me. This issue arose when some Maybury judges in court would actually deny consumers the right to the contractual arbitration! His solution was to take the offense and initiate! Initiating really ties the judge from denying your right to arbitrate. This "challenge" led to the following discussion:

LEARNING #4: PREEMPTIVE ARBITRATION! Again MG05 deserves the credit. Arbitrating against OC/JDB before they sue you! The financial hurdle is tremendous in arbitration. $3000 in JAMS fees just to get started, paid by non consumer party. Many fold rather than pay money to face your claim and attempt to countercliam for the debt! I did this 3 weeks ago and the creditor lawyer called me completely confused. I had to point him to JAMS web site and told him I would sue to compel his client to pay the fees if they don't pay. JDB Lawyer was shocked I could pile such a big JAMS fee burden on his client so quickly and take away his right to litigate at same time! Read MG05 on this.

LEARNING #5: PREEMPTIVE ARBITRATION to delete credit report tradelines! This discussion arose 2 months ago. Some have done, including me. some have gotten instant deletion. If you are a creditor...do you want to pay $3000 in JAMS fees to defend one tradeline to start? Hell no. Want to get rid of stubborn tradeline? File an arbitration! I filed one 3 weeks ago against Chase. Named all 3 CRA's. 1 CRA attorney was livid for being named. I'm now on "special" list with all 3 CRA's, my disputes go directly to lawyer, not some minimum wage goober!

Reportedly, we had one arbitration "loss" posted on this board with citifinancial, but we believe its a troll to scare us from this strategy. The timeline was also very suspicious.

I received a story that another consumer took an OC all the way to a full hearing in JAMS, but only lost on the principal of the debt. The interest, legal fees, arbitration fees, and other junk fees were all DENIED BY ARBITRATOR! Consumer wrote a small check to OC lawyer at the end of the arbitration hearing and walked out. OC lawyer wanted 22 times the award amount for legal fees they spent ...MOTION DENIED! (This is a bank getting bailout money from federal government!) So in a technical sense this consumer lost, but won in the end. This consumer took OC to the woodshed on expense!!!!! Also, even though they lost...there was no judgment to show for it. Arbitration awards are not reported on credit report and if they are "satisfied" there is no reason to confirm them in court as judgments.

That arbitration award is a damn side better that what would have happned in 95% of the courtrooms in this country. Arbitrators know about NAF fallout. I believe many of them don't want to be perceived as abusing consumers!

MG05 or other consumers, please feel free to update this thread with ideas I'm missing.

The options are enormous, its hard to write it all down!

[Bradly1]

CC Agreement states that if they Initiate they will choose an Arbitration Forum, however, they will send notice and they will switch to the Administrator of your choice if you respond in 15 days. So you can always funnel it back into JAMS.

So if you end up Compeling them into Initiation you will still have all the JAMS expences and Trueq's experience to help you through it, NAF and AAA just not an option if consumer wants JAMS per the CC Agreement.

[trueq]

The only way Cap1 can choose someone other than JAMS is WHEN THEY ARE UNDER COURT ORDER TO INITIATE THE ARBITRATION, THEY COULD CHOOSE AAA, but as you said...

You can change administrator back to JAMS with notice to Cap1 within 15 days.

Just another excellent procedure issue to throw at them!

[SeaStriper]

Now in small claims Trueq should u MTD before going to court or just wait for the "hearing/Trial" to ask for the dismissal on that date and waste there "capital one/attorney" money if they dare to show. I don't mind taking the hour off to show the court I initiated and waste there $$$ and attorney time. Your suggestion would be valued

[chuckygee]

Check out this link for cost in JAMS

Consumer disputes

[jkg3]

Originally Posted by chuckygee

Check out this like for cost in JAMS

Consumer disputes

7/6/2005 Claimant vs. Chase Manhattan Bank
Total Fees: $34,087.50
100% paid by Chase

[tovforjesus]

thank you so much for alll this info.

[SeaStriper]

My case "Dismissed" in court today by crap1 attorney Not over til I say it's over CRAP1...The boxing match and fight has just begun!

SeaStriper fights back woo hooo

[idahospud]

I have a question about using arbitration. I have a Chase account that I stopped paying on around July 2008. It initially went to Fred Hanna and they initiated arbitration through NAF. This was in the early summer of 2009. I submitted a response saying that I refused arbitration. It was dismissed from that arbitration case (I'm assuming because that was about the time NAF was required to stop doing arbitration.) This account is now with an attorney in Idaho, which is where I live. I received the first letter from the attorney and responded with debt validation request. They sent me copies of my account statements back to about 2003 and also a letter saying they intended to pursue legal action. Prior to that time the account was Bank One. I have not received a summons yet but a search of cases filed in the state of Idaho turmed up a case filed against me. It said the summons was issued on 3/25/2010 and was returned to plaintiff for service that same date. I'm assuming this means the attorney is to arrange for me to be served. My question is, since I refused arbitration when it was with Fred Hanna, can I now request arbitration at this time to avoid a court case? Thanks for your help!!