This is an admittedly very long post, but please read it all because it is quite interesting! I really want to start a discussion on this topic!
I just finished watching an interesting new HBO documentary called, “Hot Coffee.” Though part misguided, left-wing, anti-capitalist, propagandistic harangue, there is some interesting information in it. The film derives its title from the case of Shiela Liebeck, the 81 year-old woman who sued MacDonald’s after having spilt extremely hot coffee on herself. It talks about how large corporations, under the guise of pushing for “tort reform,” do whatever they can to keep the public out of the courts and prevent them from litigating when the company is clearly responsible for something bad that has happened to the customer.
As I said, part of this is sheer left-wing, quasi-socialist nonsense (one activist and “expert” at the vomit-inducingly socialist sounding “Center for Justice and Democracy,” claims tort litigation is a right expressly delegated in the Constitution), but it does give legitimately interesting food-for-thought in some areas: for instance, did you know that the woman who spilled coffee on herself, suffered deeply serious burns on her thighs and actually required skin graft surgery? The pictures of her burns were indeed horrific. Liebeck was also not behind the wheel of a car at the time, as is often claimed. In fact, her nephew was at the wheel and she was in the passenger seat, but the car was parked in the MacDonald’s parking lot at the time anyway. Apparently, MacDonalds had received about 700 such complaints prior to Shiela Liebeck, and it was found that the particular restaurant from which the coffee originated had heated the water used in its coffee machines to about 180 degrees Fahrenheit, which was well above regulation-mandated temperature. I’m not saying by this that I agree with the regulation in question, or think that it should exist (I don’t), but I am simply presenting a fact of the case.
I’m also mentioning this because the movie does address, from a sort of power elite perspective, how corporations have attempted to manipulate consumers through the government and through the sponsoring of judges and politicians for elective office that vociferously decried “frivolous lawsuits,” as well as by a masterful propaganda and public relations campaign that has distorted the facts of particular cases, like the Liebeck case. The part about Karl Rove’s and “Dubya’s” machinations was particularly interesting.
But I want to concentrate most on the case of Jamie Leigh Jones, which the movie also talks about, and its implications for libertarian legal theory.
The movie uses her case to attack the libertarian position that companies and their customers should establish their relations clearly by way of contract, so that it is obvious who the guilty party is in any case of wrongdoing. The particular thing attacked is the existence of “mandatory arbitration” clauses in contracts, whereby the one who signs agrees not to take the company to trial publicly in the case of a dispute, but rather to settle the matter quietly with a private arbitration agency handpicked by the company itself. One economics professor from Emory University is interviewed voicing support for this view, and then the attack begins. It is said how these clauses are often written in miniscule print and that consumers very often don’t even know they’ve agreed to them. In some cases, such as with credit card and cell phone companies, the clause is not even included in the original contract but is then added on later in a booklet sent to the customer along with their bill, usually stating something to the effect that if they use the credit card or cell phone again, they have implicitly agreed to the mandatory arbitration provision (and whatever else is included there).
There’s a great deal of platitudinous claptrap about how companies “force” consumers to sign these contracts, but I question whether the anti-capitalist screed in the movie is warranted because it doesn’t seem to me that such a practice as the one described above would even be legal in a libertarian society. Though it certainly isn’t forceful, it surely seems fraudulent to add binding provisions to a contract after it has already been signed, unless there is a preexisting provision allowing for this sort of thing that the signatory was able to see before bestowing their consent on the arrangement.
Anyway, here is how Haliburton, with a “mandatory arbitration” clause, both literally and legally raped Jamie Leigh Jones.
At the age of 19, Jones, then never before having heard of a mandatory arbitration clause, signed an employment contract with KBR, then a subsidiary of Haliburton, in Huston, Texas to assist them with their operations in Iraq. By signing the contract, she had ceded her right to a public trial in the case of a dispute with Haliburton, and would have to seek redress from an arbitration agency picked by Haliburton in the way described. After a year of work with KBR, Jones went into Iraq. Told she would be housed in a trailer shared with two other female soldiers, she found on her arrival that she was placed in a predominantly male barrack. She expressed concerns about this to her manager, but says she was brushed aside and accused of overreacting. Four days after arriving, she says she was drugged and brutally gang-raped by her male Haliburton co-workers. After being drugged, she awoke naked, bleeding and badly bruised. After having a rape kit administered and sent to KBR/Haliburton, the rape kit was suddenly “lost” by the company. When word of the event got out, she was taken by some of her commanding officers and essentially locked and imprisoned in a shipping container. After some time, she was at last allowed to call her father, who then called his congressman, who demanded that Jones be rescued by federal agents. She tried to pursue a civil suit against the company, but the arbitration clause denied her this option. The company’s arbitration agency essentially decided that she could either continue to work there, or otherwise go back home and be contractually terminated.
Any thoughts? I’m not saying I agree with the film’s point, but you must admit, this is interesting. I’ll just say one last thing: the filmmaker’s absurdly naïve belief that “public” (i.e. gun-run) courts are staffed with justices who are paragons of virtue and objectivity; who could never be bribed, influenced, cajoled or manipulated to rule a certain way; who are simply morally pure and unsullied souls free from veniality, corruption or turpitude – all while being so absolutely cocksure that private firms performing the same function are, self-serving, biased and demonically prehensile syndicates with their own interests to look after - is pathetically and infuriatingly childish. I’ve met kids who are more cynical.