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[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 3755 Introduced in Senate (IS)]

<DOC>

117th CONGRESS
  2d Session
                                S. 3755

To amend the Consumer Financial Protection Act of 2010 with respect to 
                              arbitration.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             March 3, 2022

   Mr. Brown (for himself, Mr. Schatz, Mr. Warnock, Ms. Warren, Mr. 
Menendez, Mr. Van Hollen, Mrs. Feinstein, Mr. Sanders, Mr. Markey, Mr. 
   Reed, Mr. Blumenthal, Mr. Padilla, Mr. Wyden, Mr. Whitehouse, Ms. 
 Hirono, Ms. Klobuchar, Ms. Cortez Masto, Mr. Durbin, Mr. Booker, Mr. 
 Casey, and Mrs. Gillibrand) introduced the following bill; which was 
read twice and referred to the Committee on Banking, Housing, and Urban 
                                Affairs

_______________________________________________________________________

                                 A BILL

 
To amend the Consumer Financial Protection Act of 2010 with respect to 
                              arbitration.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Arbitration Fairness for Consumers 
Act''.

SEC. 2. PURPOSES.

    The purposes of this Act are to--
            (1) prohibit predispute arbitration agreements that force 
        arbitration of a future consumer financial product or service 
        dispute; and
            (2) prohibit agreements and practices that interfere with 
        the right of consumers to participate in a joint, class, or 
        collective action related to a consumer financial product or 
        service dispute.

SEC. 3. NO VALIDITY OR ENFORCEABILITY OF PREDISPUTE ARBITRATION 
              AGREEMENTS OR JOINT-ACTION WAIVERS.

    (a) In General.--Subtitle C of the Consumer Financial Protection 
Act of 2010 (12 U.S.C. 5531 et seq.) is amended by inserting after 
section 1036 (12 U.S.C. 5536) the following:

``SEC. 1036A. NO VALIDITY OR ENFORCEABILITY OF PREDISPUTE ARBITRATION 
              AGREEMENTS OR JOINT-ACTION WAIVERS.

    ``(a) Definitions.--In this section:
            ``(1) Class action.--The term `class action' means a 
        lawsuit in which 1 or more parties seek or obtain class 
        treatment pursuant to rule 23 of the Federal Rules of Civil 
        Procedure or a comparable rule or provision of State law.
            ``(2) Consumer dispute.--The term `consumer dispute' means 
        a dispute relating to a consumer financial product or service 
        between--
                    ``(A) a consumer, including a consumer who seeks 
                certification as a class under rule 23 of the Federal 
                Rules of Civil Procedure or a comparable rule or 
                provision of State law; and
                    ``(B) a covered person.
            ``(3) Predispute arbitration agreement.--The term 
        `predispute arbitration agreement' means an agreement to 
        arbitrate a consumer dispute that has not yet arisen at the 
        time of the making of the agreement.
            ``(4) Predispute joint-action waiver.--The term `predispute 
        joint-action waiver' means an agreement, whether or not part of 
        a predispute arbitration agreement, that would prohibit, or 
        waive the right of, one of the parties to the agreement to 
        participate in a joint, class, or collective action in a 
        judicial, arbitral, administrative, or other forum, concerning 
        a consumer dispute that has not yet arisen at the time of the 
        making of the agreement.
    ``(b) No Validity or Enforceability of Predispute Arbitration 
Agreements or Joint-Action Waivers.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, no predispute arbitration agreement or predispute joint-
        action waiver shall be valid or enforceable with respect to a 
        consumer dispute.
            ``(2) Applicability.--
                    ``(A) In general.--An issue as to whether this 
                section applies with respect to a consumer dispute 
                shall be determined under Federal law.
                    ``(B) Determination.--The applicability of this 
                section to an agreement to arbitrate and the validity 
                and enforceability of an agreement to which this 
                section applies shall be determined by a court, rather 
                than an arbitrator, irrespective of--
                            ``(i) whether the party resisting 
                        arbitration challenges the arbitration 
                        agreement specifically or in conjunction with 
                        other terms of the contract containing the 
                        agreement; and
                            ``(ii) whether the agreement purports to 
                        delegate such determinations to an 
                        arbitrator.''.
    (b) Technical and Conforming Amendments.--The table of contents for 
the Dodd-Frank Wall Street Reform and Consumer Protection Act (Public 
Law 111-203; 124 Stat. 1376) is amended by inserting after the item 
relating to section 1036 the following:

``Sec. 1036A. No validity or enforceability of predispute arbitration 
                            agreements or joint-action waivers.''.

SEC. 4. APPLICABILITY.

    This Act, and the amendments made by this Act, shall apply with 
respect to any consumer dispute or claim that arises or accrues on or 
after the date of enactment of this Act.
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