Opinion ID: 75978
Heading Depth: 4
Heading Rank: 3

Heading: McMahon Factor Three: The MMWA's Underlying Purposes

Text: 26 The last McMahon factor requires us to examine the purposes of the MMWA to determine whether the MMWA and the FAA conflict. See McMahon, 482 U.S. at 226-27, 107 S.Ct. at 2337-38. The MMWA expressly states three purposes: to improve the adequacy of information available to consumers, prevent deception, and improve competition in the marketing of consumer products. 15 U.S.C. § 2302(a). These purposes are not in conflict with the FAA. In fact, the Supreme Court has repeatedly enforced arbitration of statutory claims where the underlying purpose of the statutes is to protect and inform consumers. See, e.g., Basic Inc. v. Levinson, 485 U.S. 224, 234, 108 S.Ct. 978, 985, 99 L.Ed.2d 194 (1988) (stating that a fundamental purpose of the Securities Acts is the disclosure of information to potential investors); Rodriguez de Quijas, 490 U.S. at 485-86, 109 S.Ct. at 1922 (holding that parties may arbitrate Securities Act of 1933 claims); McMahon, 482 U.S. at 242, 107 S.Ct. at 2345 (holding that parties may arbitrate Securities Exchange Act of 1934 claims). [E]ven claims arising under a statute designed to further important social policies may be arbitrated because so long as the prospective litigant effectively may vindicate [his or her] statutory cause of action in the arbitral forum, the statute serves its function. Green Tree Fin. Corp.-Ala. v. Randolph, 531 U.S. 79, 90, 121 S.Ct. 513, 521, 148 L.Ed.2d 373 (2000) (citations omitted) (holding that parties may arbitrate Truth in Lending Act claims). Consumers can adequately vindicate their rights arising under the MMWA and written warranties in an arbitral forum. See Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 280, 115 S.Ct. 834, 842, 130 L.Ed.2d 753 (1995) (Congress, when enacting [the FAA], had the needs of consumers ... in mind.). Thus, we conclude that the MMWA's consumer protection goals do not conflict with the FAA. 27 The MMWA's legislative history also indicates that Congress was concerned with addressing the unequal bargaining power between warrantors and consumers with the enactment of the MMWA, thus creating another possible purpose. 5 Unequal bargaining power alone, however, is not a sufficient reason to never enforce an arbitration agreement of a statutory claim. Gilmer, 500 U.S. at 33, 111 S.Ct. at 1655 (stating that [m]ere inequality in bargaining power, however, is not a sufficient reason to hold that arbitration agreements are never enforceable...). Inequality in bargaining power is a procedural question that courts should analyze on a case by case basis. Id.; see also McMahon, 482 U.S. at 230-31, 107 S.Ct. at 2339-40. Thus, unequal bargaining power, like the three declared purposes of the MMWA, does not create such a conflict with the FAA so as to prohibit binding arbitration of MMWA claims.