Committee advances bill to limit cross‑entity arbitration clauses in consumer contracts
A 53 22, advanced May 15, would prevent arbitration agreements with one part of a corporation from being applied automatically to other corporate arms. Proponent Adam Letterman cited McGinty v. Uber; the committee released the bill with a recorded no vote from one member concerned about business competitiveness.
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The Consumer Affairs Committee voted May 15 to release Assembly Bill A 53 22, legislation that would restrict the ability of corporations to extend an arbitration agreement signed with one corporate arm to other related companies. The committee heard proponent testimony from Adam Letterman, president of the New Jersey Association for Justice, who said the bill would protect consumers who unknowingly sign arbitration agreements through apps or streaming services and would ensure arbitration clauses apply only to the specific corporate entity the consumer contracted with.
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