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July 17, 2008 at 01:17 PM
Insurance industry officials are opposing a bill passed earlier this week by a House subcommittee that would abolish use of arbitration agreements in consumer, franchise and employment contracts.
The bill, H.R. 3010, the Fairness in Arbitration Act, passed the Subcommittee on Commercial and Administrative Law of the House Judiciary Committee Tuesday by a voice vote.
“As drafted, the bill is overly broad and appears to implicate contracts beyond those contracts it is purported to affect,” Marc Racicot, president of the American Insurance Association, Washington, wrote Monday in a letter asking the subcommittee not to act on the bill.
Enactment of H.R. 3010 would set a “dangerous precedent, one that would limit the use of arbitration and other alternative dispute resolution mechanisms to avoid costly and time consuming litigation,” Racicot wrote in the letter.
