Consumer Contracts Posts
The draft of the American Law Institute’s Restatement of Consumer Contracts reflects the jurisdiction of the US courts on the ‘adoption’ (as the draft calls it) of standard contract terms into consumer contracts. This draft is of great value to European lawyers in understanding US developments, but it may also stimulate a reflection on the state and possible evolution of European legal systems.
The Restatement project presumes the exercise of nonpartisan judgment. Some criticisms of the draft are more political tracts than analytic critiques. Because the Draft does a good job analyzing and distilling the law, the real question in this debate is whether the ALI and the Restatement project as a whole can withstand efforts to use the tools and standards of retail politics to defeat the analytic approach of the Draft. To the extent such efforts succeed, the Restatement concept as a whole will fail.
In a recent episode from Consumer Finance Monitor Podcast, host Alan Kaplinsky interviews ALI Council member Steven O. Weise of Proskuer Rose about the criticism of the Restatement from businesses and consumer advocates.
Twenty-three State Attorneys General circulated a letter urging Members to withhold support from the Restatement of the Law, Consumer Contracts. The criticism expressed in the AGs’ letter is founded on a misunderstanding of the rules in the draft Restatement.
In this week’s podcast episode of Reasonably Speaking, consumer contract experts Omri Ben-Shahar and Florencia Marotta-Wurgler discuss several types of consumer contracts, enforceability of terms, and the potential consequences of agreeing to these terms without reading the fine print.
Last fall, the ALI Council approved Council Draft No. 5 of the Restatement of the Law, Consumer Contracts, for submission to the members at the ALI Annual Meeting in May 2019, subject to the discussion at the Council meeting and the usual editorial prerogatives. The Reporters are now working on the draft to be presented in May.
Empiricism and Privacy Policies in the Restatement of Consumer Contract Law and The Faulty Foundation of the Draft Restatement of Consumer ContractsSteven O. Weise
“Empiricism and Privacy Policies in the Restatement of Consumer Contract Law” (Empiricism) asks the wrong question and takes the wrong approach to answering that question. A second article in same issue of the Journal, “The Faulty Foundation of the Draft Restatement of Consumer Contracts” (Faulty Foundation) has similar flaws. Both articles misconceive and overstate the role of “counting” in the preparation of the Restatement, as the Reporters emphasize that the Restatement follows the traditional ALI approach, which is based on a broad review of court decisions.
During its meeting in New York City on October 18 and 19, the ALI Council reviewed drafts for seven Institute projects. Drafts or portions of drafts for six projects received Council approval, subject to the meeting discussion and to the usual prerogative to make nonsubstantive editorial improvements.
In the defining decision, Cullilane v. Uber Technologies, the First Circuit Court of Appeals reversed a district court’s grant of Uber Technologies’s motion to compel arbitration and dismiss the complaint of a putative class action brought by users of Uber’s ride-sharing service in the Boston area. At issue in the case was the enforceability of an online contract’s arbitration clause. This decision strongly reinforces the notion that online contract processes should be designed, and the information arranged, for consumers and with extreme attention to detail and a focus on clarity of meaning.
At its meeting in Philadelphia on January 18 and 19, the Council reviewed drafts for several projects, with the following outcomes: