Notes from the hearing on HB2696 by State Representative Dan Gattis concerning mandatory binding arbitration:
Gattis lays out the bill. Gattis claims this does not bar the use of arbitration, in fact it protects the parties rights to arbitration. Arbitrator will be required to be qualified. State Bar task force, which Gattis was a member of recommended changes to the Texas arbitration act. Claims there is no opposition to the bill. (Might have been a joke)
Janet Ahmad is up. President of Homeowners for Better Building. Speaking about home construction. Builders use it as a weapon. As long as they have MBA, consumers lose. Warranties also have MBA. Credit card arbitration wins for the banks 99.3% of the time. MBA works with business to business.
Wayne Caswell of Homeowners of Texas. For, but not testifying.
Pamela Bolton of Texas Watch. There is no qualification for arbitrators in Texas. Anyone can be an arbitrator even with no legal qualifications. Consumers have no legal right to appeal a forced arbitration, but business does.
Tom Archer of Homeowners of Texas. Refers to a graphic. Provided by John Cobarruvias. Shows that the community of the Woodlands that shows every builder has a MBA clause and that all the warranties have MBA clauses also. So if you want to buy a new home, you have to sign this clause. None of the contracts allows a homeowner to opt out of the arbitration. There really is no "choice". Talks about the 7th amendment of the Constitution that provides protection for consumers. Talks of his cell phone company that just notified him of a BMA clause. This is a restriction of trade. Federal arbitration laws allow the State to allow a choice, but cannot abolish the use of arbitration.
Mike Shlick(?). Attorney in private practice. He profits from arbitration as an arbitrator. He uses the same arguments that the because of the Federal regulation, the State cannot do anything about the use of MBA. Much like immigration, I guess. Claims that if arbitration can be "fixed" everyone would be happy. That is not true. The problem is that arbitration is being forced upon home buyers. It is not a choice.
John Allan Chalk. Against. He is a private lawyer. He makes money from arbitration. He represents "both" parties in arbitration. (We hear that alot) Again, he will not address the fact that arbitration is forced upon consumers. blah blah blah. Claims consumers will fair worse if arbitration is not forced upon them. blah blah blah.
Lee Parsley. Against. OH GOSH! He is from Texans for Lawsuit Reform, the ass kisser of business. No doubt they will be for denying rights to consumers. blah blah blah. The chair interrupts the TLR ass kisser. He has trouble getting his lips off of the committees ass.
James Johnson. Against. An attorney. Makes money off of arbitration. Claims the consumer was better off in all of his arbitrations. Imagine that! blah blah blah. Stumbles. Claims he doesnt know anything about homeowners arbitration. Still claims it is fair, at least in his opinion. Asked if his opinions are public record. No. It is secret. So what he is saying is crap. He doesn't have any answers for tough questions.
Jason Doulett(sp?). Against. Claims federal law preempts a far arbitration bill like HB2696. Works with employment arbitrations. Someone questioning him about preemption about State law and Federal law. He begins reading off a legal matter. He is getting grilled. Rightfully so. He is dancing around. He is only a specialist on employment, but still offers his unqualified opinion on something he doesn't know about. Asks about the Constitution and the 7th amendment. Claims the Federal Arbitration Act can prempt the Constitution. Wow this guy sucks. Now he claims the FAA may not prempt the Constitution. He is all over the map on this issue. He has confused the situation instead of clearing it up.
Someone. I missed his name. And can't figure out what the hell he is saying. Admits that the Federal Government can override Texas lawmakers if they choose to stop MBA.
Abel Martinez. Neutral. HEB person. Probably on employment issues. No questions. Not sure what he was there for.
Dan Worthington. For the bill. Texas Association for Defense Counsel. Great testimony. If you are going to give up your rights to the Constitution, you should be given fair warning. Not too radical of an approach.
End of hearing. Gattis says he believes in the civil justice system. He believes arbitration is a secret process and we cant make rules because of this secrecy.