JPMorgan Chase, the banking behemoth that provides credit cards to thousands of Americans, sent an email to many of its customers on Friday which seeks to strip those customers of most of their rights to sue the bank if the bank violates the law. Though the email gives those customers the ability to opt out of this effort to strip away their rights, the instructions on how to do so are buried deep in the email — deep enough that the bank likely hopes that no one will read that far.

The subject of the email is “Important information regarding changes to your Chase account.” A copy of this email was forwarded to ThinkProgress by a Chase customer who received it.

Forced arbitration

The relevant portions of the email concern forced arbitration, an abusive practice largely invented by conservatives on the Supreme Court.


Beginning in the 1980s, the Supreme Court began to rewrite the Federal Arbitration Act of 1925 — a statute that, in Justice Ruth Bader Ginsburg’s words, was intended to allow “merchants with relatively equal bargaining power” to resolve disputes through private arbitrators — to allow companies to force workers and consumers into a privatized arbitration system that favors corporate parties. This rewriting accelerated in the 21st century, with a series of 5-4 decisions that departed sharply from the Arbitration Act’s text.

The Act, for example, exempts “workers engaged in foreign or interstate commerce.” Nevertheless, in Circuit City v. Adams, the Supreme Court held that most workers engaged in foreign or interstate commerce may be forced into arbitration agreements.

Similarly, in AT&T Mobility v. Concepcion, the Supreme Court held that companies may force their customers to sign away their right to join a class action lawsuit as a condition of doing business for that company. More recently, in Epic Systems v. Lewis, a 5-4 court explained that workers can be forced to sign a forced arbitration agreement with a class action ban under pain of firing.

As a paper by the Economic Policy Institute’s Ross Eisenbrey explains, individual workers forced into arbitration are less likely to prevail before an arbitrator than they are before a real judge. And when they do prevail, they typically receive far less money.

Similarly, class action bans effectively allow companies to illegally take money from their workers or consumers with impunity, so long as they only take a little bit at a time.


Class actions allow multiple plaintiffs, who all share a similar grievance against the same defendant, to join together in a single lawsuit against that defendant. They are particularly important when a company engages in widespread, low-dollar lawbreaking against many individuals.

Suppose, for example, that a bank decides to illegally charge a $150 fee to each of its 100,000 credit card customers. Nearly none of these customers will sue the bank over a matter of only $150, because the cost of litigating such a case will exceed the amount of money at issue. So if the customers cannot join together in a class action, the bank will walk away with a cool $15 million ($150 * 100,000).

How to opt-out

The Chase email contains both a forced arbitration provision and a ban on class actions. It “provides that all disputes between you and Chase must be resolved by BINDING ARBITRATION,” and explicitly states that parties to the forced arbitration agreement “GIVE UP YOUR RIGHT TO GO TO COURT (except for matters that may be taken to a small claims court).” The email further provides that class actions “are not available under this agreement to arbitrate.”

Though the email does allow some claims to proceed in small claims court rather than before an arbitrator, it also provides that such claims must proceed “on an individual basis.” Thus, the email seeks to immunize Chase from class action litigation.

Significantly, however, the email also provides that customers may opt out of the forced arbitration provision and class action ban, but only if they comply with very specific instructions.

Can I (the customer) reject this agreement to arbitrate? Yes. You have the right to reject this agreement to arbitrate if you notify us no later than 8/9/2019. You must do so in writing by stating that you reject this agreement to arbitrate and include your name, account number, address and personal signature. Your notice must be mailed to us at P.O. Box 15298, Wilmington, DE 19850-5298. Rejection notices sent to any other address, or sent by electronic mail or communicated orally, will not be accepted or effective.

If you received this email, in other words, and do not wish to give up your rights to your credit card company, you must send a letter via snail mail to the P.O. Box listed above — and you must do so by early August.


Though it may be surprising that Chase allows people to opt-out of forced arbitration, the opt-out provision serves a very specific legal purpose. As Professor Charlotte Garden writes in a recent paper on forced arbitration, California law arguably permits courts to strike down forced arbitration provisions if that provision is imposed without choice. So it’s in a company’s interest to give customers a choice to opt-out — so long as the choice is buried where few people are likely to notice it.

As Garden explains, the delivery service Grubhub imposed a forced arbitration agreement on its drivers. Yet “only two delivery drivers of thousands had opted out of the [forced arbitration provision] during the months after Grubhub added its opt out clause.” Similarly, “only 270 drivers out of more than 160,000” opted out of Uber’s forced arbitration agreement. Thus, opt-out clauses help protect companies from a court decision invalidating a forced arbitration agreements, and they typically do so at virtually no cost to the company. Few people notice them. Fewer still probably understand them. So almost no one opts out.

Chase, however, cannot prevent members of the media from reporting on this abusive practice. Nor can it prevent any of its customers who read this column from invoking the opt-out provision.

Disclaimer: This column does not contain legal advice and does not create an attorney/client relationship. If you wish to obtain legal advice, consult your own lawyer.