eBay Can Force Disputes into Small Claims Court

eBay added new language to its Arbitration Clause that gives it the power to quash a buyer or seller's arbitration claim and force the dispute to small-claims court instead. The new language is in Section 19 of the User Agreement ("Legal Disputes"), part B - "Agreement to Arbitrate" and states the following:

"If a party initiates an arbitration asserting a claim that falls within the jurisdiction of a small claims court, the other party may, in its discretion, require that the arbitration demand be withdrawn and that the claim be filed in small claims court. Any dispute about whether a claim falls within any given small claims court's jurisdiction will be resolved by that court, not by an arbitrator."

If a buyer or seller has a dispute with eBay, they currently have the choice of small claims court or arbitration (and those who opted out of eBay's mandatory arbitration clause have the option to file a lawsuit). 

A reader told EcommerceBytes that under the updated mandatory arbitration clause in the amended user agreement, not only can eBay unilaterally force a customer's arbitration dispute into small claims court at its sole discretion, the reader said the change was retroactive.

The impact is, in the reader's words, the following:

"Today: you can file a claim against eBay and it has to pay thousands for the arbitration and be required to cough up whatever documents the arbitrator requires so there is fairness to the proceeding.

"Tomorrow: eBay can evaluate your claim and decide nah, no arbitration, no document production that will help someone prove their claim, and people are forced into small claims court blind as to what defenses / documents eBay decides to use."

Arbitration isn't necessarily bad, but one organization says making it *mandatory* is discriminatory and unfair (link to Citizen.org). Small claims court isn't necessarily bad either - but taking away customers' right to choose may also be unfair. 

In light of eBay's new User Agreement, did mandatory arbitration clauses just get worse for eBay buyers and sellers?

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