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American Arbitration Association (AAA) Automobile Industry Special Binding Arbitration Program
The Consolidated Appropriations Act of 2010 (Public Law 111-117), signed into law by President Obama, includes a provision under which owners of automobile dealerships can use a binding arbitration process administered by the American Arbitration Association to seek reinstatement if their businesses were closed by automobile manufacturers during the implementation of the Emergency Economic Stabilization Act of 2008. The new law provides a 180-day period for dealerships, manufacturers, and independent arbitrators to conclude dealership claims that their sales-and-service franchises should be restored by their respective manufacturers. The American Arbitration Association will provide the forum for administration of the arbitrations, according to the legislation. A summary of some of the legislatively required features of the arbitration include: • The arbitration must be elected by dealerships within 40 days of the date of enactment of the legislation. As a result, dealerships must commence arbitration by January 25, 2010. In addition, the entire dispute must be submitted to the arbitrator within 180 days of enactment of the legislation, or by June 14, 2010. • The manufacturer and dealership will be permitted to present all relevant information during the arbitration, and the legislation requires that arbitrators consider specific factual matters, among others, such as the dealership's profitability, the manufacturers overall business plan, the dealership's economic viability, whether the dealership met performance objectives in its franchise agreement, and the dealership's experience and length of service. • Arbitrators will be selected from a list of qualified arbitrators which will be maintained by regional offices of the AAA in the region where the dealership is located. The arbitration will take place in the state where the dealership is located. Electronic and telephonic hearings will be permitted. • Discovery will be limited to requests for documents specific to the dealership, and no depositions will be permitted. • Parties will be responsible for their own expenses, fees and costs and shall share equally all other arbitration costs such as arbitrator fees, meeting room charges, and administrative costs. The arbitration will be conducted in the state where the dealership is located. • The appointed arbitrator will determine if a covered dealership should be added to the covered network of the covered manufacturer. Arbitrators have no authority to award compensatory, punitive, or exemplary damages. Arbitrations will be administered pursuant to the AAA's Commercial Arbitration Rules, however all provisions of the legislation that are inconsistent with the Commercial Rules shall trump the Commercial Rules. For more specific information about the arbitration process and the requirements of the legislation, click on the links below captioned "Excerpt from the Bill -- Text Pertaining to AAA Arbitration (H. R. 3288-186)" and "AAA Commercial Arbitration Rules."
Tel:
888-899-9301 American Arbitration Association
Tel:
877-528-0880 For general inquiries, contact Customer Service at 800-778-7879. | |||||||||||||||||||||||||||||||||||||||||||||
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