The AAA® is a not-for-profit organization whose mission is to settle disputes as quickly as possible at the least expense. Many consumer contracts specify arbitration to resolve any disputes that arise between consumer and company. The AAA declines to administer arbitration demands for companies whose arbitration clauses contain violations of the AAA’s own protocols.
 
Arbitration is the out-of-court resolution of a dispute between parties to a contract (in this case, the consumer and a business or company) decided by an impartial third party (the arbitrator). 

Both arbitration and litigation (going to court) will end with a decision. However, they differ in many respects, notably that

  • Arbitration is faster and more cost effective than litigating in court. 
  • The parties select the decision maker, who will be a person with expertise in the consumer area. Litigating parties do not select their judge, who likely will not be an expert in the consumer field.
Reporting the Facts on AAA Consumer Arbitration
  • 55% of cases settle
  • 10% of cases go to award
  • 35% (withdrawn, administrative, or dismissed)
Settling Your Case

AAA consumer arbitration cases initiated by the consumer consistently settle 55% of the time. 

Because of this, the consumer:

  • Does not have to spend the time or the money going through the entire arbitration process.
  • Can move on relatively quickly.
  • Benefits monetarily without incurring lengthy attorney’s fees and a potentially emotional procedure.
Going to Award

10% of AAA consumer arbitration cases initiated by a consumer proceed through the arbitration process and result in an arbitrator award to the consumer.

  • Total Cases that went to Award: 2,389
  • # of Monetary Awards for the Consumer: 705 (30%)
  • Average Monetary Award for Consumer: $57,507


The smaller percentage of cases that go forward usually includes cases that companies feel they can win with their attorneys, financial advantage, and experience in the issues. In court, these same resources would be used against the consumer in the much more adversarial, formal, and lengthy process of litigation.

While consumers who proceed with the entire arbitration can win large payments, the cost of attorneys’ fees as well as time and effort must be factored in. Proceeding with arbitration, however, is definitely shorter and more successful for the consumer than going to court.

 
Data is for individual consumer filings closed and awarded from October 1, 2017 – September 30, 2022.