Legislation introduced Thursday in both chambers of Congress would end Amtrak’s forced-arbitration policy that bars passengers and their families from suing the railroad if they are injured or killed in crashes.
The legislation is among several efforts to pressure America’s passenger railroad to restore the legal rights of Amtrak passengers and their families to bring any disputes against the company before a judge or jury. The nonprofit Public Citizen filed a lawsuit in January calling the arbitration clause “unconstitutional” and seeking it be removed from the company’s ticketing terms and conditions.
The policy states it is “intended to be as broad as legally permissible” and applies not only to individuals who buy tickets but also family members and other passengers, including minors, for whom tickets are purchased. Lawmakers and consumer advocates say the clause means all sorts of disputes, from discrimination cases to wrongful-death claims, are subjected to close-door arbitration processes that generally favor the company.
“Amtrak’s current forced arbitration and class-action ban policy is simply unfair,” said Sen. Richard Blumenthal (D-Conn.), who filed the Ending Passenger Rail Forced Arbitration Act Thursday, saying the legislation would “ensure the traveling public is legally protected.”
“Riders unwittingly sign away vital legal rights with the purchase of a ticket. If the worst happens, they are left without legal recourse. This is unacceptable. We must restore consumers’ access to justice and public accountability,” Blumenthal said in a statement.
Amtrak defended its program, saying in a statement Thursday it “provides a resolution for our customers in less time — generally well within a year of filing — by avoiding unnecessary discovery and other time-consuming proceedings, and the often years-long wait for a trial date on overcrowded court dockets."
The company said it uses the American Arbitration Association as its arbitration forum and “claimants can choose a location from convenient venues throughout the country, are entitled to legal representation, and the arbitrator can award damages and all other relief available under applicable law.”
The Senate bill is sponsored by 11 other Democrats and Sen. Bernie Sanders (I-Vt.), who is also running for president.
Reps. Conor Lamb (D-Pa.) and Denny Heck (D-Wash.) introduced the House version.
Heck, who represents the area where a train derailed onto a busy Interstate 5, south of Tacoma, Wash., in December 2017, said victims of such crashes deserve a right to court after enduring so much pain and suffering. Three passengers were ejected from Train 501 and killed, and 57 more aboard the train were injured in that incident.
“Amtrak should be running toward its responsibility to ensure safe rail travel, instead of hiding behind an arbitration clause,” Heck said. “Victims deserve their day in court, and this bill will ensure they get it.”
Amtrak has said it implemented the arbitration agreement in January 2019, after determining that resolving passenger claims through arbitration would improve customers’ experience and reduce the cost of litigation. In a court document filed last week requesting dismissal of the Public Citizen lawsuit, Amtrak defended its policy saying it is within its authority to mandate arbitration for ticket buyers and that “arbitration provides much faster resolution of claims, and much faster compensation to injured parties, than does the civil litigation system.”
Because Congress has provided that Amtrak should operate as a for-profit corporation, the company makes its case in the court filing that by statutory mandate Amtrak “must seek ways to reduce inefficiencies — such as spending on outside counsel to represent Amtrak with respect to passenger claims.”
The company said Congress has authorized Amtrak to “make and carry out appropriate agreements,” to operate like a for-profit company, a provision Amtrak says allows the railroad to create ticketing agreements and to include arbitration provisions.
The news last fall that Amtrak had implemented the forced-arbitration policy prompted objections from various industry and consumer advocacy groups, including the Rail Passengers Association, the American Association for Justice and Public Citizen. Democratic lawmakers sent a letter to Amtrak in November urging the company to reverse the measure.
Critics argue that the policy not only denies passengers the right to go to court, but the closed door-nature of forced arbitration also lacks transparency and may dissuade passengers and relatives from filing claims.
“This is particularly troubling in instances of major injury and fatality — removing the public’s ability to stay informed of issues that impact their health and safety,” a November letter signed by a dozen senators to Amtrak said. “As our national railroad, Amtrak has a responsibility to ensure the traveling public — including victims of crashes — have their day in court. We demand that Amtrak immediately eliminate this anti-consumer arbitration and class action policy.”
Forced arbitration is prohibited in the airline industry, and it is not as common in public transportation. But it is common practice in the private sector. As many as 60 million nonunion workers are bound by forced-arbitration clauses, according to the Economic Policy Institute.
In a news conference Thursday, Charles Gildersleeve, whose brother of Bob Gildersleeve was killed in a 2015 derailment outside of Philadelphia, said the legislation would ensure other families have the option to sue in future tragedies.
“It is my sincere hope that this bill will show Amtrak that the American public demands accountability for any and all wrongdoing,” said Gildersleeve, whose family sued Amtrak after the crash.
“Amtrak should not be able to hide behind the secrecy of forced arbitration when their actions have harmed or worse, killed someone,” Gildersleeve said. “We were at least able to hold Amtrak publicly accountable for this terrible atrocity. I believe all Americans should have that constitutional right.”
Passengers and survivors of the derailment outside of Philadelphia, which killed eight people and injured hundreds, won a $265 million court settlement.
Julia Duncan, senior director of government affairs at the American Association for Justice, said Amtrak’s policy is one of the broadest forced-arbitration and anti-consumer passenger clauses she has seen. Given that the company is a quasi-government entity that receives state and federal subsidies, it should have customer-friendly policies, she said.
“It is a terrible policy. It’s terrible for workers, it’s terrible for consumers, it is terrible for passengers,” Duncan said. “We hope that the legislation draws attention to the issue and either the legislation passes or Amtrak realizes that it was a mistake to adopt this policy and changes the policy.”