Nine Republican state treasurers are calling on the Securities and Exchange Commission to reject mandatory arbitration settlements for disputes between companies and their shareholders, underscoring a split in the GOP over the issue.
Private lawsuits are crucial for protecting consumers and resolving disputes without government intervention, the group says.
“Plaintiffs lawyers and consumer advocates seem increasingly concerned that sometime soon, whether it’s through a corporate charter provision in an IPO or via a bylaw change for an already-public company, a public corporation is going to attempt to impose mandatory arbitration on its shareholders.”