Arbitration Agreements Could Shield Sheen from Lawsuits

As news broke that Charlie Sheen was HIV positive, it was also revealed that he had paid millions to settle claims filed by those who threatened to reveal his status. However, news reports also revealed that visitors to Sheen’s home were required to sign a confidentiality agreement that included an arbitration clause.

An arbitration clause, in any type of contract, requires an individual to settle a claim outside of court. During this session, an arbitrator is chosen by both parties, which means no jury will hear your story.

Arbitration agreements not only take away your legal right to file a lawsuit, they also limit or remove the possibility of punitive damages, which are awarded as a way to punish the defendant and deter them from other similar misbehavior in the future. Furthermore, an arbitration agreement would also serve as a way to keep the record of events from going public.

As previously noted by an investigation in the New York Times, arbitration agreements are being snuck into all types of agreements and contracts. From cellphone service to nursing homes admissions to workplace agreements, you may have already signed an arbitration clause without even knowing.

The ability of an actor to use an arbitration clause to silence those who may have been put in danger if he failed to disclose his HIV positive status illustrates how the legal system often works in favor of big corporations. According to the New York Times’ three-piece investigation on arbitration agreements, there were a number of instances where these clauses favored companies being sued for wrongful death, medical negligence and hate crimes.

As a leader in protecting the rights of the elderly, injury lawyers Milwaukee at Pitman, Kalkhoff, Sicula & Dentice, S.C. has seen the damage that arbitration clauses have wrought in cases of nursing home abuse and neglect. We encourage everyone to thoroughly read their contracts, admissions forms and other legal documents. If you do not understand something, ask questions and make sure your legal rights are protected.