[eek2121]

Arbitration costs companies far more than lawsuits do. There was a guy that used to make tons of money off Arbitration clauses. Basically, the company is on the hook for hotel stays, transportation, food, etc. for the arbiter as well as anyone else that may not be local to the venue in question.

The reason companies went with this approach was to stop class action lawsuits from happening, which is where the real damage happens. One enterprising law firm started doing pooled Arbitrations (filing for hundreds or thousands at a time), which costs the company more than a class action would. Some companies have removed such clauses because of this.