NEW YORK (AP) — JPMorgan Chase is dropping a clause from its credit card contracts that required disputes with customers to be handled through binding arbitration.
The move opens the door for customers to potentially bring class-action and other lawsuits.
A spokesman for the New York-based bank's Chase Card Services Unit confirmed the change Friday, after a law firm that sued over the old policy announced a tentative settlement.
The spokesman, Paul Hartwick, says Chase decided to stop sending credit-card disputes to arbitration in July, and now is removing the arbitration clause. Bank of America took a similar step three months ago.
Banks say arbitration is less costly for everyone than lawsuits. But consumer groups have criticized the practice as tilted in favor of banks.
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