If you have a dispute with a company, and are bound by an arbitration clause, it seems like you have a $1,500 hammer to hit them with? (Assuming your agreement states that the company will front the fees).
What happens if the arbitrator decides the case against you? Do you owe that fee? Does this vary from one contract to another?
I'm not entirely sure they can agree to not front the fees without also potentially voiding arbitration. While money does mean a lot in court, there's a very strong sentiment that it should not be a barrier to entry. There's at least one case that went to appears where, when the plaintiff ran out of money and arbitration was canceled, the case was permitted into court:
https://cdn.ca9.uscourts.gov/datastore/opinions/2016/06/15/1...
* I'm not sure if you could pull a Thiel/Hulk Hogan thing to bankroll an arbitration swarm but if so, this could definitely get ugly for companies that misbehave.
It doesn't just have to be companies that misbehave. If you don't like your competitor, maybe you'll sponsor that $250 per user to allow their userbase to throw arbitrations at them.
You can burn your competitor down at a ratio of at least 1:5 if you do something like this. If you take some fees for every case you win or that ends up settling, the ratio will be far better than 1:5
The arbitration system as it stands is a tool that allows anyone with enough money and intention to smite any company by pulling together unhappy users and paying arbitration fees for them.
Arbitration is a tool, but it's totally unfair to say it's used by anyone else than the company choosing it.
I believe the amount varies state to state, but is generally over $1000
They can award fees, yes. Usually depends on a myriad of factors, much the same as the court uses when determining sanctions and fees.
Some arbitrators make over $1,000 per hour.
The agreement specifies the arbitrator you use. In this case, the fees are set by the arbitration company, not by any contract between the parties to the dispute. It's not a matter of "who picks up the fees"; there's one fee for the company and a different, much smaller fee for the complainant.
(Of course you could have a contract specify that one or the other party was responsible for the other's arbitration costs, but that's not happening here and seems unlikely in other areas.)