updated 11/20/2009 4:14:09 PM ET 2009-11-20T21:14:09

JPMorgan Chase & Co. dropped a clause from its credit card contracts that required disputes with customers to be handled through binding arbitration.

The move opened 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, said Chase decided to stop sending credit-card disputes to arbitration in July, and removed the arbitration clause. Bank of America took a similar step three months ago.

Banks have said arbitration was less costly for everyone than lawsuits. But consumer groups criticized the practice as tilted in favor of banks.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 4.71%
$30K home equity loan FICO 5.26%
$75K home equity loan FICO 4.70%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.42%
13.42%
Cash Back Cards 17.94%
17.94%
Rewards Cards 17.14%
17.14%
Source: Bankrate.com