I'm sorry to hear that Charlie Sheen is HIV positive, just as most of us would have compassion for anyone we learned was facing a difficult medical condition. But there's a one-word lesson in it for the rest of us--and it's probably not the one you think.

HIs risky behavior, as he described on the Today show, was difficult to watch, with his talk of heavy drug use, prostitutes, and his admission that he'd had unprotected sex with at least two partners since his diagnosis.

Sheen claims he always revealed his condition ahead of time; the Hollywood gossip site TMZ says "several of Charlie's former partners" (see here and here) say they were "unaware of his status when they had interaction with him."

It's all a sordid story, it leads us to the single word in Sheen's story that matters for the rest of us--one that illustrates an important aspect of how the legal system works in disputes between big wealthy corporations and individuals versus people of less means.

That word is: arbitration.

According to published reports, all visitors to Sheen's home have been required to "sign a confidentiality agreement that requires those that want to make a claim to do so outside of the courts, settling in arbitration instead."

Set aside the weirdness of requiring anyone who comes to your home to sign an NDA. The arbitration provision takes cases out of the jury system, limits or removes the threat of punitive damages and--perhaps most important in the cases of people like Sheen--goes a long way toward keeping the record of events from becoming public.

As it happens, earlier this month the New York Times published a two-part series on the rise of arbitration clauses in contracts, and how they can stack the deck:

Over the last 10 years, thousands of businesses across the country -- from big corporations to storefront shops -- have used arbitration to create an alternate system of justice. There, rules tend to favor businesses, and judges and juries have been replaced by arbitrators who commonly consider the companies their clients, The Times found.

Piecing together the story on television, Sheen confirmed he'd paid "millions" to settle claims that would have revealed his status over the past several years.

Part of his impetus to make his announcement now, he said, was that a prostitute he'd hired photographed the contents of his medicine cabinet--including his antiretroviral drugs--and allegedly threatened to go public with the photos. (She did this, Sheen said, after he'd told her, "Thanks for your time, we're not going to see each other anymore.")

To butcher a phrase, one man's risky behavior leading to a potential lawsuit is another man's "shakedown," as Sheen called it. As a result, it would appear that this alleged prostitute's refusal to play by Sheen's rules is what prompted him to reveal his status on national television.

The irony? Four years ago, Sheen's lawyers complained about arbitration clauses when he sued  Warner Brothers for firing him from his hit television series, Two and a Half Men, arguing in court that requiring arbitration to settle disputes in contracts was "unconscionable."

A judge rejected his argument. Sheen wound up settling his case against the studio for a $25 million payout. 

Published on: Nov 17, 2015
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