The Supreme Court held that binding arbitration agreements between investors and investment firms:

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The Supreme Court has consistently held that binding arbitration agreements between investors and investment firms are legal. In 1987, the Supreme Court ruled in Shearson/American Express Inc. v. McMahon that such agreements did not violate the Securities Exchange Act or the Constitution. Although some argue that these agreements deprive investors of important legal protections, the Supreme Court has held that they are enforceable under the Federal Arbitration Act.

The Supreme Court Held That Binding Arbitration Agreements Between Investors