AT&T

The U.S. Supreme Court enforces carriers' arbitration clauses

posted by Ken N. / Apr 29, 2011, 1:56 PM

The U.S. Supreme Court enforces carriers' arbitration clauses

If you're one of the few people who's actually read your wireless contract (or if you're a lawyer), then you know that there is an arbitration clause in your contract, forcing you to make complaints individually, rather than a class-action format. But some states, like Washington and California, have still allowed class-action suits, describing the arbitration clause as "unconscionable".

But the U.S. Supreme Court has ruled in favor of companies' right to force arbitration. The decision came from AT&T Mobility LLC v. Concepcion, in which the Concepcion family was charged sales tax on supposedly 'free' phones, and filed a class-action suit against AT&T. AT&T argued that the case should be dismissed because of the arbitration clause.

While the Concepcion family won in both California, and the Ninth Circuit Court, the Supreme Court ruled (5-4) that companies could enforce their arbitration clauses. That means that companies, like AT&T and other wireless carriers, will be able to confine customer dissent to individual arbitration, rather than class-action suits. While that means tremendous savings for carriers' legal departments, it also represents a loss of leverage for customers.

source: Ars Technica via Engadget

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3 Comments

1. JeffdaBeat unregistered

Ugh...stupid cell phone companies. Folks have to know what they are signing up for. This works out fanstically for the cell companies because people can't just opt into a lawsuit, they have to do it one at a time. Most will just take the charges and move on...sucks for the customer, but it's your signature...

posted on Apr 29, 2011, 4:08 PM 0

2. Sniggly

Posts: 7305; Member since: Dec 05, 2009

Lol. You can thank the government for the sales tax on a free item. And the family was fucking stupid to sue over it. They probably could have argued for a credit on their next bill instead.