U.S. Supreme Court Issues Monumental Decision in AT&T Mobility v. Concepcion That Could Spell The End For Consumer Class Action Lawsuits In The U.S.
The United States Supreme Court (by a divided 5-4 vote) has dealt a potentially devasting blow to consumer class action lawsuits in the United States in an opinion it issued in a class action lawsuit filed against AT&T Mobility, styled AT&T Mobility LLC v. Concepcion, effectively ruling that federal arbitration law (“Federal Arbitration Act” or “FAA”) enacted to encourage arbitration of disputes trumps state consumer protection laws that have held such arbitration provisions unconscionable because they allow companies to deliberately cheat large numbers of consumers out of small amounts of money by shielding themselves from being sued through class action lawsuit waivers, according to the AT&T Mobility LLC v. Concepcion decision.
Vanderbilt law professor Brian Fitzpatrick wrote about the potential devasting consquences to consumers, employees and shareholders if the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion were to go AT&T’s way:
If the court goes down AT&T’s path, the consequences could be staggering. It could be the end of class action litigation. In light of Supreme Court decisions in the 1990s that made it difficult to certify personal-injury class actions, virtually all class actions today occur between parties who are in transactional relationships with one another: shareholders and corporations, consumers and merchants, employees and employers. Because they are in transactional relationships, they are able to enter arbitration agreements with class action waivers.
Once given the green light, it is hard to imagine any company would not want its shareholders, consumers and employees to agree to such provisions.
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