SCOTUS Rules Against Consumer Class Action Suits

Oh, great. The wingnut five continues to rubberstamp anything they can to give corporations the edge they need to pound us completely into the ground. We have no right to anything, other than the right to shut up and take it. This decision is a big

Oh, great. The wingnut five continues to rubberstamp anything they can to give corporations the edge they need to pound us completely into the ground. We have no right to anything, other than the right to shut up and take it. This decision is a big deal, further undercutting consumer protections:

WASHINGTON — The Supreme Court gave corporations a major win Wednesday, ruling in a 5-4 decision that companies can block their disgruntled customers from joining together in a class-action lawsuit. The ruling arose from a California lawsuit involving cellphones, but it will have a nationwide impact.

In the past, consumers who bought a product or a service had been free to join a class-action lawsuit if they were dissatisfied or felt they had been cheated. By combining these small claims, they could bring a major lawsuit against a corporation.

But in Wednesday's decision, the high court said that under the Federal Arbitration Act companies can force these disgruntled customers to arbitrate their complaints individually, not as part of a group. Consumer-rights advocates said this rule would spell the end for small claims involving products or services.

In the case before the court, a Southern California couple complained about a $30 charge involving their purchase of cellphone service from AT&T Mobility. The California courts said they were entitled to join with others in bringing a class-action claim against the cellphone company.

But the Supreme Court reversed that decision Wednesday in AT&T Mobility vs. Concepcion. Justice Antonin Scalia said companies may require buyers to sign arbitration agreements, and those agreements may preclude class-action claims. Chief Justice John G. Roberts Jr. and Justices Anthony Kennedy, Clarence Thomas and Samuel A. Alito Jr. formed the majority.

Scalia said companies like arbitration because it is efficient and less costly. "Arbitration is poorly suited to the higher stakes of class litigation," he said.

But the dissenters said a practical ban on class action would be unfair to cheated consumers. Justice Stephen G. Breyer said the California courts had insisted on permitting class-action claims, despite arbitration clauses that forbade them. Otherwise, he said, it would allow a company to "insulate" itself "from liability for its own frauds by deliberately cheating large numbers of consumers out of individually small sums of money."

Breyer added that a ban on class actions would prevent lawyers from representing clients for small claims. "What rational lawyer would have signed on to represent the Concepcions in litigation for the possibility of fees stemming from a $30.22 claim?" he wrote. Justices Ruth Bader Ginsburg, Sonia Sotomayor and Elena Kagan joined his dissent.

The court itself divided along partisan lines. All five Republican appointes formed the majority, and four Democratic appointees dissented.

DonationsTracker.com - Make a Donation to 2013 C&L Fundraiser

About Susie Madrak

Comments

We welcome relevant, respectful comments. Please refer to our Terms of Service for information on our posting policy.