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Nan Aron

Nan Aron

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AT&T Mobility v. Concepcion: The Corporate Court Does it Again

Posted: 04/29/11 11:46 AM ET

The Corporate Court is at it again. This time the case is AT&T Mobility v. Concepcion, and this week's 5-4 decision in favor of the cell-phone giant is yet another far-reaching betrayal of some of the most fundamental principles of American justice.

In this case, big business, with AT&T as its stalking horse, asked the Supreme Court to protect it from all those cheeky consumers and impudent employees who might have the temerity to complain that they're being ripped off or discriminated against. The ultra-conservative majority on the Court found a way to keep all those annoying individuals from banding together in group arbitration or in the courts, where they would have the benefit of lawyers and all those pesky constitutional rights and rules of civil procedure.

The result of the decision by Justices Scalia, Roberts, Thomas, Alito, and Kennedy is to make sure that when people like you enter the legal arena against a corporation, you go all by yourself into a system that's rigged against you.

Even if your name isn't Concepcion or you don't have an AT&T cell phone, this case is about you. Almost all of us operate in a world filled with employment agreements or corporate contracts for things like cell phones, credit cards, or online accounts. But if at some point you discover you've been cheated or your civil rights have been violated, you'll find that that you've signed away your ability to enter a courthouse to fight back. In this country, you can't buy a cell phone or take a job without agreeing to disempower yourself.

The culprit is right there in the fine-print or in the lengthy agreement you scroll through without reading before you click on the button that says, "I agree." The contract mandates that if the company does you wrong, you're absolutely forbidden to get together with others similarly harmed and sue in court or demand group arbitration. If you still want to complain, you have to submit to binding arbitration for your case alone. And who sets up the arbitration system? Why, the corporation, of course!

California had a rule that agreements that compel consumers or employees to give up their rights to form class actions are "unconscionable," and therefore invalid, when they protect companies that try to cheat lots of people out of small sums. The Supreme Court this week said that the Federal Arbitration Act was in conflict with California's rule, even though all of the Court's past rulings and the long-standing interpretation of the statute said otherwise. (So much for conservatives' belief in states' rights. When the conflict is between profits and principles, this Court has a clear favorite.)

Thanks to the Court, corporations are now free to write contracts that legally bar you from challenging them in class-action lawsuits or even group arbitration, no matter what they do to harm you. There is no mystery why the Chamber of Commerce and several large corporations filed briefs in this case.

The upshot is that corporations will now be able to decide on their own which civil rights and consumer protections they want to obey, knowing that there will be no effective means available to their victims to find redress. Even worse, not only has the radical conservative majority damaged the ability of consumers or employees to find justice, it has effectively removed any incentive for corporations to behave within the law in the first place. Why act lawfully if your victims are helpless, especially in cases like this when the harm to each individual is small but the potential for profit is huge?

This case, after all, was about a $30.22 charge for a "free" cell phone. That amount is so small that almost no one would go through the hassle and expense of fighting it out with the company one-on-one, especially in a system that's rigged by the corporation. AT&T counted on that. You can make a lot of money taking $30 at a time from hundreds of thousands of people. But if those people are able to unite with others who were similarly ripped off, suddenly the cost/benefit equation changes. With enough money at stake to make a class-action suit feasible, not only can lots of consumers get justice who otherwise might not bother, but the prospect of a big payout provides an incentive for the company to act responsibly.

But as of yesterday, that possibility is gone.

This Corporate Court, at the behest of big-business interests, is systematically draining away the rights of everyday Americans. This misguided decision must not be allowed to stand. Congress should act swiftly to end forced arbitration in civil rights, consumer, and employment disputes and restore the ability of every citizen to use the courts to find justice.


An Alliance for Justice report summarizing the facts and issues of the case, "AT&T Mobility v. Concepcion: Will the Supreme Court Give AT&T a License to Steal?" can be downloaded here.

 
 
 

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