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AT&T v. Concepcion: "Consumers Win in Allegedly Anti-Consumer Supreme Court Ruling"

John Tabin's analysis (which quotes my analysis) is sound, but the typical media coverage of the 5-4 decision gives a loud megaphone to the ludicrous claim that the Supreme Court opened the way for consumers to be raped with impunity. Not one of these attacks on the decision points out that AT&T's arbitration clause makes it easier for an individual consumer to bring a profitable claim against the phone company. The only thing it does is to preclude a class action that would rip off the vast majority of consumers for the benefit of attorneys. The Supreme Court decision permits consumers to see cheaper prices; a mandatory arbitration clause still has to provide a consumer a remedy. The only losers are attorneys. (My organization, the Center for Class Action Fairness, filed an amicus brief in this case.)

The victory for consumers may be short lived. Elizabeth Warren has long expressed her disdain for freedom of contract and arbitration, and, as Dan Fisher points out has the regulatory power to abrogate the Federal Arbitration Act. And the Federal Arbitration Act does nothing to prevent federal courts from expressing distaste for arbitration; the Second and Fifth Circuits have each struck arbitration clauses in federal litigation for reasons of unconscionability. And we can expect the litigation lobby to continue to push for anti-arbitration provisions in federal legislation.

Update: Ribstein analyzes.

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.