Browsing Tag

contracts

Not So Mandatory After All?

This was originally going to run in the October issue of The American Lawyer, but it got killed for reasons unknown. I liked the story, though, and thought it would have been a good one, so I figured I’d post it here:

When the U.S. Supreme Court decided AT&T Mobility v. Concepcion in April, upholding a mandatory arbitration and class action waiver clause in a consumer agreement, plaintiff’s lawyers and commentators reacted as if they had lost a loved one. The New York Times accused the Concepcion majority of barring Americans from enforcing their rights in court while Jeremy Heisler, a founding partner of Sanford Wittels & Heisler, called the decision “extreme” and feared the decision would have a chilling effect on employees reporting abuses.

But a funny thing happened on the way to mandatory arbitration land, where the results are secret, the rules of evidence and discovery are relaxed, and the costs are usually much lower than in litigation. Judges in both employment and consumer class actions have been refusing to follow Concepcion, often distinguishing their own cases on factual differences. In some cases, they’ve even attributed a broad consumer-friendly undertone to Concepcion.

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