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AT & T
In February 2002, Vincent and Liza Concepcion bought an AT&T cell phone that was advertised as "free." Indeed, they weren't charged for the phones, but they were charged $30.22 in sales tax based on the phones’ retail value.  Alleging false advertising and fraud by charging sales tax on phones advertised as free, the Concepcions sued AT&T in their home state of California, and the suit was consolidated as part of a putatitve class action on behalf of thousands of purchasers similarly screwed.

[Why a class action?  Because it's not worth your individual time to fight with them over $30.22.  But bring together every victim in one case, and it makes sense for someone to devote the time to winning it.]

But when you read the fine print of the sales agreement with AT&T (and who does, other than lawyers?), one of the provisions requires arbitration of all disputes, and that such disputes be brought in the parties’ 'individual capacity, and not as a plaintiff or class member in any purported class or representative proceeding.”  So AT&T sought to have the class decertified and force every individual into separate arbitration.  Both lower federal courts who reviewed it, however, hung up on AT&T's efforts, citing a California state court precedent requiring that waivers of class action rights be deemed unconscionable without a showing that individual arbitration adequately substituted for the deterrent effects of class actions.

And now I get to quote a June 2010 diary of mine on an employment-related arbitration provision, word-for-word:

In a 5-4 decision today authored by Justice Scalia -- and stop me if you've heard this one before, or if you need the list of who the five are -- the Supreme Court reversed the decision of the Ninth Circuit.
Here's the decision, and it pretty much comes down to "federal law supports arbitration, and this isn't so bad":
 First, the switch from bilateral to class arbitration sacrifices the principal advantage of arbitration—its informality—and makes the process slower, more costly, and more likely to generate procedural morass than final judgment.

... [C]lass arbitration greatly increases risks to defendants. Informal procedures do of course have a cost: The absence of multilayered review makes it more likely that errors will go uncorrected. Defendants are willing to accept the costs of these errors in arbitration, since their impact is limited to the size of individual disputes, and presumably outweighed by savings from avoiding the courts. But when damages allegedly owed to tens of thousands of potential claimants are aggregated and decided at once, the risk of an error will often become unacceptable. Faced with even a small chance of a devastating loss, defendants will be pressured into settling questionable claims.

... Indeed, the District Court concluded that the Concepcions were better off under their arbitration agreement with AT&T than they would have been as participants in a class action, which “could take months, if not years, and which may merely yield an opportunity to submit a claim for recovery of a small percentage of a few dollars.”

And say it with me again -- Justice Thomas, in a concurrence would have gone further, and if you care about arbitration law you should read it.

As to why this is a bad thing, let's start with Justice Breyer's dissent on behalf of himself and Justices Ginsburg, Sotomayor and Kagan:

When Congress enacted the Act, arbitration procedures had not yet been fully developed. Insofar as Congress considered detailed forms of arbitration at all, it may well have thought that arbitration would be used primarily where merchants sought to resolve disputes of fact, not law, under the customs of their industries, where the parties possessed roughly equivalent bargaining power. ... This last mentioned feature of the history—roughly equivalent bargaining power—suggests, if anything, that California’s statute is consistent with, and indeed may help to further, the objectives that Congress had in mind....

What rational lawyer would have signed on to represent the Concepcions in litigation for the possibility of fees stemming from a $30.22 claim? See, e.g. , Carnegie v. Household Int’l, Inc. , 376 F. 3d 656, 661 (CA7 2004) (“The realistic alternative to a class action is not 17 million individual suits, but zero individual suits, as only a lunatic or a fanatic sues for $30”). In California’s perfectly rational view, nonclass arbitration over such sums will also sometimes have the effect of depriving claimants of their claims (say, for example, where claiming the $30.22 were to involve filling out many forms that require technical legal knowledge or waiting at great length while a call is placed on hold). Discover Bank sets forth circumstances in which the California courts believe that the terms of consumer contracts can be manipulated to insulate an agreement’s author from liability for its own frauds by “deliberately cheat[ing] large numbers of consumers out of individually small sums of money.” Why is this kind of decision—weighing the pros and cons of all class proceedings alike—not California’s to make?

Alliance for Justice President Nan Aron released the following statement on the decision:
The Supreme Court’s decision today in AT&T Mobility v. Concepcion is a devastating and far-reaching betrayal of the most fundamental principles of American justice. Through this ruling, the Court’s ultra-conservative majority continues its relentless effort to shift power to corporate interests while hobbling the ability of everyday Americans to band together within the legal system to fight back against corporate misbehavior.

After today’s ruling, 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. By including fine-print provisions in consumer and employment contracts that compel binding arbitration and restrict the ability to file class-actions, the Court has ensured that victims of consumer abuse or civil rights violations will always be at a disadvantage in the fight for justice. 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.

The Corporate Court, at the behest of big-business interests, has once again willfully undermined our most cherished and hard-fought rights and its 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 and right of every citizen to use the courts to find justice.

Ian Milhiser, ThinkProgress:
[T]he Supreme Court effectively eliminated all consumer class actions and left corporate America free to cheat every single one of their customers a few dollars at a time.  Scalia’s opinion in AT&T Mobility v. Concepcion permits corporations to refuse to do business with anyone who refuses to sign away their right to bring a class action lawsuit if the corporation breaks the law. After Concepcion, it is only a matter of time before nearly every credit card provider, cell phone company, mail-order business or even every potential employer requires anyone who wants to do business with them to first give up their right to file a class action.
Learn more about the case here.

[HT: mrbeen38 got here first.]

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Comment Preferences

  •  Free Trivia Question (20+ / 0-)

    From 2003-2007, how many of AT&T's 90 million AT&T customers brought claims in arbitration?

    •  180? (4+ / 0-)
      Recommended by:
      Adam B, pico, wader, TexDem

      That many?

    •  Giving away free trivia... (1+ / 0-)
      Recommended by:

      when you could profit from it... that's...  SOCIALISM!!!  j/k

      Show me a sane man and I will cure him for you ~ C.G. Jung

      by JClarkPDX on Wed Apr 27, 2011 at 05:36:59 PM PDT

      [ Parent ]

    •  I love my iPhone, but (6+ / 0-)

      this is making me think I don't need a phone at all.

      It's amazing how fast we have descended into a plutarchy. We lasted as a reasonable approximation of a democratic republic for almost 200 years, and yet in about 35 years we have degenerated into a state governed by a small group of very, and increasingly rich, people.

      We are really screwed.

      •  ouch (0+ / 0-)

        I don't think it's all that coincidental that it was only about 35 years ago that the state was anything but a small group of relatively very and increasingly rich [white protestant male] people.

        What I'm saying is I think it is a matter of perspective. At the same time Reagunism caused the radical growth in the income gap, the Civil Rights era and technology enabled a radical change in the public perception of social status markers. With few exceptions, (and the huge but mostly white middle class generated by the union movement is not really one of them) the vast majority of the people lived in poverty all the time. Our current situation is certainly bad, but any 'golden age of egalitarianism' in our history has been substantially composed of myth, from the very start.

        We are still only approaching a "reasonable approximation" of the broad active democracy we've always imagined ourselves to be. And now it seems we are literally so close, in such a real way, that it gets harder and harder to maintain your perspective on how far we have to go versus how far we have already come. But that's why change you can believe in requires the audacity of hope.

        After Concepcion, it is only a matter of time before nearly every credit card provider, cell phone company, mail-order business or even every potential employer requires anyone who wants to do business with them to first give up their right to file a class action.
        Concepcion, meet Elizabeth Warren. Elizabeth Warren, meet Concepcion. You two have a lot to discuss.
    •  I can't help thinking American jurisprudence... (0+ / 0-) quickly becoming irrelevant to the lives of everyday Americans. If it continues on this way, why should anyone actually pay any attention to the law? They can't throw all of us in jail, not that that wouldn't stop them from trying.

      The Neo-Fascists (America should be run like a corporation, for the corporations) have won.

      The sleep of reason produces monsters.

      by Alumbrados on Wed Apr 27, 2011 at 07:24:00 PM PDT

      [ Parent ]

      •  I was thinking along the same lines (0+ / 0-)

        back in the 70's, B of A banks got bombed alot. Just wait until someone clues in all the teabag wingnuts whats really being done to them and they unleash their hate and venom on corporations and SCOTUS. Mrs Thomas might not be their favorite person then, or The Donald(dick) for that matter

    •  Do you know how may of those (0+ / 0-)

      had an arbitration result in their favor?

      The last time I heard a story about arbitration, there was a large ratio of results favoring the company to results favoring the individuals.

  •  Congress and Courts (12+ / 0-)

    Corporate bought and owned. Sad really.

  •  The Supreme Court of The Chamber of Commerce (16+ / 0-)

    is now in Session.

    I'm the terror that blogs in the Night,. and the daytime too.

    by JML9999 on Wed Apr 27, 2011 at 05:23:13 PM PDT

  •  Have not read the decision (3+ / 0-)
    Recommended by:
    Sylv, wader, TexDem

    Was the suit making claims under state law?

  •  I don't understand the substance of the case (1+ / 0-)
    Recommended by:

    Aren't you typically liable for sales tax on something you get for free, as a prize or promotion?  It's not like AT&T made any money by charging the sales tax, which goes entirely to the state.  I think it's a bad decision for all the reasons you've noted, but it's hard for me to see how the Concepcions could possibly have prevailed in arbitration either singly or as part of a class.

    It's better to curse the darkness than light a candle. --Whoever invented blogs, c.1996

    by Rich in PA on Wed Apr 27, 2011 at 05:25:58 PM PDT

    •  the argument is ... (6+ / 0-)

      ... they made money by falsely advertising that it was free.

      •  That's a real but tenuous argument. (5+ / 0-)

        But since we're all about the fine print in this case, was there any fine print to tell consumers they'd be liable for the sales tax?  If so, the company would seem to be in the clear; if not, it would (in my lay opinion) be a question of whether a reasonable person would expect some incidental costs associated with getting something for free.  If you win a car, for instance, by common consensus it's up to you to understand there are insurance and other costs associated with taking possession of it; is sales tax on the nominal value of the phone in that category of obviousness?

        I know the big deal here is the class action aspect but I find the underlying case pretty interesting!

        It's better to curse the darkness than light a candle. --Whoever invented blogs, c.1996

        by Rich in PA on Wed Apr 27, 2011 at 05:45:24 PM PDT

        [ Parent ]

    •  But that's weird! Isn't it? (6+ / 0-)

      In most countries in the world, I think, you are liable for VAT or sales tax based on the actual price that you are paying. If you get a discount, e. g., the VAT is calculated based on the reduced price. The price that the two contractual partners - seller and buyer - agreed upon. To calculate VAT on some imaginary price - this is the first case I heard of this in my life. Really. Confused.

      •  I know someone who won a motorcycle... (2+ / 0-)
        Recommended by:
        mythatsme, lordcopper

        ...and he had to pay the sales tax.  That's the sole basis for my surmise that it's the norm--maybe it's not!

        It's better to curse the darkness than light a candle. --Whoever invented blogs, c.1996

        by Rich in PA on Wed Apr 27, 2011 at 05:46:40 PM PDT

        [ Parent ]

        •  Now you've got me wondering. (3+ / 0-)
          Recommended by:
          mythatsme, VClib, Cassandra Waites

          I'd always assumed the people who won things on game shows like 'wheel of fortune' would be paying taxes on them, and as such assumed that it would be really sucky to win 'a brand new car!' without having also won the cash along with it to pay the taxes on both the cash and the car.

        •  Not only sales tax, but income tax. But it's (1+ / 0-)
          Recommended by:

          still cheaper than if you went out and bought it.

          "Because I am a river to my people."

          by lordcopper on Wed Apr 27, 2011 at 06:40:35 PM PDT

          [ Parent ]

        •  It certainly is "normal" (1+ / 0-)
          Recommended by:

          for cell phones, in the United States, to be offered at a "discount" rate to the end user and for that user to pay sales tax based on the "actual" retail price of the item. That $700 iPhone that "cost" you $199 plus a two-year contract...well, you paid sales tax on $700. When I inquired with AT&T about it a year or two ago, the salesperson very apologetically told me that it was the LAW that they collect full sales tax. It was, in fact, according to AT&T, California's fault that I was being charged sales tax on some fictional "full price."

    •  Rich as they say - bad cases make bad law (0+ / 0-)

      I too think the substance of this case is really weak. When receiving anything for free, including prizes, you are responsible for all taxes due and the burden is on you to pay them. While the SCOTUS was not deciding on the merits, I do think that the plantiffs picked the wrong case to go the distance. In this case AT&T wasn't even receiving any additional income.

      "let's talk about that"

      by VClib on Wed Apr 27, 2011 at 07:46:14 PM PDT

      [ Parent ]

      •  Not the plaintiffs' choice (1+ / 0-)
        Recommended by:

        They won before the district court and the 9th Cir; it was AT&T which had to appeal it up.

        •  Add to that (1+ / 0-)
          Recommended by:

          that the arbitration clause in AT&T's contract was a more "consumer friendly" arbitration clause specifically designed to challenge California's rule that class action bans in arbitration clauses are unenforceable.  AT&T wanted this arbitration clause in front of the Supreme Court because it at least gives the impression of being less oppressive.  I think the Supreme Court ruling, however, goes even further than AT&T would have expected.  

        •  Adam - I didn't state my point well (1+ / 0-)
          Recommended by:
          Adam B

          The lawyers who picked this as a class action made a bad choice from the beginning.  It was not as though this was a hidden tax. Each consumer knew at the time of entering the contract that they were paying a tax and could have decided at that time to not make a purchase decision. Add to that that all of the out of pocket cost to the consumer was going directly to the state, and that the arbitration clause had been tweaked to challenge California's law. When you add it all up it was a poor choice from the beginning.

          "let's talk about that"

          by VClib on Thu Apr 28, 2011 at 07:21:58 AM PDT

          [ Parent ]

    •  That's not really the issue here. (4+ / 0-)
      Recommended by:
      Adam B, yaque, Ace Pumpkin, MKinTN

      That would get to be heard and decided in the Superior Court if the SCOTUS had allowed it to proceed (and, as you describe, it may well not have actually made it to judgment).  Plaintiffs' counsel probably didn't have a very compelling case on the merits, if what we're being told is correct; AT&T's actions were apparently less-than-clear but probably not fraudulent (based on the 3-4 sentences I've read about the merits of this action).  From where I sit, their original claim seems to be an unusual assertion.  I have no clue if the claim is being reported accurately or not.

      Rather, the problem was that SCOTUS instead took the opportunity to basically eliminate the right to the class action lawsuit when your relationship with the entity you're suing is governed by contract.  Nearly everything we do contains a contract or EULA, many of which already contain arbitration clauses; it is likely that all of them will soon contain arbitration clauses.  It is nearly impossible for individual customers to legally contest a charge in the mid 3-digits and below - they rely on companies' good will when the dollar amounts are that low; to legally compel company to make good on dollar amounts that small, you need to file a class action so as to spread out the cost, risk, and contingency fees amongst thousands or tens of thousands of customers.

      That kind of class action, barring a very unlikely change to the Federal Arbitration Act, is now basically dead, and we're back to relying on companies' good will to make good on errors or malfeasance of amounts too small to warrant participating in a lengthy arbitration process.  If your cell phone company overcharges you for $20, you're just going to grumble a lot and maybe write a nasty letter.  Before today, if they overcharged all California customers $20, that added up to an amount worthy of litigation.  After today?  Short of strongly-worded letters, there is no credible legal recourse; companies are already able to make the arbitration process outrageously onerous.  I'm not sure if this is enforceable or not, but I've seen arbitration clauses that state that all arbitrations will take place in Kansas (or some other sparsely-populated Plains state).  Even if you're in Los Angeles or Boston, to get your $20 back, you'll have to go to arbitration in Kansas.

      This has very far-reaching implications.  For instance, there is an ongoing disagreement right now about whether or not companies can force claims of civil rights' violations into arbitration.  If the SCOTUS rules to that effect, this ruling regarding class-actions will likely also have extremely severe effects on enforcement of civil rights' laws through litigation, particularly in disability cases, where this is a particularly effective strategy - you can use a class action lawsuit not to gain monetary damages but to instead obtain an injunction or compel a settlement with against the non-accommodating entity to agree to cease discrimination and to take a series of steps to ameliorate past harm.  There are a lot of bad places this can go, and the ruling really cries out for an amendment to the Arbitration Act, but because such an amendment is easily portrayed as being a "giveaway" to "trial lawyers," its likelihood of actually being enacted is extraordinarily low.

      "What Washington needs is adult supervision" - Barack Obama

      by auron renouille on Thu Apr 28, 2011 at 01:11:02 AM PDT

      [ Parent ]

  •  So Kagan and Sotomayor... (4+ / 0-)
    Recommended by:
    jj32, cocinero, Cheez Whiz, lordcopper

    Obama's picks for the SCOTUS did not rule on the side of corporations?

    But I thought...

    Show me a sane man and I will cure him for you ~ C.G. Jung

    by JClarkPDX on Wed Apr 27, 2011 at 05:25:59 PM PDT

  •  Thanks again, Ralph n/t (1+ / 0-)
    Recommended by:
    •  Merely a reaction to the rightward shift of (0+ / 0-)

      this country, not the cause.

      No nation can be great if it allows its elites to loot with impunity and prosecutes its whistleblowers. Geithner is destroying the things that made America great. -- Bill Black, white-collar criminologist & a former senior financial regulator

      by jboxman on Wed Apr 27, 2011 at 07:46:58 PM PDT

      [ Parent ]

  •  Has anyone stopped to ask how you can (5+ / 0-)

    charge sales tax for something that is not 'sold'?

    No matter how I slice it every time I multiply 8.35% by zero, I still get zero,

    "I've taken up sculpting recently. Landscapes mostly." ~ Yogi Bear

    by eXtina on Wed Apr 27, 2011 at 05:26:36 PM PDT

    •  When is a sales tax not a sales tax? n/t (1+ / 0-)
      Recommended by:

      -- We are just regular people informed on issues

      by mike101 on Wed Apr 27, 2011 at 05:29:09 PM PDT

      [ Parent ]

    •  That depends on the worth of the item (5+ / 0-)
      Recommended by:
      marina, wader, Cassandra Waites, yaque, MKinTN

      Sales tax isn't supposed to be based on the cost to the consumer, but rather the regular value of the item - in theory.

      If AT&T says "free phone*   *Consumer is responsible for taxes for the retail value of the phone", then AT&T isn't in hot water.  If AT&T says "free phone" without the qualifiers, then they wind up in this class action and have to get bailed out by the Supreme Corporate Court of America.

      Necessity is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves. - William Pitt

      by Phoenix Rising on Wed Apr 27, 2011 at 05:49:50 PM PDT

      [ Parent ]

      •  I realize that but I think it is illegal to (0+ / 0-)

        charge tax on something that no money was collected on in a sale. If you pay $20 for it, tax is assessed on that amount. If you pay $5, you pay only that much tax. So the tax here is on Zero dollars Zero cents. My point is states are collecting taxes that they have no right too. I also realize the IRS assesses tax on winnings and things you haven't paid for but got, like say a free vacation but that is 'income' not money you spent. I think it is an important distinction and surprised it wasn't part of the discussion of the case. Screw their qualifiers, AT&T doesn't decide who pays taxes on what.

        "I've taken up sculpting recently. Landscapes mostly." ~ Yogi Bear

        by eXtina on Wed Apr 27, 2011 at 07:10:38 PM PDT

        [ Parent ]

  •  My partner just said (11+ / 0-)

    "So basically, corporations can treat you however they want and can elect whoever they want?"

    I live to help others.....too bad the Christianists don't.

    by kempsternyc on Wed Apr 27, 2011 at 05:27:13 PM PDT

  •  Would just like to point out something for (10+ / 0-)

    the people who say there is no difference between the parties.

    1. Significant SCOTUS decision

    2. 5-4 decision

    3. Both Bush 43 appointees in the majority(making the difference in the case), both Obama and Clinton appointees in the minority.

    Yeah, the parties are exactly the same.

  •  5 criminals (1+ / 0-)
    Recommended by:
    My Name Isnt Earl

    presiding over the Country on behalf of the criminal element that benefits benefits from it.

    Elections really really matter.....

    Poor government comes about when good citizens sit on their hands instead of standing on their feet.' -- Robert Baker

    by jaysunb on Wed Apr 27, 2011 at 05:28:36 PM PDT

    •  I wouldn't call them criminals (0+ / 0-)

      Hacks, yes, whores, yes, but not criminals, at least in Nevada.

      "We have always known that heedless self-interest was bad morals, now we know that it is bad economics." Franklin Delano Roosevelt, Jan. 20, 1937

      by Navy Vet Terp on Wed Apr 27, 2011 at 05:53:07 PM PDT

      [ Parent ]

  •  Doesn't this reverse Walker of Wisconsin? (9+ / 0-)

    If teacher associations had binding contracts with local school boards which include binding arbitration, then how can a governor and puppet legislature change the law and negate that?

    If arbitration is now a federal right guaranteed to corporate persons, is it not then also a right guaranteed to real persons?

    "When I use a word," Humpty Dumpty said in rather a scornful tone, "it means just what I choose it to mean -- neither more nor less."

    by Eman on Wed Apr 27, 2011 at 05:29:53 PM PDT

    •  If only things worked out consistently (6+ / 0-)
      Recommended by:
      marina, maynard, wader, mrbeen38, LarryNM, MKinTN

      As Armando notes above, this is Bush v Gore-like in its violation of basic federalism/states' rights doctrines.

      Wall street bonuses = sacred contracts

      teachers contracts = theft by union thugs

      "There’s nothing courageous about asking for sacrifice from those who can least afford it and don’t have any clout on Capitol Hill."

      by bay of arizona on Wed Apr 27, 2011 at 06:04:17 PM PDT

      [ Parent ]

  •  Nice job. (7+ / 0-)

    We are so so fucked.
    And by "we," I mean 99.8% of the people who live here.

    That .2% will be just fine.

  •  Is it me (1+ / 0-)
    Recommended by:
    bay of arizona

    Or has Kennedy become a completely different judge?

    I live to help others.....too bad the Christianists don't.

    by kempsternyc on Wed Apr 27, 2011 at 05:30:33 PM PDT

  •  As Elizabeth Warren says, the fine print (0+ / 0-)

    in any contract is the devil and there's no doubt Thomas loves his devils.

  •  Did They Forward the "Tax" to the State? (2+ / 0-)
    Recommended by:
    Ophelia, Ezekial 23 20

    Seems to me there could a state legal issue, if not for falsely charging a sales tax on a sale of zero dollars, or maybe for cheating the state.

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Wed Apr 27, 2011 at 05:34:49 PM PDT

    •  I don't see how they couldn't have (0+ / 0-)

      But perhaps only at the end of the year - so a $30 interest free loan per subscriber is what they are protecting.

      btw, I'm gonna start using your KRATS formulation above.

      "There’s nothing courageous about asking for sacrifice from those who can least afford it and don’t have any clout on Capitol Hill."

      by bay of arizona on Wed Apr 27, 2011 at 06:08:07 PM PDT

      [ Parent ]

    •  It's usually the state law that requires that (0+ / 0-)

      sort of stuff.  Some states say that the sales tax has to be on the retail price, not on the discounted price.  That's probably what's going on here.

  •  time for legislation to fix that act (2+ / 0-)
    Recommended by:
    Reframing the Debate, wader

    And then the Supreme court decision is null and void.

  •  it's the free market being allowed to regulate (0+ / 0-)


    with a thumb, big toe, shoe, anvil and the QEII helping tip the scale on the side of corporations.

    Bumper sticker seen on I-95; "Stop Socialism" my response: "Don't like socialism? GET OFF the Interstate highway!"

    by Clytemnestra on Wed Apr 27, 2011 at 05:38:12 PM PDT

  •  Ive said it before and I'll say it again (6+ / 0-)

    america is a place you might start giving some serious thought to escaping from, whether you think you can or not.

    Being born somewhere doesn't mean you have to stay there - indeed it's ironically how this country was born and how many of us are here today. Someone, somewhere in your family made the tough choice to leave everything they knew to go somewhere where the opportunity at life and dignity was better.

    I am not sure how we divorce the corruption that is interwined into our system from our system anymore. We are becoming more and more everyday like countries with mockeries for elections and mockeries of courts; where people have no money, no power, no food, no security, no dignity. Much of America is too dumb or blind or numb to see it. Screeching about unions and birth certificates while the ruling class takes what little we have, laughing and closing us out little by little and in broad sweeps from having any power against them.

    I'll say it again because it needs to be said: fight. But have a back up plan. Seriously.

    Don't tell me what you believe. Tell me what you do and I will tell you what you believe. h/t MeteorBlades

    by mdmslle on Wed Apr 27, 2011 at 05:39:42 PM PDT

  •  Think positive (2+ / 0-)
    Recommended by:
    Adam B, wader

    I, for one, welcome our new insect overlords.

  •  I agree, but... (2+ / 0-)

    these class actions are do nothing from the consumer viewpoint. We'd end up getting an offer of a $10 off coupon for our next AT&T phone bought at full price.

  •  Even if the Court wants to side with corps., (13+ / 0-)

    they need a legal tether to do it.  Here, I just don't understand the Court's reasoning.  The statute basically says arbitration clauses are enforceable unless state law creates a defense to formation.  State law in this case creates a defense to formation.  But based on the savings clause in Section 2 of the FAA, I don't see how Congressional policy is "frustrated," except by willful misreading of both the statute and California law.  

    Scalia also talks a lot about depriving parties of "choice," even conceding the contract is adhesive.  So, I guess the holding is that defense to formation are preempted by the FAA if they are inconsistent with the terms of the arbitration "agreement?"  I guess the slippery slope implications are the basis to grant cert over what is otherwise a relatively minor issue -- AT&T could have done two things to stay out of district court:  (a) not commit fraud , and (b) submit to class arbitration.  Given the "least cost avoider" here, it's not crazy to see that this is not ordinarily a case worth the Court's time, except as a vehicle for judicial activism.  And here, it's also notable that class arbitration and district court litigation both serve a deterrent function that is not available here.  

    This opinion will come in handy the next time Scalia tries to should "plain text" at the top of his lungs.  It's also worth examining in the context of the AT&T merger with T-Mobile, since I imagine the lawyers argued that losing customers could serve a deterrent function.  

    "This world demands the qualities of youth: not a time of life but a state of mind[.]" -- Robert F. Kennedy

    by Loge on Wed Apr 27, 2011 at 05:47:59 PM PDT

  •  Verizon has the same contract... (8+ / 0-)

    They refused to negotiate on the contract when I said I didn't want to waive my rights. This sort of thing is really frustrating to me, but since I'm trying to be less high strung I just let it go. My guess is it's pretty hard to get a cell phone contract without waiving your legal rights as an American citizen. Welcome to corporate feudalism.

    Passive renunciation is not the whole of wisdom.

    by play jurist on Wed Apr 27, 2011 at 05:48:54 PM PDT

  •  at least this is not 'pro corporate' (0+ / 0-)

    after all the money does not go to AT&T but rather the state - TAXES!

    "I've taken up sculpting recently. Landscapes mostly." ~ Yogi Bear

    by eXtina on Wed Apr 27, 2011 at 05:49:11 PM PDT

  •  Adam B, you should give a shout out to (2+ / 0-)
    Recommended by:
    bay of arizona, mrbeen38

    the diarist that wrote the diary on this earlier, especially since your comment there got so many rec's.

    •  Its on the top of the rec list (0+ / 0-)

      Usually they write "join the discussion in X's diary" but Adam said this was pre-written.

      "There’s nothing courageous about asking for sacrifice from those who can least afford it and don’t have any clout on Capitol Hill."

      by bay of arizona on Wed Apr 27, 2011 at 06:10:48 PM PDT

      [ Parent ]

    •  Thanks! (0+ / 0-)

      He has a shout out down at the bottom.  Good enough for me.  I just wanted to get the word out about this case and its implications because it was not getting much coverage.  As long as folks get informed about this stuff, that is good enough for me.  

  •  One odd thing about the statute is that (3+ / 0-)

    when it was first passed in 1925, it applied only to interstate commerce which had a far narrower meaning than it does today.  

    It has expanded its reach, way beyond its original intention, as a result of expansive Supreme Court interpretations of the commerce clause.  

    It is likely that the law as it now stands could never have passed Congress.

  •  serfs up n/t (3+ / 0-)
    Recommended by:
    Ezekial 23 20, marina, wader

    UC is becoming a finishing school for rich Asians. ~ California economist

    by anyname on Wed Apr 27, 2011 at 05:57:03 PM PDT

  •  Wow, a whole new pricing scheme. (1+ / 0-)
    Recommended by:

    First it was outsized handling fees. Now, sales tax on imputed value. What's next, overpriced printer ink?

    Moderation in most things. Except Reactors. IFR forever!

    by billmosby on Wed Apr 27, 2011 at 05:57:18 PM PDT

  •  The obvious response here, is to work to limit (5+ / 0-)

    the number of corporations with which you do business, and to buy from small, local merchants as much as possible.  Local folks can and will suffer if word gets out that they cheat their customers.  Big corporations won't give a damn, and will consider this a green light to cheat everyone and anyone, as often as they can.

  •  It's FREE!* (9+ / 0-)

    The US Supreme Court has declared Corporations are FREE* to cheat their customers!

    (*sales tax and attorney fees not included)

    The daily floggings will continue until morale improves.

    by Tuba Les on Wed Apr 27, 2011 at 05:58:28 PM PDT

  •  So as an At&t captive customer (5+ / 0-)

    who has no other choice for my land line phone, I am bound to abide by this courts decision and have no redress by the court system.

    Ain't that just hunky dory.  Makes you want to just throw up your hands doesn't it?  A pox to you and your house George Bush who inflicted this court on our country.  

  •  Another lawless gem from the Supreme Courtesans. (0+ / 0-)

    The conundrum of stable democracy: Reform requires the consent of the corrupt.

    by Troubadour on Wed Apr 27, 2011 at 06:23:59 PM PDT

  •  So? Just don't do business with (2+ / 0-)
    Recommended by:
    Kentucky Kid, maynard

    scumbag corporations.  People naively keep thinking they are going to get something of value from a CoprophageanCorpseporationCorporation.  

    People actually still believe TV commercials; they really believe they need all this shit.

    People just keep on giving money to sharks.

    Hello?  Anybody awake out there?

    Do you REALLY need their shit?  Just say no.  And turn off that fucking television and get a fucking life, while you are at it.

    It's the only power you have left, the power to keep your money in your pocket.


    don't always believe what you think...

    by claude on Wed Apr 27, 2011 at 06:37:06 PM PDT

    •  Fine, until you have no choice to do business. (4+ / 0-)

      Imagine PG&E pulling this. They contract with the state and you can't avoid doing business with them, unless you don't want to use electricity.

      There's other situations, too- like the three insurance companies available for you to choose from all including this clause in their contract, but the upshot is we're screwed.

      -this space for rent-

      by EsnRedshirt on Wed Apr 27, 2011 at 07:27:06 PM PDT

      [ Parent ]

      •  And banks or other financial institutions (0+ / 0-)

        unless you want to stuff your money in your mattress, and credit card companies, at least for those who hope to buy a car or a house some day and need some way to demonstrate good credit.  Life insurance, health insurance, and perhaps the most alarming, employment at a corporation.

    •  I'm about the last person to own a cell phone (1+ / 0-)
      Recommended by:
      Reframing the Debate

      But it's actually a dent in your social life if you refuse to have one, as I did for many years, when at an employer that didn't provide one as part of the job.

      Sadly, the AT&T purchase of T-Mobile will surely be approved, meaning even less competition in the cellular market.  Hooray!

      No nation can be great if it allows its elites to loot with impunity and prosecutes its whistleblowers. Geithner is destroying the things that made America great. -- Bill Black, white-collar criminologist & a former senior financial regulator

      by jboxman on Wed Apr 27, 2011 at 07:49:24 PM PDT

      [ Parent ]

  •  And coincidentally, South Park tonight touches... (1+ / 0-)
    Recommended by:

    On this in an ep where Kyle unwittingly signs a contract allowing Apple to do all sorts of unspeakable things to him (and other Apple consumers who failed to read the fine print in their EULA's).

  •  Increasingly, I see the governing institutions (2+ / 0-)
    Recommended by:
    mrbeen38, LarryNM

    in the United States as lacking any popular legitimacy.  If only the situation would play out as it has in Egypt.  The Egyptians clearly hunger for Democracy.  Do we?

    No nation can be great if it allows its elites to loot with impunity and prosecutes its whistleblowers. Geithner is destroying the things that made America great. -- Bill Black, white-collar criminologist & a former senior financial regulator

    by jboxman on Wed Apr 27, 2011 at 07:45:16 PM PDT

    •  Little by Little (0+ / 0-)

      Our democracy is being stripped away from us and our leaders lack the courage and convictions to defend that democracy.  It is so sad to watch it unfold.  Yet the people do nothing about it, stuck in their dream visions of what the United States is and what the United States represents.  I wonder whether they will awaken before it is too late.  

  •  So the Supreme Count just keeps on (0+ / 0-)

    fucking us. This decision certainly doesn't suprise me at all.

    The only thing that would have suprised me would be a different outcome.

    Honesty pays, but it doesn't seem to pay enough to suit some people. Kin Hubbard

    by Mr Robert on Wed Apr 27, 2011 at 08:50:55 PM PDT

  •  This is really depressing. (0+ / 0-)

    I don't think we have much of a chance to change anything for the better with the 5 conservatives on SCOTUS chipping away at our democracy. I think the one single thing we can do to save our democracy is to impeach Clarence Thomas. He seems to be a very low hanging fruit, but to do that we need a liberal majority in the House.

    "They had fangs. They were biting people. They had this look in their eyes,totally cold, animal. I think they were young Republicans."

    by slouching on Wed Apr 27, 2011 at 11:34:06 PM PDT

  •  Normally (1+ / 0-)
    Recommended by:
    Adam B

    I end up having to seethe reading a Scalia-authored decision because I truly despise his politics and how he infuses his decisions, most of which I don't like, with them -- because they are usually brilliantly written and with rock-solid legal reasoning with which I might disagree, but I can't say it's a complete overreach.

    This decision is very different in character.

    Today's decision is IMO extraordinarily weak in its legal analysis, as I believe Breyer's dissent highlights repeatedly when it points out the lack of precedent for trumping a state's substantive law (CA's unconscionability doctrine as it relates to consumer contracts of adhesion which prohibit class relief) through a holding that a federal procedural mechanism (the FAA) is entitled to greater protection where the two conflict, thus pre-empting the substantive law.  I've read the decision twice now and for the first time ever I truly seen Scalia just out on a limb when it comes to analysis.

    The practical outcome, of course, is that I believe this is the death knell for meaningful consumer redress as it relates to most small consumer contracts.  (Which is, of course, most of them.) Individual arbitrations simply don't work for the consumer despite what ATT claimed and despite the language of its adhesion contract upon which Scalia relied, because for small-scale consumer contract grievances lawyers aren't going to take the financial risk (as if somehow, a promise of attorney's fees is still going to be enough for an attorney to accept a consumer case when the promise exists only if you win at least double what ATT's last offer before arbitration is -- an offer that can of course come only after you've spent far more than the maximum $7500 a consumer receives on pre-arbitration discovery the like.)  So pretty much it will be open season on "tiny violations".  Indeed, already ATT has amended its arbitration agreement following yesterdays' decision.  I would be upset about the practical outcome anyway, but to see it imposed 5-4 through a decision as weak analytically as the one Scalia penned in this case is really depressing.

    If you don't stand for something, you will go for anything. Visit Maat's Feather

    by shanikka on Thu Apr 28, 2011 at 05:35:55 AM PDT

  •  Plaintiff's Will Have To INCORPORATE Then Sue (0+ / 0-)

    Ok, no class action? How about my company (of all the plaintiff's) suing yours?

    This post is dedicated to myself, without whom, I'd be somebody else. Though I'd still be an asshole. My Music:

    by Beetwasher on Thu Apr 28, 2011 at 07:28:51 AM PDT

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