Supreme Court Deals Blow to Class Action Suits, Votes Along Ideological Lines in Favor of Corporate Bigwigs

Very bad news for American consumers coming from our increasingly right-wing, pro-corporate Supreme Court. A 5-4 decision yesterday in favor of AT&T and against bilked consumers essentially allows coporations to dodge the threat of class action lawsuits. Reports Adam Liptak of the New York Times:

Though the decision concerned arbitrations, it appeared to provide businesses with a way to avoid class-action lawsuits in court. All they need do, the decision suggested, is use standard-form contracts that require two things: that disputes be raised only through the informal mechanism of arbitration and that claims be brought one by one.

“The decision basically lets companies escape class actions, so long as they do so by means of arbitration agreements,” Brian T. Fitzpatrick, a law professor at Vanderbilt University, said. “This is a game-changer for businesses. It’s one of the most important and favorable cases for businesses in a very long time.”

The crux of the issue is whether consumers, who may have suffered small losses, can band together as a "class." The Wall Street Journal summed up Stephen Breyer's counter-argument in favor of consumers: ""In his dissent, however, Breyer said requiring consumers to arbitrate cases on an individual basis could lead claimants to abandon small-money cases rather than litigate." 

Read more at the New York Times and the Wall Street Journal.

AlterNet / By Sarah Seltzer

Posted at April 28, 2011, 4:41am

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