Concepcion Decision Showed Clear Bias for Business, Chemerinsky Says

May 11, 2011

The Supreme Court’s recent decision in AT&T Mobility LLC v. Concepcion is “nothing other than a conservative majority favoring the interests of businesses over consumers, employees and others suffering injuries,” writes UC Irvine School of Law dean Erwin Chemerinsky in an op-ed in the Los Angeles Times.

Chemerinsky explains that the court’s decision to deny individuals with claims of about $30 each their right to file a class action because the Federal Arbitration Act trumps California law does not comport with the Act itself, which provides that arbitration agreements are not to be enforced when the state court deems them unenforceable, as California law did here.

“The Supreme Court ignored this and explicitly said that it was important to protect defendants, such as corporations, from the in terrorem ("in fear") effects of class action that pressure them into settlements,” Chemerinsky writes. “The court's conservative majority could not have been clearer that it was favoring businesses over consumers.”

[The National Senior Citizens Law Center’s Rochelle Bobroff fleshes out this point in a guest post for ACSblog.]

Chemerinsky notes Justice Stephen G. Breyer’s dissent, which points out that “only a lunatic or fanatic sues for $30,” and that the class action mechanism is intended for precisely these situations.

He continues:

The effect of the Supreme Court's decision is to make it far less likely that corporations engaged in even massive fraud will be held accountable when many people lose a little. … The notion that an injured person has a right to his or her day in court is deeply ingrained in American culture. But the proliferation of arbitration agreements, and the Supreme Court's aggressive enforcement of them, means that it is increasingly a myth that an injured person can sue.

Earlier this year, ACS released an Issue Brief by DePaul University law professor David Franklin about the court’s skew in favor of business, “Why Does Business (Usually) Win in the Roberts Court?In a blog post about the Issue Brief, he points to AT&T Mobility v. Concepcion as one of three big cases this term “of great interest” to the U.S. Chamber of Commerce, and featuring “a trifecta of issues on which the Chamber has been scoring well: arbitration, preemption, and class actions.”

Watch an ACS panel discussion on Conception here, and video highlights from an ACS event on corporate influence on the federal courts here.

[Photo courtesy of AgnosticPreachersKid.]