Supreme Court Nukes Consumers’ Rights In Most Pro-Corporate Decision Since Citizens United

Imagine that your cell phone company cheated you out of just $30. Would you sue? Bear in mind that filing a lawsuit will require you to spend hour upon hour filing out forms and drafting complaints and dealing with legal codes that you probably know little about. Of course you can always hire a lawyer, but your lawyer’s hourly fee will eat up all of the $30 you stand to win in just a few minutes. In other words, you, like just about everyone else in the world who is scammed out of just a few dollars, you will probably give the lawsuit a pass.

Fortunately, there is a solution to this problem — the class action lawsuit. If your cell phone company cheated you and you alone, you’re out of luck. But if they systematically scammed thousands of their customers out of the same $30 — nickel and diming their way to huge profits — the law allows all of you to join together into a class action lawsuit and make sure that the company is held accountable.

That is, of course, until today.

Today, in a 5-4 opinion by Justice Scalia, the 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.

As an added bonus, Concepcion also expands an abusive practice known as “forced arbitration” that allows corporations to force their consumers, workers and patients to sign away their right to sue the company in a real court. As the Wonk Room previously explained:

In the 1980s, the justices started to rewrite a 60-year old law enacted to allow sophisticated merchants to arbitrate their disputes in fair and neutral forums — creating an abusive practice known as “forced arbitration.”  Before many banks, cell phone companies, employers, or even nursing homes will do business with a consumer, worker, or patient they force that individual to sign away their right to sue the company in a real court, requiring that any disputes be brought in a secretive, privatized arbitration system that overwhelming favors corporate parties. Moreover, as Stephanie [Mencimer] explains, the Court has made it nearly impossible to escape forced arbitration:

The court has issued a string of recent rulings upholding the right of corporations to do an array of things under the guise of arbitration clauses. Most recently, in Rent-a-Center West v. Jackson, the court ruled that companies can even write arbitration clauses that force employees who think the provision is illegal to ask an arbitrator, not a judge, to make that determination. In effect, an aggrieved employee could be in the absurd situation of having to ask an arbitrator whether hiring the arbitrator is unfair.

Today’s decision leaves millions of Americans powerless to fight back if corporate America decides to very slowly bleed them dry.