Class Action Alert: U.S. Supreme Court Overturns California Rule that Prohibited Waivers of Class Action Relief in Arbitration Agreements
4/28/2011
By Daniel T. Pascucci, Nathan R. Hamler, and Kevin M. McGinty
On April 27, 2011, in AT&T Mobility LLC v. Concepcion (AT&T Mobility), the U.S. Supreme Court, in a 5–4 decision, ruled that federal law preempts California’s so-called Discover Bank rule, which had classified most purported class action waivers in consumer arbitration contracts as unconscionable and unenforceable. The AT&T Mobility decision breathes life into the ability of businesses across the country that regularly contract with consumers to demand, as part of that contract, arbitration of disputes and waiver of any right to pursue a class action or other aggregate or representative action against the business.
