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Another win for the big guy at the Supreme Court and another loss for the little guy.
You no doubt heard that the Supreme Court yesterday continued its march toward greater rights for corporations and fewer rights for individuals. Yesterday's decision in the Walmart case altered years of law regarding class action lawsuits, making it harder for groups of individuals who are discriminated against by an employer to pursue redress.
But as ThinkProgress points out, the Walmart decision yesterday takes second place to the Concepcion case that I discussed in post 1791 and that the Supreme Court decided in April.
An excerpt from ThinkProgress:
<< Nevertheless, Wal-Mart is only the second-biggest blow the Supreme Court dealt to workers, consumers and other people who need class actions to vindicate their rights during its current term.
<< Two months ago, the Court handed down a 5-4 decision in AT&T Mobility v. Concepcion, permitting corporations to refuse to do business with anyone who refuses to sign away their right to bring a class action lawsuit. As a result of this decision, Walmart need never worry about a class action again -- they can simply tell all of their workers to sign away their rights or they're fired. >>
Source:
http://thinkprogress.org/justice/2011/06/21/249820/wal-mart-second-worst/
<< Another win for the big guy at the Supreme Court and another loss for the little guy. >>
No. That ruling was win/win. If it had been allowed to proceed as a class action, then everyone in that class could have had a part of a huge some of money. The problem comes when you realize that the sheer number of women who would qualify would reduce the individual award amounts to thousands of dollars per person, if that. Class actions only make attorneys rich.
With this ruling, each person gets to proceed with their own action and prove their case in its own merits. If they win, they will receive MUCH more money than they would have as part of a class action, so they win. And Walmart pays much less overall to the winners, and so they win as well.
Josh
No. That ruling was win/win. If it had been allowed to proceed as a class action, then everyone in that class could have had a part of a huge some of money. The problem comes when you realize that the sheer number of women who would qualify would reduce the individual award amounts to thousands of dollars per person, if that. Class actions only make attorneys rich.
With this ruling, each person gets to proceed with their own action and prove their case in its own merits. If they win, they will receive MUCH more money than they would have as part of a class action, so they win. And Walmart pays much less overall to the winners, and so they win as well.
Josh
>That ruling was win/win.
I have to agree. This is not the sort of case that a class action suit is made for. Class action is for groups of people facing very specific, consistent and demonstrable harm, usually for small-ish amounts individually (such that it's not worth pursuing individually). Employment situations such as this don't fit that category, especially when they've been absurdly broadened to millions of people.
>Class actions only make attorneys rich.
Also agree. Class action almost always benefits the lawyers far more than anyone represented in the suit itself. The only value it serves, in my opinion, is as a disincentive for companies. (That said, I absolutely despise one-sided contracts of any sort, as well as the previous ruling that sanctions arbitration-only clauses in one-sided contracts.)
- Greminty
I have to agree. This is not the sort of case that a class action suit is made for. Class action is for groups of people facing very specific, consistent and demonstrable harm, usually for small-ish amounts individually (such that it's not worth pursuing individually). Employment situations such as this don't fit that category, especially when they've been absurdly broadened to millions of people.
>Class actions only make attorneys rich.
Also agree. Class action almost always benefits the lawyers far more than anyone represented in the suit itself. The only value it serves, in my opinion, is as a disincentive for companies. (That said, I absolutely despise one-sided contracts of any sort, as well as the previous ruling that sanctions arbitration-only clauses in one-sided contracts.)
- Greminty
The Supreme Court has again granted large corporations an advantage over average people. In the Concepcion case, the Court held that the right to participate in a class action can be waived by contract.
Details:
The Federal Arbitration Act says that agreements to arbitrate disputes, instead of going to court, are enforceable unless there are legal grounds to set the arbitration contract aside.
The Concepcions entered into a contract for phone service from AT&T. The contract required that AT&T and the Concepcions arbitrate any dispute, and it further provided that the arbitration could not be combined in a class (where numerous consumers with the same complaint were all joined together in one case).
There was a dispute about whether or not AT&T engaged in deceptive practices in selling discounted phones. The amount in dispute was $30*.*22. For purposes of the Supreme Court decision, it didn't really matter whether or not AT&T had engaged in deceptive practices. The only issue was whether or not the Concepcions had the right to join other consumers as a class.
The lower courts said that, based on longstanding California law, a contract denying the right of consumers to participate in a class was unconscionable and was, thus, grounds to set aside an arbitration clause.
In a 5-4 decision, the Supreme Court overruled the lower courts.
What It Means:
It means that from now on, every time you sign a contract with an employer, a phone company, a credit card company or otherwise (possibly even Simu might put it in their agreement!), you will have to waive your right to participate in a class action.
Did you get cheated out of $30.22? The answer is to hire an attorney. It won't be worth it. Removing class actions removes the only effective way consumers have to recover for small losses.
Two articles about the case:
http://wonkroom.thinkprogress.org/2011/04/27/scotus-nukes-consumers/
http://blogs.wsj.com/law/2011/04/27/after-att-ruling-should-we-say-goodbye-to-consumer-class-actions
Full text of the Court's decision:
http://www.supremecourt.gov/opinions/10pdf/09-893.pdf
Details:
The Federal Arbitration Act says that agreements to arbitrate disputes, instead of going to court, are enforceable unless there are legal grounds to set the arbitration contract aside.
The Concepcions entered into a contract for phone service from AT&T. The contract required that AT&T and the Concepcions arbitrate any dispute, and it further provided that the arbitration could not be combined in a class (where numerous consumers with the same complaint were all joined together in one case).
There was a dispute about whether or not AT&T engaged in deceptive practices in selling discounted phones. The amount in dispute was $30*.*22. For purposes of the Supreme Court decision, it didn't really matter whether or not AT&T had engaged in deceptive practices. The only issue was whether or not the Concepcions had the right to join other consumers as a class.
The lower courts said that, based on longstanding California law, a contract denying the right of consumers to participate in a class was unconscionable and was, thus, grounds to set aside an arbitration clause.
In a 5-4 decision, the Supreme Court overruled the lower courts.
What It Means:
It means that from now on, every time you sign a contract with an employer, a phone company, a credit card company or otherwise (possibly even Simu might put it in their agreement!), you will have to waive your right to participate in a class action.
Did you get cheated out of $30.22? The answer is to hire an attorney. It won't be worth it. Removing class actions removes the only effective way consumers have to recover for small losses.
Two articles about the case:
http://wonkroom.thinkprogress.org/2011/04/27/scotus-nukes-consumers/
http://blogs.wsj.com/law/2011/04/27/after-att-ruling-should-we-say-goodbye-to-consumer-class-actions
Full text of the Court's decision:
http://www.supremecourt.gov/opinions/10pdf/09-893.pdf
