Was AT&T v. Concepion Pro-Business?

May 2nd, 2011

The problem with labelling a Supreme Court opinion Pro-Business or Pro-Consumer is that the implications of the case are often hard to pin down. AT&T v. Concepion (my analyses are here, here, and here). Ted Frank, who knows a thing or two about the pitfalls of class action litigation, has a post at PointOfLaw that argues that Concepion may in fact help consumers:

John Tabin’s analysis (which quotes my analysis) is sound, but the typical media coverage of the 5-4 decision gives a loud megaphone to theludicrous claim that the Supreme Court opened the way for consumers to be raped with impunity. Not one of these attacks on the decision points out that AT&T’s arbitration clause makes it easier for an individual consumer to bring a profitable claim against the phone company. The only thing it does is to preclude a class action that would rip off the vast majority of consumers for the benefit of attorneys. The Supreme Court decision permits consumers to see cheaper prices; a mandatory arbitration clause still has to provide a consumer a remedy. The only losers are attorneys. (My organization, the Center for Class Action Fairness, filed an amicus brief in this case.)

In this sense, class action arbitrations would largely dupe customers out of any meaningful recovery because attorneys fees will reduce any judgment.

It is not so easy to determine what is pro-business and what is pro-consumer. Adam Liptak’s “Pro-Business” model hardly fails to embrace any nuanced distinction.