WA S. Ct: Class Action Waiver Untenable


Cingular loses big in an opinion issued today [link]:

The plaintiffs below filed a class action suit  against Cingular Wireless (Cingular) alleging that Cingular had overcharged  consumers between $1 and $40 per month by unlawfully adding roaming and  hidden charges.  The trial court entered an order compelling individual arbitration based on an arbitration clause in Cingular's standard subscriber  contracts.  That arbitration clause contained a provision prohibiting class action litigation or arbitration.  Plaintiffs contend that class action waiver is unconscionable and unenforceable.      

We took direct review and conclude that the class action waiver is  unconscionable because it effectively denies large numbers of consumers the  protection of Washington's Consumer Protection Act (CPA), chapter 19.86  RCW, and because it effectively exculpates Cingular from liability for a  whole class of wrongful conduct.  It is, therefore, unenforceable.  Since the  arbitration clause itself provides that if any part is found unenforceable, the  entire clause shall be void, there is no basis to compel arbitration. Accordingly, we vacate the order compelling arbitration and remand to the trial court for further proceedings consistent with this opinion.

I haven't read through it yet, but it seems like a far reaching decision.
 
 
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