Supreme Court Kills Class Action Lawsuits Against Corporations

Given that you don't buy your microwave directly from the manufacturer, yes, this would be a lot of work. Best Buy has no reason to ask you to do that.

 

I don't know any specifics on the case, or what the language of the FAA is. There's just a lot of ignorance on the nature of class actions and what they can and cannot do. This is good review for my Complex Civil Litigation test next Friday.

 

Spitballing: Best Buy could offer a credit card with an arbitration clause in which customers using it would unwittingly surrender their right to use the courts to sue manufacturers (and Best Buy). Manufacturers, of course, would give Best Buy some recompense for this protection.

 

Can you still sue Sony for their negligence in the PSN break in?

 

Certainly, they could. But that doesn't mean you have to use their credit card. And if it comes down to you buying a $1000 Washer & Dryer from Best Buy or Home Depot, BB is not going to do anything to risk losing you as a customer to HD. And no manufacturer is going to require it of Best Buy because they risk losing business to any companies that don't require it.

And beyond all of that, the record keeping of who signed off on what class-action lawsuit restrictions would cost a fortune for both the manufacturers and the retailers to maintain and then to verify when/if a lawsuit does occur. To work, it really has to be an all-or-nothing proposition.

All around, it's an absurd route to go for everyone involved in order to protect from the offchance that a class-action lawsuit occurs on a particular product.

 

You're smarter than this Major.

Let's say your average middle class family has a washer that just broke and a dryer that is on its last legs. They need a new set. Cheapest you can get off for is about $500, with a good solid average set coming in around $750. If you are an average middle class family or, God forbid, poor, it likely means you don't have several hundred in the checking account that isn't already marked for some other bill. So, you do some shopping to see which product you want and just as importantly, what kind of financing is available. You buy the stuff on credit, sign a contract that has a lot of lawyerly verbiage on it, and off you go with your new washer and dryer. Next month rolls around and the bill is $11.00 more than you thought. You call, you call, you call and all you get is a stupid answering machine loop. Finally, you manage to get someone who mumbles something about a fee in your contract. You write them asking for a detailed explanation and to have the $11.00 taken off your bill and you get back a form letter saying how happy finance company X is to have you as a customer and pointing you to their useless web site for information.

Meanwhile, bill #2 comes with a late penalty of $20.00 for not paying the contested $11.00, but it also has a $7.00 charge that shouldn't be there. This drags on for months with no results from the company. If you are lucky, you find someone who has the power to take off the charges but not the late fee (you'll have to call our North Dakota number for that department) or the late fees but not the charges (that will be handled through our Delaware department via our Pakistan call center). Finally, you've paid off the W/D and are left still writing letters over the now $63.00 you have contested throughout the life of the loan. As this happens, you try to refinance your home and find the company has reported you to the credit agencies and you can't resolve the issue in time for the closing that would get you a favorable interest rate. So, doing the math and realizing if you quickly pay the contested $63.00 you will get an interest rate that could save you several hundred each year, you begrudgingly pay the money you didn't owe.

This is the world a lot of people live in these days and it sucks.

Oh, and it is no big deal for companies to keep track of who has signed what agreement. If they figure out that they can invest a few million in a tracking system that will allow them to squeeze a billion out of consumers, you can bet the greedy will do it.

And I found this sentence so hilarious I must repeat it:

Holding Best Buy out as the paragon of customer service automatically invalidates any argument you have.

This decision sucks and makes things worse for every American not living exclusively off of capital gains. It is indefensible. The class action lawsuit was not the most effective tool imaginable, but it was the biggest hammer in the toolbox and now it is gone.

 

I agree with all of the above except the last sentence. No one signs a contract when buying a washer & dryer. And no one is going to as a result of this decision. Some people will open a Best Buy card that has lawyerly language, yes. But most people just use their already existing credit cards. At the end of the day, it's too much work on the part of the manufacturer and all the retailers to track who has signed off on these agreements. You know that not everyone will sign away their rights, meaning the potential cost of defending a class action lawsuit is still going to be there anyway. The only savings the company would get is that not everyone would be eligible to join the class - but most people don't join class actions now anyway and that's not where the real cost is for a manufacturer as-is.

Two years from now, you're not going to notice any difference in how you buy appliances and most other products. On the off chance that one of the hundreds of products you buy breaks, you won't get the letter offering you the $30 rebate if you can find your receipt from two years ago, but outside of that, nothing is really going to change for the vast majority of consumers because they weren't the ones benefiting from class action lawsuits as-is.

As has been noted earlier, the real beneficiaries here are the corporations that do things with on-going contractual agreements - phone service, etc - because they do gain 100% protection from class-action lawsuits. And that part of this decision sucks.

 

...or anybody that operates online, all you do is add in a few lines to the terms of service.

You don't like Amazon's TOS? Fine...go down to your local Borders...oh, wait...er..... Barnes & Nob....er....used bookstore.

 

I am still not clear on this. How could Best Buy legally protect the manufacturer from a lawsuit, class action or otherwise? It seems to me that in regard to a class action lawsuit directed at a manufacturer you would be looking at many different retailers. What would be the motivation of the retailers to protect the manufacturers?

 

It seems some countries like UK are already looking into it, the common citizen might not have to lift a finger....for once.

 

I said I was just spitballing, seeing if I couldn't find a practical way to put consumer products in this area. But honestly, it'd only happen on products where you're already signing some kind of contract anyway: ongoing services, credit, etc. Still, that's a big enough slice of the pie to be worrisome. I think the whole idea that you can sign away your right to use the court-system in the first place to be a ridiculous miscarriage of justice.

 

What is there to stop Corporations from adding that to Product Registration/Purchase terms of use or something?

Rocket River

 

I just glanced at the case to see if it would be helpful in studying for my complex litigation case and it wasn't. This seems like more of a preemption case rather than analysis of class actions. All that needs to be done is for Congress to fix the FAA to not negate state laws to the contrary. There has been a bipartisan push to do this, but I don't see any results as yet, not even in the 110th Congress who made the amendments (as far as I can tell).

This doesn't seem like a big bad conservatives love business court case when all they did was apply the FAA as it is written.

 

Making that sort of deal though wouldn't the manufacturer have to raise the price of its good to pay Best Buy? Would the manufacturer also pay off Target, Walmart and etc..?

Other than getting paid I don't really see what a retailer's interest is in forcing customers to accept arbitration for manufacturers and if they are getting paid it just seems like that would be a cost that would become prohibitive after awhile since if they raised prices of goods sold at Best Buy to pay off Best Buy then Target would just refuse the deal to undercut Best Buy. Such an arrangement between an individual retailer and manufacturer just doesn't seem like it would make much sense.

 

Lets say Stanley decided to add that to their products well then I would just go buy a Ryobi product that didn't have that agreement. Arbitration agreement works with things like services and software because you are locked in with a contract anyway. With things like small consumer goods other than a warranty agreement there is no contract and with something like a power drill even if you don't agree to the warranty its not that prohibitive to buy another power drill if yours breaks down.

I don't like arbitration agreements but I don't think we have to fear them spreading to everything.

 

Generally speaking .. one company does it . .then they spread
Look at the idea of Tiered Internet use . . .it seems to be catching on
Or unlimited minutes. .etc.

A year after standley . . .Ryobi does it. . then black and decker. . .etc.

Rocket River

 

Not Consumer, but supreme court blocks another class action lawsuit