Like everybody else we took a look at the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion, slip op., 131 S. Ct. 1740 (U.S. 2011), on the Federal Arbitration Act’s preemption of state law limiting the enforceability of class action waivers. However, just as the Capitol Steps’ first reaction to a political scandal is “what rhymes with it?” our first reaction to major new precedent is “is it useful in drug/device litigation.”
Our reaction to AT&T Mobility is “maybe.” Reading the case, we don’t think that it’s possible to restrict it's scope just to class-action-based arbitrations, which is it’s precise factual context. Rather, since the motivating force behind FAA preemption is the “liberal federal policy favoring arbitration,” 131 S. Ct. at 1745, we’d have to say that state law purporting to invalidate limitations on non-arbitration class actions is a fortiori preempted. By that we mean that, if contractual limits on class actions in arbitration are enforceable under the FAA, given its arbitration-friendly policy, then contractual limits on class actions outside of arbitration are even more favored, since litigated class actions are even more invasive of arbitration rights.
So we think that AT&T Mobility invalidates all state law attempts to obstruct arbitration waivers involving class actions, whether the state is attempting to preserve class action in or out of arbitration.
However, drug and medical device manufacturers don’t enter into contracts with patients. Also, personal injury class actions have all but disappeared in drug/device litigation. Thus it’s unlikely that AT&T Mobility will have much effect on class actions involving end users of our client’s products.
But that’s not necessarily the end of it.
Please see full article below for more information.
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