U.S. Supreme Court Issues Significant New Decision Regarding Class Action Litigation

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On April 27, 2011, the United States Supreme Court issued an opinion in AT&T Mobility LLC v. Concepcion that will have far-reaching implications for class action lawsuits and arbitration agreements. Indeed, many commentators have described AT&T Mobility as the Supreme Court’s most important decision regarding class action suits, and two U.S. senators already have announced their intention to introduce legislation to amend the federal law upon which the Supreme Court relied.

As explained below, the AT&T Mobility decision will be especially significant to companies that transact with consumers pursuant to agreed-upon terms of use or similar agreements, or that have pre-dispute arbitration agreements with employees, because it may allow those companies to avoid class action litigation through properly drafted arbitration clauses.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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