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October 5, 2015

Supreme Court to Hear Consumer Contract Arbitration Case

This week, the Supreme Court will hear a case against DirecTV where a California class-action lawsuit was allowed to proceed despite an arbitration agreement in customer contracts.

“Trial lawyers have been desperately seeking legal loopholes to allow greater access to class actions. The DirecTV case is one of their biggest plays,” states a Wall Street Journal editorial.

Arbitration agreements are covered under the 1925 Federal Arbitration Act (FAA), but a California Appeals Court allowed the class to proceed because the contract said the parties agreed to arbitrate unless the agreement would be “unenforceable” under California law. (Wall Street Journal)

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