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Consumer Protection Faces a 'Tsunami' in Court

Consumer Protection Faces a 'Tsunami' in Court
Photograph by Chris Ratcliffe/Bloomberg

A year ago today, a split Supreme Court issued a ruling that fundamentally changed the way consumers can pursue claims of corporate wrongdoing. In a 5-4 ruling in AT&T Mobility v. Concepcion, the Supreme Court said companies have the right to force consumers who sign contracts—like debit-card agreements and cell phone plans—to accept terms that require them to settle all disputes in private arbitration and waive their right to band together in class actions.

In just the first year, the ruling’s impact has been dramatic. “There is no case in the history of consumer law as harmful as Concepcion,” says Paul Bland, a senior attorney at the public interest law firm Public Justice. In a report released this week, the National Association of Consumer Advocates and the legal advocacy group Public Citizen, which represented the Concepcions before the Supreme Court, said they have identified 76 cases in the past year where potential class actions were shot down by judges citing Concepcion.