Five-Three Majority of Supreme Court Upholds Class Waiver
In a five-to-three ruling today, the U.S. Supreme Court issued its opinion in American Express Co. v. Italian Colors Restaurant, No. 12-133, 570 U.S. __ (June 20, 2013). The Court considered whether a contractual waiver of class arbitration is enforceable under the Federal Arbitration Act ("FAA") when the plaintiff's cost of individually arbitrating a federal statutory claim exceeds the potential recovery. The Court held that it was.
"Respondents argue that requiring them to litigate their claims individually—as they contracted to do—would contravene the policies of the antitrust laws. But the antitrust laws do not guarantee an affordable procedural path to the vindication of every claim." Slip Op. at 4.