Big corporations: 1. Consumers and small business: 0. Supreme Court: -1.

Another Blow to Class Action

By THE EDITORIAL BOARD, NYT

This week, the Supreme Court continued its aggressive effort to favor corporations by forcing customers to raise grievances through individual arbitration rather than a class action or some other joint legal challenge.

In American Express Company v. Italian Colors Restaurant, the court ruled 5 to 3 that a group of merchants could not bring a class action against the company even on antitrust grounds because each had signed a contract that required complaints to be taken to individual arbitration.

The decision makes it very hard, if not impossible, to stop bad corporate practices because the potential award for an individual would be too small to justify a suit.

American Express requires merchants that want to accept its corporate and premium charge cards to also accept American Express credit cards, at a fee that is 30 percent higher than other credit cards’ fees. Italian Colors Restaurant and others claimed that by requiring them to accept the third card the company is subjecting them to a “tying arrangement,” in violation of federal law.

(More here.)