Supreme Court: Big Business Can Strip You of Right to Sue

Photo (cc) by Pets4Dawn

You win some, you lose some.

Win: The Supreme Court recently made a ruling that could lead to cheaper drugs and more generics.

Lose: The same court just made it easier for big business to force you into arbitration, thus stripping you of your right to sue.

In a 5-3 decision on American Express v. Italian Colors Restaurant, the court ruled it’s OK for big corporations to use contracts forcing consumers and small business into arbitration rather than allowing the option of court. Arbitration clauses eliminate one of the biggest weapons the public has to change bad corporate behavior: class-action lawsuits.

In fact, the companies can just write contracts in such a way that they can completely skirt existing antitrust laws. Mother Jones quotes Justice Elena Kagan in her dissenting opinion:

If the arbitration clause is enforceable, Amex has insulated itself from antitrust liability—even if it has in fact violated the law. The monopolist gets to use its monopoly power to insist on a contract effectively depriving its victims of all legal recourse. And here is the nutshell version of today’s opinion, admirably flaunted rather than camouflaged: Too darn bad.

What arbitration means

When you go to arbitration, instead of your case being heard by a judge or jury of your peers, it will instead be decided by an arbitration panel — one that many consumer advocates argue is more likely than a court to be stacked in favor of the business. We recently wrote about how more companies are taking this route, and the dangers:

  • History suggests arbitration panels tend to favor business over consumers.
  • While arbitration is less expensive than court, with arbitration you shoulder all the costs, because you’re on your own. When you join a class action lawsuit, the costs are spread. In fact, the costs are often absorbed by the attorneys representing the class.
  • Without the big judgments offered by class action suits, changing systemically bad corporate behavior becomes much more difficult.

Justice Clarence Thomas, who voted with the majority, argued that signing such contracts is voluntary, Mother Jones says. Guess he’s like most of us who thoroughly read our cell phone, credit card and other contracts, then successfully negotiate with company lawyers to have the unfair provisions removed. Right.

We think this is a big deal, and a bad deal for consumers. What do you think? Tell us on our Facebook page!

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
7 Effortless Ways to Make Extra Money
7 Effortless Ways to Make Extra Money

In the digital age, new ways of earning cash crop up all the time — and some require next to no effort on your part.

7 Small Appliances You Don’t Need — and What to Use Instead
7 Small Appliances You Don’t Need — and What to Use Instead

Here’s how to get the job done without blowing money — or losing counter space.

These Medicare Expenses Will Jump in January
These Medicare Expenses Will Jump in January

Some Medicare premiums and deductibles will take a bigger bite out of Social Security payments next year.

10 U.S. Jobs That Are Disappearing Fastest
10 U.S. Jobs That Are Disappearing Fastest

Think twice before pursuing these shrinking occupations.

26 Things Everyone Should Keep in Their Car
26 Things Everyone Should Keep in Their Car

These tools and conveniences help protect drivers from hassles and calamities on the road.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

How to Buy Gas At Costco Without a Membership
How to Buy Gas At Costco Without a Membership

The warehouse club often has some of the cheapest gas in town. Here’s how you can get it as a nonmember.

10 Things to Stop Buying If You Want a Clutter-Free Home
10 Things to Stop Buying If You Want a Clutter-Free Home

If you like to keep things simple, avoid these purchases.

Prices Are Soaring on These 7 Items
Prices Are Soaring on These 7 Items

Some surprise price jumps are making life more difficult for consumers.

A Simple Way to Silence Robocalls Today
A Simple Way to Silence Robocalls Today

A few steps can keep your phone from ringing when a spammer calls.

If You Find This Thrift Shopping, Buy It
If You Find This Thrift Shopping, Buy It

This iconic dinnerware is prized for everyday use as well as reselling for profit.

This Company Makes the Best Tires in America
This Company Makes the Best Tires in America

Driver satisfaction with tires is at an all-time high, but one brand stands out.

7 Home Improvements That Cost a Lot More in 2021
7 Home Improvements That Cost a Lot More in 2021

These projects will take a bigger bite out of your budget than in the recent past.

This Health Issue Can Hint at Dementia Years in Advance
This Health Issue Can Hint at Dementia Years in Advance

One type of pain is especially associated with cognitive decline.

Can I Switch to Spousal Social Security Benefits When My Ex Dies?
Can I Switch to Spousal Social Security Benefits When My Ex Dies?

Knowing when to claim can help you maximize benefits.

Medicare Will Not Cover These 6 Medical Costs
Medicare Will Not Cover These 6 Medical Costs

Don’t let these health care expenses catch you off guard in retirement.

8 Things You Should Always Buy on Amazon
8 Things You Should Always Buy on Amazon

The giant retailer shines when it comes to these things, from basics to hard-to-find specialty goods.

Beware This Hidden Ingredient in Rotisserie Chicken
Beware This Hidden Ingredient in Rotisserie Chicken

Something foul may lurk in those delicious, ready-to-eat birds.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

5 Ways to Fill Your Pantry With Free Food
5 Ways to Fill Your Pantry With Free Food

Anyone can take advantage of these resources.

7 Big Purchases You Should Never Make
7 Big Purchases You Should Never Make

Sometimes a big-ticket purchase is nothing more than a big waste of money.

Never Buy These 10 Things on Amazon
Never Buy These 10 Things on Amazon

Just because you can purchase something on Amazon doesn’t mean that you should.

5 States With the Worst Health Care for Retirees
5 States With the Worst Health Care for Retirees

All of these states are located in the same region of the nation.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.