Law School Case Brief
Scott v. Cingular Wireless - 160 Wash. 2d 843, 161 P.3d 1000 (2007)
An agreement that has a tendency to be against the public good, or to be injurious to the public, violates public policy. An agreement that violates public policy may be void and unenforceable. Wash. Super. Ct. Civ. R. 23 authorizes class actions and demonstrates a state policy favoring aggregation of small claims for purposes of efficiency, deterrence, and access to justice.
Plaintiff Doug Scott and several other consumers purchased cellular telephones and calling plans from defendant Cingular Wireless. The contracts they all signed were standard preprinted agreements that included a clause requiring mandatory arbitration. That arbitration clause, in turn, contained a provision prohibiting consolidation of cases, class actions, and class arbitration. Plaintiffs, asserting that they were improperly billed for long distance and/or out-of-network "roaming" calls, filed a class action suit against Cingular in Washington state court. Cingular filed a motion to compel individual arbitration based on the arbitration clause. Plaintiffs appealed, contending that the class action waiver was unconscionable and unenforceable.
Was the class action waiver unconscionable and unenforceable?
The state supreme court reversed the trial court's order and remanded the matter for further proceedings. The court held that a class action waiver clause was an unconscionable violation of Washington's policy to protect the public and foster fair and honest competition in Wash. Rev. Code § 19.86.920 because it drastically forestalled attempts to vindicate consumer rights. To the extent that the clause in Cingular's contract prevented cases under the Washington Consumer Protection Act, Wash. Rev. Code ch. 19.86, it was substantively unconscionable. Moreover, because the clause barred any class action, in arbitration or without, it functioned to exculpate the drafter from liability for a broad range of undefined wrongful conduct, including potentially intentional wrongful conduct. The Federal Arbitration Act, 9 U.S.C.S. §§ 1-16, did not preempt Washington law in this case. Finally, since the class action waiver stated that the entire clause was null and void if it was unenforceable, there remained no basis to compel arbitration.
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