Every year, a few blockbuster Supreme Court oral arguments and decisions dominate the news. In 2013, voting rights, LGBT equality, and affirmative action in education took center stage. Many Americans, whether lawyers or not, understood that these decisions could affect their own lives.
Almost under the radar, however, the Court has been chipping away at the very process that enables the American people to seek redress in court when they’ve been injured. In particular, the Court’s decisions enforcing arbitration clauses and class action waivers have closed the courthouse door to litigants harmed by corporate wrongdoing. Most recently, in American Express Corp v. Italian Colorslast Term, the Court ruled that class action waivers are enforceable even when they render it functionally impossible for plaintiffs to vindicate their rights under federal law.
Rich Freer, the Robert Howell Professor of Law at Emory Law School, explains the impact of these cases.
by Scott Michelman, attorney, Public Citizen Litigation Group Michelman wrote the plaintiffs’ successful petition to appeal in Roach v. T.L. Cannon, and will brief and argue the case before the Second Circuit.
When big corporations have a legal problem, they usually have no shortage of legal help - from lawyers on their own payroll or from large law firms to whom they pay hundreds of dollars an hour.
When ordinary wage-earners have a legal problem - such as being underpaid at work - obtaining relief can be a bigger challenge. Most people can't afford to hire a big law firm, and even if the amount of a legal dispute is significant to the individual, it may not be large enough to entice a for-profit lawyer to take the case.
One of our system's most important tools for leveling the playing field and providing access to the courts is the class action. This device enables people who have been wronged in a similar way to join together to pursue relief in court. Even if the value of the case to each individual is small, the aggregation of the claims makes the case big enough for a lawyer to pursue it.
Over the past several years, we have had the privilege of representing whistleblowers who have successfully pursued False Claims Act cases against some of the largest pharmaceutical manufacturers in the world. Cases against Pfizer, GlaxoSmithKline, Abbott Labs, Amgen, and most recently Wyeth which was acquired by Pfizer, resulted in the companies returning over $7 billion to government healthcare payors.
Viewed from the optics of the black letter law, these cases are about whether false or fraudulent statements cause the government to pay for drugs that doctors would not have otherwise prescribed. Yet, in human terms, these cases raise the question of whether corporate marketing goals are influencing medical decisions.
by Suzette M. Malveaux, Associate Dean for Academic Affairs and Professor of Law, Columbus School of Law, Catholic University of America
On June 20, 2013, as the general public, legal pundits and media anxiously awaited the Supreme Court to issue its blockbuster cases of the year on affirmative action, voting rights and marriage equality, American Expresswas handed down. This case is about the enforceability of an arbitration agreement that forbids merchants from pursuing their federal antitrust claims against American Express as a class action. Not the stuff most people are talking about at the dinner table . . . unless it’s mine. That day, most media trumpeted that there were “no major decisions today,” and, with a few exceptions, made little or no mention of the case. Others went so far as to claim that the public had been “cruelly trick[ed]” into learning about class action arbitration instead. In reference to American Express, Vanity Fair proclaimed that “[j]urisprudence diehards will argue that this morning’s . . . B-side ruling . . . [is] important too. These nerds are not wrong . . . .” Vanity Fair is right, on both accounts. While I usually prefer to go by “professor,” I embrace the magazine’s conclusion and urge others to do the same.
To fully appreciate the magnitude of American Express, it is necessary to first understand what the case was about. A group of merchants who accept American Express cards accused the company of using its monopoly power to force them to accept credit cards at an inflated rate. The merchants brought a class action against Amex, alleging that this tying arrangement -- embodied in a form contract -- violated federal antitrust laws. The parties had agreed in advance to resolve all disputes in arbitration. This agreement also contained a clause forbidding class actions in arbitration.
Thus, the issue before the lower courts was whether the class arbitration waiver was enforceable where the merchants had established that costs made it impossible for them to arbitrate their claims individually. The evidence demonstrated that the cost of an expert analysis necessary to prove the merchants’ claims (“at least several hundred thousand dollars, and might exceed $1 million”) far surpassed each individual’s potential recovery (some by ten times). And in the absence of any possibility of cost-sharing with Amex, this made the class action structure the only viable way to proceed. Without a mechanism for aggregating the costs of litigation, it would be impossible for the merchants to challenge Amex’s alleged unlawful business practices. Under these circumstances, the class arbitration waiver would function as an exculpatory clause, effectively giving Amex a pass for violations of federal antitrust laws.
You may have missed it in the flurry of newsmaking by the Supreme Court this week, but on Monday, five of the Justices gave early Christmas presents to defendants accused of employment discrimination, when the Court handed down important decisions in two Title VII cases: Vance v. Ball State University and University of Texas Southwestern Medical Center v. Nassar. In both Vance and Nassar, the 5-4 decisions ignored the realities of the workplace and the ways in which employment discrimination and harassment play out every day. Placing new obstacles in the path of workers seeking to vindicate their rights, the Court set aside the longstanding interpretations of the Equal Employment Opportunity Commission (the agency charged with enforcing Title VII), and closed out a term in which the Court repeatedly limited the ability of individuals to challenge the actions of powerful corporations.
Justice Samuel Alito wrote the Vance decision. Prior cases have held that when a plaintiff shows she was sexually harassed, or racially harassed, or harassed on some other unlawful basis by a supervisor, her employer is liable, unless the employer can prove that the plaintiff unreasonably failed to take advantage of a process that the employer provided for addressing harassment. An employer is only liable for harassment by a co-worker, however, when a plaintiff can show that the employer was negligent in controlling working conditions—a far tougher standard. Vance posed the question of who is a supervisor: Is it only someone who has the authority to hire, fire, or take other tangible employment actions? Or is it anyone who oversees and directs the plaintiff’s work on a day-to-day basis? Ignoring the ways in which day-to-day supervisors have been invested with authority over other employees that empowers them to harass, the Court ruled on Monday that employers are not vicariously liable for harassment by day-to-day supervisors who do not have the authority to hire, fire, and the like. Indeed, showing even more solicitousness for the interests of employers than the defendant in the case had shown for itself, the majority adopted an even narrower interpretation of the word “supervisor” than had been urged by Ball State.