US Supreme Court grants certiorari in antitrust suit seeking class certification

Posted on: November 12th, 2012 by Steve Larson

A group of merchants brought an action against this action against American Express alleging anti-competitive conduct in trade, pursuant to the Sherman and Clayton Acts, 15 U.S.C. § 1 et seq. However, the parties had previously agreed to an arbitration clause, which included a waiver of class action claims.

The district court granted the American Express motion to compel arbitration, but the Court of Appeals for the Second Circuit found that it would be “financially impossible” for the merchants to individually arbitrate their claims and held the arbitration clause unenforceable. According to the court, prohibiting the merchants from pursuing their claim through individual or class judicial action and also prohibiting them from class arbitration stripped the merchants of their substantive rights under the federal antitrust statutes.

On appeal, American Express argues the court’s opinion is inconsistent with AT&T v. Concepcion, which held that “conditioning the enforceability of . . . arbitration agreements on the availability of class wide arbitration procedures” violates the Federal Arbitration Act. The merchants argue that pursuant to Mitsubishi Motors Corp. v. Soler Chrysler–Plymouth, Inc., 473 U.S. 614 (1985) and Green Tree Financial Corp. v. Randolph, 531 U.S. 79 (2000), that federal statutory claims may only be resolved through arbitration “so long as the prospective litigant effectively may vindicate its statutory cause of action in the arbitral forum.”

The name of the case is American Express Co. v. Italian Colors Restaurant, 667 F.3d 204 (2nd Cir. 2012).