Ting v. AT&T
United States Court of Appeals for the Ninth Circuit
319 F.3d 1126 (2003)
- Written by Heather Whittemore, JD
Facts
In 2000 AT&T (defendant) created a contract, the Consumer Service Agreement (the agreement), to govern its relationship with its customers. Among other things, §§ 4 and 7 of the agreement mandated binding arbitration to resolve disputes; imposed confidentiality requirements on arbitration proceedings; required consumers to split arbitration fees with AT&T; and forbade class-action lawsuits. AT&T conducted market research before implementing the agreement and determined that only 30 percent of its customers would actually read the agreement. Customers were required to accept the agreement. If a customer wanted to opt out of the agreement, AT&T would cancel the customer’s account. Darcy Ting, an AT&T customer, and Consumer Action (plaintiffs), a consumer-rights nonprofit, filed a class-action lawsuit in federal district court against AT&T, alleging that the agreement violated state laws. The district court found that §§ 4 and 7 of the agreement were unconscionable and issued a permanent injunction barring their enforcement. AT&T appealed.
Rule of Law
Issue
Holding and Reasoning (Tashima, J.)
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