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I was reading about forced arbitration clauses, or class action wavers, which are a type of contract of adhesion which can come with some products and services. Historically, these were deemed unenforceable;

for good reason, I think, because if eventually every service or product came with a contract which prevented consumers from filing a lawsuit or class action if, say, for instance, the product or service caused injury or death, like a car with braking system flaws, or a child's toy that causes cancer, etc, then we'd live in a world where corporations could shove whatever they wanted down our throats, cause injuries and death, and we could do nothing about it, because we "agreed to a contract" by using their product or service in the first place (and in this scenario there would be no alternatives, so you either risk using products that could kill you, or you go live in a cave or something).

So while I was reading about arbitration clauses, I learned about "ATT Mobility vs Concepcion", which is the case which changed the precedent, and allowed these kinds of clauses to be enforced.

What I want to know is, does this mean that arbitration clauses will always be enforced now? or does it simply mean that in certain cases they can be enforced?

Does a supreme court case set the precedent for how all similar cases from that point forward will be decided? because I've always heard supreme court cases referred to in such situations; as if they mean that such cases have already been settled due to one supreme court case involving a similar subject.

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    Every appellate court decision binds all lower courts that report to it. The U.S. Supreme Court is special because it is the only court in the United States to which all other state and federal courts are subordinate. So, its precedents are the law of the land unless and until the U.S. Supreme Court modifies the holding of one of its prior decisions.
    – ohwilleke
    Commented Jan 26, 2017 at 22:42

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Mandatory arbitration clauses specify a particular type of dispute resolution, excluding resort to the court system. A class arbitration waiver prohibits more than one similarly situated person from joining forces - in arbitration - to pursue their claims together. The former may exist without the latter, though this is less common than before the holding in AT&T v. Concepcion.

Mandatory arbitration clauses were already commonplace (and frequently enforceable) before AT&T v. Concepcion. The key issue in that case was whether the class arbitration waiver was enforceable: indeed, it was.

The customers suing AT&T had been successful in the lower courts by relying on California case law, under which some class arbitration waivers were not enforceable. The U.S. Supreme Court held that such case law was inconsistent with, and thus preempted by federal law--the Federal Arbitration Act.

The calculus for whether an arbitration clause is enforceable did not change much in light of AT&T v. Concepcion. However, now, when it is enforceable, it may require that each person with a complaint pursue it individually.

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We have an answer on stare decisis and precedent.

After the Supreme Court decides a case, if a lower court rules on a case with the same fact pattern as the previously decided Supreme Court case, they are bound to come to the same outcome.

They can arrive at a different outcome only if they find aspects of the new case that materially distinguish it from the Supreme Court case.

Regarding the specific case you mention, my reading of AT&T Mobility LLC v. Concepcion 563 U.S. ___ (2011) is that it holds that consumer contracts can include clauses that prohibit class-wide-arbitration.

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  • ok. so supreme court cases do set a precedent for cases with a specific set of circumstances, but not for all cases regarding the general subject. So in this case, people cannot sue cell phone companies for charging taxes on free phones, but that doesn't necessarily mean that if a specific company's phone (not related to telephone service, btw) blows up and melts someone's face off, that they can't sue due to some clause that they didn't technically sign, which could have been included in the packaging when they purchased the phone (hypothetical example). is this correct?
    – Sebastian Hahn
    Commented Jan 26, 2017 at 22:52
  • but can and will these types of clauses be legally upheld in all cases (regardless of circumstances)? If so, then the precedent needs to be changed, as it violates consumer rights (regarding expectations of product safety and vendor accountability).
    – Sebastian Hahn
    Commented Jan 26, 2017 at 23:42
  • also, is including such clauses and other contracts inside product packaging, as mandatory opt in (which assume consent unless the consumer either opts out or returns the item, as opting out isn't always an option), which the consumer doesn't see and isn't aware of until after a purchase has been made, really legal? I wouldn't describe such "contracts" as evidence of informed consent.
    – Sebastian Hahn
    Commented Jan 26, 2017 at 23:51
  • Some Supreme Court rulings are broader than others, and a lot of "inside baseball" commentary about Supreme Court rulings concerns how broad particular opinions are. AT&T Mobility LLC was a pretty broad ruling, although subsequent cases have explored issues it didn't touch upon. Certainly "informed consent" is not the relevant legal standard, which is close to "notice that can be discerned with careful inspection, if one chooses to do so." The precedents flow from a liberal reading of the Federal Arbitration Act which could be reformed by Congress if it wished, but which it has not reformed.
    – ohwilleke
    Commented Jan 27, 2017 at 1:43

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