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DirecTV Contract Issue Regarding Arbitration Reviewed by US Supreme Court

Monday, October, 12, 2015


Recent efforts made by unhappy customers of the television service provider DirecTV to file a class action lawsuit continue to hang in the balance. Previously, a California appeals court refused arbitration and allowed for the class action suit. Now, the Supreme Court, in an attempt to reverse the appeals court decision, has stated it believes the suit is “too big and too small.”

 

Historically, the Supreme Court has shown hostility to class action suits and favored arbitration.

 

The DirecTV case appears to go against the Supreme Courts usual attitude regarding class action, but there is also concern the court might be in over its head. Justices seem to think the appeals court went too far, but are not sure why they are hearing the case over trivial matters like late termination fees. DirecTV had already abandoned one of the issues in contention and at least one judge questioned why the court’s opinion was warranted on a defunct contract matter.

 

The justice further acknowledged the appeals court was wrong, but pointed out the job of the Supreme Court is not to rule on that matter, but to look at the broader picture – and correct incorrect legal principles.

 

Other justices are concerned a decision on the matter could have sweeping implications, making the case far too large of a “can of worms” for the Supreme Court to open. Ruling against arbitration would open up every case settled in arbitration to questions. He believes the ruling would federalize a huge area of state contract law.