. . . the Honorable Sam Cianchetti, Los Angeles Superior Court Judge (ret.) for his decision awarding $8.4 million in punitive damages, for a total $9 million award, against Health Net In the Arbitration between Patsy Bates and Health Net, et al.
Los Angeles Times article here and the opinion itself here.
UPDATE: For coverage of this case within the industry see The National Underwriter post here.
This one is Lowden v. T-Mobile USA decided today by the Ninth Circuit.
We conclude that the Washington State Supreme Court’s decision in Scott v. Cingular Wireless, 161 P.3d 1000 (Wash. 2007), establishes that T-Mobile’s arbitration provision is substantively unconscionable and unenforceable under Washington state law, and that there is no federal preemption in light of our decision in Shroyer v. New Cingular Wireless Servs., Inc., 498 F.3d 976 (9th Cir. 2007).
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It is mediation creed that Americans don't like to bargain. If they did, there probably wouldn't be mediators or Hollywood agents.
Now the New York Times tells us why. After World War II, we had a virtual monopoly on consumer goods. Our negotiation skills took a hike in the woods and never returned.
Anyone who wants to save a few bucks on the purchase of consumer goods without the assistance of a professional negotiator should read today's New York Times article -- For Champions of Haggling, No Price Tag is Sacred. Advice by Herb Cohen, author of the best seller “You Can Negotiate Anything” below.
As Jeffrey Gordon over at the Software Licensing Handbook cogently explains in his post on Strategic Thinking, "when faced with a negotiation [it is important to] sit down and ponder your moves."
If you come out guns blazing, the other side is probably going to respond in kind. Which means that you’re setting the stage for an aggressive negotiation and will be fighting for things along the way. On the other hand, too soft, and you’ll give up everything. This is where some of the experts obviously advise differently. One camp says “play stupid” and seek what you can get through self-depreciating behavior. Another camp (pardon the pun, but it’s actually Jim Camp) says that you should always “Start with No” as a way to encourage discussion.
The net result of Strategic Thinking is an ability to not only see what your path could be, but to also see where your opponent is going to move. For if you play a win-win strategy against someone with a win-lose strategy, who do you think is most likely going to lose? If you’ve considered your various options and thought Strategically, you’ll know how to respond.
Strategic Planning: Negotiation "Style"
Though Gordon talks about planning ones negotiating style ("hard" or "soft") I always lead with a style that is "hard on the terms and soft on the people." As a matter of negotiation "style" I also
I also recognize and attempt to guard against my weaknesses which are:
Strategic Planning: Setting Ones Reservation Price; Planning the Number and Timing of Concessions; and Deciding Which Information Will Be Strategically Deployed
My own pre-game strategic planning primarily consists of setting my "reservation price" (the number I will not go below); projecting the planned timing and number of concessions; and, deciding on the nature and timing of information disclosures that I believe will enhance my bargaining position. I also make a decision, in a case like this, whether I wish to aggregate or divide the several items subject of the bargain.
So What Was the Actual Plan?
We were lucky to have both several items to negotiate and several preferences for each negotiated item. What were they?
We decided that I would be the primary negotiator with Mr. Thrifty as my back up.
I knew there was a lot of "fat" in the furniture. The purported "retail" price for the "wood veneer" television stand was $598, "reduced" to a "sales" price of $398. Having checked online prices for this piece if furniture, I knew that at least one online store claimed that its "retail price" was $349 -- $50 more than the Ken Crane's claimed "sale" price and that we could purchase it online for $285, $110 less than the store was offering.
Though we were unable to obtain comparables for the Toshiba -- tagged at $2598 -- we knew we could buy a comparable Samsung for $2300 over at Fry's Electronics in Burbank.
Mr. Thrifty and I decided that our reservation price (or bottom line) was $3,000.00 for all of the items listed above, which would be $366 less than "retail."
Although I firmly believe we could have negotiated a deal at that price, we concluded the deal $150 short of our "reservation price." I'll explain why that happened when we cover time management and perception of power in our final post on negotiating consumer purchases.
(photo Destiny Calls by Neal Sanche)
Is there any negotiation more frustrating than the one you conduct on the telephone with people who won't give you their last names, have no "authority" to do or say anything that deviates from their script and who you are finally connected to only after enduring the "go ahead, try to choose the right numeral to fit your problem" automated phone system.
I'll include some of these conversations in the series on negotiating the purchase of the flat-screen T.V.
This post, however, is an emergency act of mercy for anyone who is upgrading their DirecTV non-HD DVR service to either Dish or DirecTV HD-DVR system.
Information Gathering Cut Short
After at least one full hour of searching online, I found this clear, easily understood, linked resource entitled My Dish Network vs Direct TV Experience. This advice page links to a side-by-side comparison of the HD-TV-DVR "deals" being offered by satellite providers here at the DigitalTVDojo Daily Deal Monitor. The "Deal Monitor" links to the "secret" web deals that you will not be offered on the telephone or the internet unless you find them.
But that's not all.
Gathering Information about the Dish Service
Preface: After the Dish representative dodged the following question four times, I gave her one last chance, telling her she would lose my potential business unless she answered it. She didn't. I called DirecTV for the second time that day.
The question: will you provide me with a 5 LND dish free with the HD service?
What the question means: I have no idea. My rocket scientist neighbor told me that's what I needed.
Back to DirecTV
If you, like us, are existing DirecTV customers, you cannot get the "deal" linked above online. If you sign in to your account (or create an existing user account) the only "deal" available to you is to pay $299 for a new HD DVR (which you understand you are leasing, not purchasing).
Here's who you have to call to get the same deal being offered to new customers: The Customer Retention Department.
How do you get there? Press 0 even though you're not given this option, which may not directly connect you to a human operator, but will lead you to one more quickly than any other means I tried.
How I Got to the Customer Retention Department
I spent a lot of time appealing to DirecTV's "higher value" of customer service and its interest in retaining customers. I said the words "Dish" alot. I said, you're not a monopoly and you have the power to lose a customer today. That sort of thing.
But all this effort bought me was access to the Holy Customer Retention Department.
So don't bother negotiating your way there. Just ask to be directly connected.
The Deal the Customer Retention Department Will Give the Existing Customer
(please let me know if you do better -- Thad Employee # U2179 represented to me "as a matter of fact" that this was absoutely the best deal any existing customer could get on an HD-TV DVR upgrade. I'm hoping no one proves to me that Thad misrepresented the available deals because I'd like to continue to believe that when directly asked this question, my negotiating partner will either say -- I cannot guarantee that -- or tell me the truth. I'll provide a link for misrepresentations during negotiations and negotiation ethics later).
Here it is: DirecTV will:
That's it. Happy shopping and thanks to all the selfless TV service bloggers who helped along the way.
(the Toshiba 46LX177 46" REGZA™ Cinema Series® 1080p LCD HDTV with 120Hz refresh rate; our vendor - Ken Crane)
I have long complained that high definition television is the triumph of form over the "content" our 500-plus channels deliver to us.
Nevertheless, the February 2009 deadline to go digital is, more or less, looming. Not to mention the fact that today is our first wedding anniversary and the seventh day of Hanukkah. Christmas is just around the corner.
That confluence of events provided the rationale, the justification for me and Mr. Thrifty to finally bite the H.D.T.V. bullet and negotiate the purchase of technology that would likely cost us more than each of us paid for our first automobiles.
Before putting your non-bargaining toes in consumer negotiations, you might want to take a peek at the U.K Telegraph article The art of being a winning negotiator, our knowledge of which we owe to Diane Levin at the Online Guide.
There's not a lot that's new in the Telegraph's report of a five-day Oxford negotiation program for seasoned professionals -- first "identify what you want, what the other side is likely to want, what you can discover from the public media [and then] build relationships with the other party, picking up intelligence which couldn't be gathered in advance such as his personality, mood, style of negotiating, constraints."
What struck me as noteworthy was the article's expressed surprise that people 'at the top of their game' professionally would feel the need for a course in negotiation.
This is not news to someone like me who realized on my first day of mediation training that I'd been negotiating the settlement of litigation for 25 years as crudely as Cullen, director of the Oxford Programme, said sophisticated business people tend to do. They "negotiat[e] fairly crudely," he said, and "hadn't realised how they could do it so much better."
As I sit at home today waiting for delivery of the TV at the top of this post, I'm going to take my readers on a step-by-step guide to buying the high-end technological gee-gaw of your choice this holiday season. Or, because we don't watch television all that much, the mid-market Flat Screen High Definition LCD T.V., with accessories and furniture.
High-market, mid-market or low-end, one negotiation is as easy or tough as another depending upon your negotiation skills. And to tell you the absolute truth -- those lawsuits with the least in controversy are generally the most difficult to negotiate.
But I digress.
Step No. 1: Preparation, next.
(photo: Amanda Graham's Outlier)
I have Christina Doucet at the National Arbitration Forum to thank for summarizing some of the most recent statistical literature available on differences between procedure, cost, duration, outcome and party satisfaction of litigated and arbitrated consumer and employee disputes.
Time and Cost Differences Between Arbitration and Litigation
Sources: Consumer and Employment Arbitration in California: A Review of Website Data Posted Pursuant to Section 1281.96 of the Code of Civil Procedure California Dispute Resolution Institute, August 2004 http://www.mediate.com/cdri/cdri_print_Aug_6.pdf and Examining the Work of State Courts, (1999-2000) National Center for State Courts http://www.ncsconline.org/D_Research/csp/1999-2000_Files/1999-2000_Tort-Contract_Section.pdf
Outcome Differences Between Arbitration and Litigation: Arbitration & litigation final awards are essentially the same as court judgments
Yesterday, I promised to provide a little "pro" arbitration wisdom in response to my speaking partner's "con" since that's our ALFA Seminar topic here in beautiful Half Moon Bay.
And yet it's 4 a.m. before I realize I can't sleep because I've been mediating too long to seriously launch one side of any debate. Everything and everyone has become so much more three-dimensional, multi-layered, and textured as a result of three full-time years of ADR practice.
So let me share the first of my non-scripted thoughts on the matter.
I'm Unwilling to Prejudge the Court's, the Arbitrator's or the Jury's Biases.
If you read yesterday's post, you'll recall that several of the anti-arbitration arguments were based upon the presumption that the arbitrator will more likely than not be biased in favor of the plaintiff because:
Having spent 25+ years with attorneys, judges, mediators and arbitrators, I simply can't assume bias. A few bad apples aside, the men and women of the legal profession are among the most ethically-minded of any professional or business people I have known -- by many, many, many degrees of magnitude.
Continue Reading...
(photo: Employees Only by Michelle Thompson)
While most of the arbitration news of the week is about the unfair advantage given to corporate "repeat players" in the arbitration of disputes, Senior Legal counsel for DHL counsels employers to abandon arbitration's ship and swim back into litigation's pacific waters.
Though I'm the "pro" arbitration speaker with DHL in-house counsel Joshua Frank at this week's ALFA Labor & Employment Practice Group Seminar in Half Moon Bay, I don't have strong feelings one way or the other (preferring, as you can imagine, the negotiated, to the adjudicated, resolution).
Mr. Frank's reasons for suggesting that the Courts are a better forum for employers and arbitration better for employees?
(photo: Lerach in action from SF Gate article on HP lawsuit)
We learn from today's New York Times that "securities lawyer William S. Lerach is expected to plead guilty today to a criminal conspiracy charge in connection with a[n alleged] class-action scheme involving his former firm, now known as Milberg Weiss . . . "
I've heard Mr. Lerach speak on several occasions. His passionate defense of the rights of small investors has, it's true, earned him a great fortune. I have never doubted, however, his integrity or the depth of his commitment to bring corporate wrongdoers to justice. I'm certain that I am not alone in wishing him well.
I note that his plea agreement protects those who worked with and for him and does not require him to cooperate in the government's efforts to pursue others who have also worked for the benefit of the "little guy."
As the Times reports:
Mr. Lerach, who has long been under investigation by federal authorities, is expected to enter his plea in United States District Court in Los Angeles. Under the plea deal, he faces one to two years in prison, and will also pay a significant fine . . .
Mr. Lerach’s plea comes amid a seven-year investigation into whether he and other senior lawyers at Milberg Weiss conspired to pay kickbacks to individuals who agreed to serve as named plaintiffs in class-action lawsuits.
One person with knowledge of the plea deal said that Mr. Lerach would plead guilty to being aware of one such incident. . . . .
For years, Mr. Lerach and his former firm aggressively filed class-action lawsuits, particularly in the securities area. Being the first to organize and file suits also put them in position to get a sizable share of any legal fees produced by the cases.
Mr. Lerach, who did not return a telephone call to his office, long championed the class-action system as an equalizer for small investors and other plaintiffs seeking redress of corporate wrongdoing. . . . .
Under the plea agreement, Mr. Lerach is not required to cooperate with the government in any further inquiries into the matter . . . The agreement terms, they said, also call for the law firm from which Mr. Lerach recently resigned, Coughlin Stoia Geller Rudman & Robbins, to face no liability or risk. . . . .
For the remainder of the article, click here.
(for our Canadian readers, our featured treatise is Litigating Conspiracy: An Analysis of Co
mpetition Class Actions , Stephen G.A. Pitel, Ed.)
An excellent concise summary of Gentry v. Superior Court, where the California Supreme Court Questions Enforceability of Class Action Waiver on Public Policy Grounds is once again provided by the National Arbitration Forum, excerpt below.
By a 4-3 majority, the California Supreme Court reversed an order compelling arbitration and remanded the case to the trial court with instructions to use a multi-factor test in determining the enforceability of a class action waiver. The ultimate question for the trial court is whether class-wide proceedings would be “a significantly more effective practical means of vindicating the [statutory] rights” of the employees who belong to the putative class. Parties who prefer the simplicity of one-on-one arbitration should not be overly concerned by the majority holding because this decision has no application outside of the employment context.
For full text of NAF's summary, click here.
This pdf of the opinion comes to you courtesy of Jeffer Mangels Class Action Defense Blog with Jeffer's excellent case analysis from a defense perspective here.
Another good and thorough analysis appears here. Gentry v. Superior Court - California ruling on class action waiver in arbitration agreement.
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(pictured: an overdressed 1985 Motorola Cell Phone from Bulletz of Knowledge post Dress the Elderly Cell Phone)
For the business, rather than a strictly legal, analysis of the recent Ninth Circuit and other California rulings on the unconscionability of consumer arbitration clauses, see the excerpt and link to Business Week's article on the issue below.
Read almost any cell-phone contract and you'll discover that the longest passage deals with dispute resolution. While seemingly important matters like billing get only one paragraph, Verizon Wireless devotes six paragraphs to dispute resolution. At AT&T (T), the dispute section takes up 10 fat paragraphs and states: "You agree that, by entering into this Agreement, you and AT&T are each waiving the right to a trial by jury or to participate in a class action."The small print keeps expanding in response to an influx of court cases—at least 10 of them in California over the past few years—questioning a wireless carrier's right to block consumers from suing or filing class-action claims. In late June a California appeals court reaffirmed a lower court's order that (T-Mobile USA) could not enforce a clause requiring arbitration of disputes with customers. And on Aug. 17, the U.S. Court of Appeals for the Ninth Circuit in California ruled that AT&T's prohibition against subscribers banding together in class actions, "is unconscionable, and, thus, unenforceable."
According to the ABA Journal Law News two Democratic lawmakers have introduced legislation that would prevent the inclusion of mandatory arbitration clauses in consumer contracts as well as those contracts implicating the consumer's civil rights.
Though the parties could still agree to arbitrate their disputes after they arise, the bill would make unenforceable pre-dispute arbitration provisions within the scope of the legislation. Article here and except below:
Two Democratic lawmakers have introduced legislation that would bar enforcement of some mandatory arbitration agreements.
The Arbitration Fairness Act would bar mandatory arbitration agreements involving employment, consumer rights, franchises or civil rights, according to a press release.
Agreements to arbitrate in these areas could be made after a dispute arises, but not before.
The law is designed to prevent consumers from being forced into arbitration.
To continue reading, click here.
(photo by 
Ken Douglas)
For some of the reasons your clients might not want to include arbitration clauses in their consumer contracts, see the Metropolitan Corporate Counsel Article on Class Arbitration by P. Christine Deruelle and Robert Clayton Roesch of Weil, Gotshal & Manges LLP.
Excerpt on the Perils of Class Arbitration below:
First, the scope of review available for an arbitrator's ruling is significantly limited. . .Second, the conventional time and cost-savings of arbitration may be lost in class proceedings, since each of the interim phases related to class- and merits- arbitral awards will carry with them potential burdens relating to discovery, briefing, hearings, and time, money and effort spent in obtaining judicial review at each of the various phases, which will not necessarily be present in individual arbitrations.
Third, the parties' arbitrator selection process will likely be guided by different factors in a class arbitration proceeding than in an individual arbitration, since the fate of all of the class claims will be decided by a single arbitrator or panel.
Fourth, the specter of class arbitration disposes of the presumption of privacy and confidentiality in arbitration.
Part II of this two-part article will address potential means for companies and practitioners to attempt to avoid these and other pitfalls of class arbitration.
Don't let this summary lead you to believe that this article is not extensive, thorough and deep. If this is a topic of interest to you, this is one of the best articles on the topic I've seen. Do click on the above link and take a peek.
What Does a Class Action Lawyer See (right)? CLIENTS!
The AP reports a proposed class action settlement (pending judicial approval) of $10.5 million. If you read between the lines of the report, you'll see that this was apparently a good deal for the defendants.
Why? Because the Board of Directors charged with encouraging their employees to place their pension funds in risky investments (ENRON ring a bell?) did not simply hunker down in a defensive posture when sued, but instead provided the company's former employees with "numerous enhancements" to their pension benefits.
According Plaintiffs' counsel Steven Krasner, "[t]hose benefits were very substantial If you add the $10.5 million to that, they did a pretty decent job to make people whole."
The defendants' public statement was the usual -- "[i]t's always more efficient to resolve the issues in a case rather than follow through the courts" -- according to spokesman Al Butkus.
Though the public generally sees a statement like this to be corporate %$^#, as we all know, it also happens to be the actual verifiable truth.
The Strategic Defensive Use of the California Consumer Legal Remedies Act
The California Consumer Legal Remedies Act, by the way, is a good face-saving device to bring your clients into strict compliance with consumer demands, thereby sharply reducing the settlement value of the class action or 17200 suit that invariably follows.
The CLRA requires a pre-suit demand by the plaintiffs, thereby giving the defense an opportunity to mend its ways.
In my own litigation experience, compliance with a CLRA demand to change the way a product or service is advertised is a relatively pain-free way to drastically reduce your clients' damage exposure. My client did this in response to an accusation that its advertising was misleading. Though we disagreed, the client nevertheless changed its advertising to reveal the allegedly concealed transaction fee.
As a result, Plaintiffs' counsel accepted an unprecedented injunction-only remedy coupled with a few hundred thousand dollars in attorneys fees to settle the case -- a far better deal than the dozens of other defendants in this national class action were able to achieve.
Why?
First, because our compliance with the CLRA demand made our client look like a good guy -- ruining the Plaintiffs' "spin" that all defendants were evil profit hungry businesses preying upon innocent victims (cf. the new Glenn Close series Damaged).
Second, because the Plaintiffs' attorneys (who are, remember, people) were favorably impressed and kindly disposed to us after we complied with their demand rather than simply burying them in paperwork -- well, we did also bury them in paper by strictly complying with their document demands, but that's litigation -- speak softy, carry a stick and remember the rule of reciprocity.
(click on image to see consumer law attorneys Horwitz, Horwitz & Associates)
Financial Week reports today in SEC and Congress gang up on arbitration that "[l]egislation in Congress would block mandatory arbitration clauses" in all instances. As the article notes,
Bills introduced by Sen. Russ Feingold (D-Wis.) and Rep. Hank Johnson (D-Ga.) would make pre-dispute arbitration agreements invalid and unenforceable. Mr. Johnson called mandatory arbitration an “albatross” for investors. “Despite what companies may say, it is not more affordable than going to court,” he said.
Zach Lowe, a spokesman for Mr. Feingold, said the legislation reflected concern over a push in the corporate world to allow mandatory arbitration and the overuse of such clauses in broker-dealer contracts. The Senate bill said that mandatory arbitration “undermines the development of public law for civil rights and consumer rights because there is no meaningful judicial review of arbitrators’ decisions.”
This legislation, if enacted, would affect so many powerful corporate instances that I wouldn't hold my breath for its passage any time during this century. Still, it will be interesting to follow the debate.
As I've often said here, I favor negotiated agreements, not obligations imposed by a party with superior bargaining power on a take it or leave it basis. This is particularly true in consumer contracts where the print is fine, located only on web sites and/or imposed in the middle of a contract term by way of notice contained in a consumer's bill.
Because self-regulation often follows Congressional regulatory trial-balloons, the best consumers can likely hope for will be increasing attempts by service providers of all stripes to make arbitration a genuine choice for its customers.
And while you're over at Horwitz, check out their blog, particularly this post on frivolous lawsuits (my own post on frivolous lawsuits can be found here).
(photo: Cohdra at MorgueFile)
Friday the thirteenth was (temporary) bad luck for Canadian consumers. I say temporary because Ontario and Quebec have forbidden mandatory arbitration clauses and class action waivers. The Canadian Supreme Court in the two cases discussed below held that in the cases before it those statutes could not be applied retroactively.
Though no Canadian Law expert (I was hipped to the Dell opinion by my Canadian buddy Michael Webster of the Due Diligence and Misleading Advertising Blog) it appears that a Dell mandatory arbitration and class action waiver clause is not against Canadian public policy (referred to by the Court as not against "public order.") See the Canadian "The Court" Blog's article, "Is the Class Action a Public Order Institution," excerpted below.
Ironically, when the Dell and Rogers cases are placed in a larger social context, the public’s interest in securing the class action as a vital aspect of the public justice system could hardly have been rendered clearer. The Rogers case received much less of the court’s attention, having been carried through on Dell’s slipstream; however it is the features of Rogers’ mandatory arbitration/class action waivers on its consumer contracts that highlight the hollowness of off-the-bench judicial laments about access to justice for ordinary Canadians.
Both cases turned on the sublimely procedural question of whether an arbitrator or a Quebec superior court judge should have first kick at the can in deciding whether a mandatory arbitration clause on a consumer contract was enforceable or not. Such clauses preclude consumers from pursuing corporations in any kind of court action, including class action.
In both Ontario and Quebec the question has been rendered moot by amendments to consumer protection legislation which prohibit such clauses, underlining the public order aspect of the class action.
Read the rest of the article here (emphasis added).
(photo by Vilanova, MorgueFile)
In this federal case, the Ninth Circuit held that the addition of an arbitration clause to the cell phone service contract, imposed by way of the posting of a revised contract on its website with no pre-existing notice to its subscribers was unenforceable. The class action plaintiffs were therefore not required to arbitrate their claims and the class action waiver (also imposed upon subscribers in this same manner) was unenforceable. Douglas v. United States District Court for the Central District of California.
Click on the image to see the article.
Don't get us wrong.
We like arbitration when the parties have genuinely contracted for it.
We're not great fans of adhesion contracts, however.
Never have been.
Never will be.
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Ascertaining All of the Terms and Conditions of Your Cell Phone Service
(I'm using Sprint as an example only because the question posed to me related to Sprint -- I'm assuming most cell phone service agreements are the same, or at least substantially similar)
Because a reader asked, I learned today that the Sprint Cell Phone Service Agreement contains an arbitration provision.
How did I gain this valuable knowledge? Read on.
A Trip to the Grocery Store
On my way to the grocery store this morning , I drove by a Sprint outlet. So I stopped, ran in, and had the following conversation with the Sprint representative.
"Can I get a copy of Sprint's service contract?"
"Huhhhhhhhhhh?????????"
"You know, the terms and conditions of the Sprint cell phone service plan."
"Uhhhhhhhhhhhhhh -- you mean the, uh, Plan Brochure?"
"Does it have all of the plans' terms in it?"
"Terms?"
"You know, the FINE PRINT? the contract? the parties' agreement if I sign up for service."
Smiling, "sure," she replies, handing me the brochure and graciously validating my parking ticket (the one with the waiver of the car park's legal responsibilities to me or my car printed on the back in 3-point type).
Now that I've Read ALL the fine print in the Sprint brochure, I can tell ou that there is nary a mention, hint, suggestion or covert reference to "dispute resolution" or court or jury trials or arbitration.
Nothing, Nada, Nichts.
I Should Have Gone On-line in the First Place to Find the Sprint "Terms and Conditions" of Service
At the very bottom (left hand corner) of Sprint's Plan Page you will find a link titled "Terms and Conditions."
That's where you'll find your Sprint Cell Phone Service Agreement -- that adhesion contract I was talking about in my last post. It is here where you will find that by signing up with Sprint (and likely all other cell phone providers) you agree to waive your Constitutional right to a jury trial [except in California where the Supreme Court has refused to enforce pre-dispute jury trial waivers such as that required by Sprint here] and your Constitutional right of access to the courts.
You also consent to submit any dispute you have with Sprint to binding arbitration under the authority of the Federal Arbitration Act and the rules of the National Arbitration Forum.
The Arbitration Agreement Verbatim
Your Agreement with Sprint Solutions, Inc. . . . includes terms of your service plan . . . and the most recent Sprint Nextel Terms and Conditions of Service . . . carefully read these all terms which include, among other things, a MANDATORY ARBITRATION of disputes provision.
The dispute resolution clauses are at the end of the Terms and Conditions (T&C's). They provide as follows:
Continue Reading...A reader's inquiry (does the Sprint cellphone contract contain an arbitration clause?) alerted me to cell phone company "escape" clauses courtesy of the Consumerist Blog's post Materially Adverse Clauses for All Major Cellphones-So You Can Escape a Contract without a Termination Fee.
THE ANSWER TO THE QUESTION IS: YES. SEE NEXT POST FOR DETAILS
This is consumer reporting at its finest. The "little guy" has been fighting (and sometimes winning) the battle of the adhesion consumer contract for years (see the Wage Law Blog's coverage of the California Supreme Court's decision in Discover Bank).
(For non-lawyers, an "adhesion" contract is one you didn't really agree to because, for instance, it came as an insert with your monthly cell-phone or credit card bill or appears on the back of the ticket you pull when you enter your local mall's parking lot. It's an asymmetrical contract. The party imposing the agreement on you has all of the power and you have none. Take it or leave it. That's an adhesion contract and it's not necessarily -- in fact is often not -- invalid).
That said, it appears that most cell phone contracts contain a clause permitting you to terminate your service before the expiration date without a cancellation fee (a real boon if you want to change plans!)
You may generally do so "in response to a materially adverse change [the cell phone company] makes to the Agreement . . . (Sprint Contract language). The imposition of an arbitration provision that wasn't part of the contract when you sign it would be a material adverse change (I'm actually willing to go out on a limb here and say that's my actual legal opinion).
Sprint requires you to provide it with notice of cancellation within thirty days of their notice to you of the change (as I suspect all the other cell phone services do). So if you want to take advantage of this, you'd have to begin reading those inserts that come with your cell phone and credit card bills.
Enter keywords:
