Concepcion Looms Large, As Court Summons “Large Animal” and “Tanker of Ink”Images For The Case -- And Its Wake
The issue in Selby v. Cingular Wireless LLC, Case No. G045769 (4th Dist. Div. 3 January 29, 2013) (Bedsworth, J., author 3-0) (unpublished), was whether the customer of a cell phone carrier could state damage under the California Legal Remedies Act (CLRA) because she had incurred legal fees successfully opposing Cingular’s motion to compel arbitration back in 2005. Unless the plaintiff suffers some “damage” from enforcement of a contract provision alleged to violate the CRLA, the plaintiff lacks standing to sue under the CRLA. Meyer v. Sprint Spectrum L.P., 45 Cal.4th 634 (2009).
Unfortunately for the plaintiff, none of the contractual provisions she claimed violated the CLRA had ever been enforced against her (with one exception), and therefore under Meyer, she could not state a claim for damages as to those claims. The one exception was that back in 2005, she had successfully opposed Cingular’s motion to compel arbitration, thereby incurring fees -- arguably “transaction costs” constituting damages.
As to the motion to compel arbitration, however, AT&T Mobility v. Concepcion, 131 S.Ct. 1740 (2011) has changed the legal landscape. In the colorful language of Justice Bedsworth, Concepcion is “so significant a tanker of ink has been spilled about it in less than two years after it was handed down . . . . Concepcion is the large animal in this room.”
Tanker of oil. Public domain work of sailor or employee of U.S. Navy. Wikimedia Commons.
Concepcion – a case involving the very same defendant, Cingular (called AT&T in the opinion) – held that the Federal Arbitration Act made arbitration agreements valid and enforceable, save “upon such grounds as exist in law or in equity for the revocation of a contract.” The most common exception under the “savings clause” is unconscionability of the contract. In Selby, however, the Court believed that it would be “a perversion of state law unconscionability doctrine” to apply the doctrine to a situation in which the consumer “picked the fight in the first place,” making no claims of “any damage” arising from the non-arbitration she attacked. Her costs, Justice Bedsworth wrote, “are the legal equivalent of a self-inflicted wound, and cannot be regarded as recoverable transaction costs.” Selby’s claims based on Cingular’s enforcement of its arbitration right, covered by Concepcion and the FAA, lacked merit.
Margate Elephant, Margate City, Atlantic County, N.J. U.S. Government photo. Library of Congress.