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AT&T has asked a federal court to put a consumer class action lawsuit on hold and send the plaintiff’s claims to arbitration.
The company says that instead of bringing a class action lawsuit, plaintiff Eric Zatt must arbitrate his claim that AT&T ran a bait-and-switch scam with some of its prepaid phones and services.
AT&T argues that an arbitration provision in Zatt’s contract for service requires him to resolve any disputes with AT&T through arbitration.
In its memorandum supporting its motion to compel arbitration, AT&T says that Zatt agreed to arbitrate any relevant disputes back in March 2009, when he purchased a different phone from an AT&T company-owned retail store.
The company says that contractual provision is “fully enforceable” under the binding precedents of several federal appeals courts, including the U.S. Supreme Court.
AT&T further argues that the Federal Arbitration Act requires enforcement of arbitration provisions like the one in Zatt’s service contract. The act manifests a “liberal federal policy favoring arbitration agreements,” the company says.
It applies to written arbitration agreements in contracts that evidence a transaction involving commerce, the company says. The arbitration provision in Zatt’s contract meets those criteria, triggering the FAA’s enforcement requirement, AT&T argues.
The company claims that the U.S. Supreme Court upheld a “materially identical AT&T arbitration provision” in an earlier decision, AT&T Mobility LLC v. Concepcion. Since that decision, every court that has considered AT&T’s arbitration provision has enforced it, the company says.
AT&T also argues that language within the contract’s arbitration clause prevents Zatt from bringing this or any other claim against the company as a class action lawsuit.
The company quotes language from the contract stating that Zatt may bring a claim against AT&T only in his individual capacity. The language purports to prevent Zatt from acting as the lead plaintiff or as a Class Member in a class action lawsuit or similar proceeding.
Zatt initiated his AT&T class action lawsuit earlier this year. He alleged that the packaging on certain AT&T prepaid GoPhones offers customers a 10 cents per minute service plan that does not actually exist.
He says that after purchasing the phone and attempting to activate it, customers discover that AT&T does not actually offer the 10 cents per minute plan.
According to Zatt, the customer can’t know that the 10 cent plan isn’t an option until after they have purchased the phone. At that point, he claims, the customer must choose a more expensive plan to avoid being stuck with a useless phone.
If Zatt can keep his AT&T class action lawsuit out of arbitration, he will seek to represent a plaintiff Class of all persons in the U.S. who bought an AT&T GoPhone and were subject to the promotional materials advertising a 10 cents per minute plan.
Zatt is represented by attorney Stephen R. Basser and Samuel M. Ward of Barrack, Rodos & Bacine.
The AT&T Prepaid GoPhone Bait and Switch Class Action Lawsuit is Eric Zatt v. AT&T Corp., et al., Case No. 3:16-cv-01323, in the U.S. District Court for the Southern District of California.
UPDATE: On Sept. 9, 2016, Zatt opposed the prepaid cell phone provider’s motion to compel arbitration, stating that because he never activated his GoPhone, he never agreed to arbitrate his claim.
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2 thoughts onAT&T Seeks to Compel Arbitration of Bait-And-Switch Class Action
UPDATE: On Sept. 9, 2016, Zatt opposed the prepaid cell phone provider’s motion to compel arbitration, stating that because he never activated his GoPhone, he never agreed to arbitrate his claim.
It’s about damn time….