Wednesday, January 11, 2012
Yesterday, the U.S. Supreme Court issued its decision in CompuCredit Corp. v. Greenwood. In an opinion that was unsurprising according to the folks over at the ADR blog (that is, according to Sarah Cole and Paul Kirgis), SCOTUSblog provides coverage as well here. Justice Scalia, writing for the majority, enforced an arbitration clause in a credit card agreement, reversing the Ninth Circuit, which had found the clause inconsistent with the Credit Repairs Organization Act (CROA). Justices Kagan and Sotomayor concurred. Only Justice Ginsburg dissented.
The Ninth Circuit and the District Court had ruled that the arbitration clause was void because of language in CROA secuiring for consumers the "right to sue" and there are also references to class actions and to courts. The opinion was unsurprising, according to the ADR Bloggers, because similar language has been construed in previous cases and, as Sarah Cole concludes, "Until Congress decides to make it clear that a particular statutory claim cannot be arbitrated, the Court will continue to find that statements like “right to sue” and “cause of action” cannot be construed to avoid application of the FAA."