CA Judges Issues Opinions That Tmobile's Mandatory Arbitration Agreements Are "Unconscionable" And "Not Enforceable"

A California judge issued an opinion that Tmobile’s contract terms forcing customers to go into arbitration instead of being able to sue were, “unconscionable and therefore not enforceable,” reports BoingBoing.

Judge Linda Gemello opines that T-mobile can’t compel arbitration, based on the fact that the contract is unconscionable. Another judge, Mark Simons, “concurs” with Gemello. Barbara Jones, concurs but dissents, saying, “I cannot agree that the contracts are also procedurally unconscionable. In my view, plaintiffs do not show, on the record before us, either surprise or oppression to support their procedural unconscionability claim.” Jones goes on to say that customers had a 14-day return period after they signed the agreement and that they could have chosen not to go with T-mobile, therefore she believes that the motion to compel arbitration should be granted… but she does go on the record to say that she agrees with her other buddies, just not completely.

Dissent aside, a class-action suit suing Tmobile over their non-prorated early termination fees (ETFs) and locking of cellphones now has the possibility of moving forward

All of the major cellphone carriers have implemented arbitration agreements into their customer contracts, not to mention ETFs and cellphone locking.

Consumerist dislikes mandatory arbitration agreements as they effectively remove one of the last resorts consumers have to punish companies for abusive practices.

Go California, the state where it’s illegal for rebates to lose value!

CA court rules T-Mobile contract terms unconscionable [BoingBoing]
Gatton et al. v. T-Mobile USA [PDF]
(Photo: medalian1)


Edit Your Comment

  1. Trai_Dep says:

    That’s pretty awesome. It’s almost impossible to avoid these arbitration agreements, and if they’re forced upon consumers, it will be really difficult to provide pro-consumer arbitrators, since, after all corporations are their core constituancy. I’d be okay w/ them, if they were unbiased. They’re not. So show them the door.

    Yay California!

  2. capnfive says:

    Any word if any suits are going against the other carriers for this, as well?

  3. vr4z06gt says:

    I agree with you consumerist forced arbitration is absurd. Especially in limited competition sectors such as cell phone providers. It is almost as if racketeering has taken place. There are now four major providers, Verizon, Sprint, AT&T, and Cingular, who all force ETF’s, arbitration contracts, and horrible customer service on their subscribers knowing that consumers can only turn to one of their competitors to fulfill their addictions where they will be treated just as worthless. All the mean while knowing that one of the other three will force customers to them.

    Something needs to be done.

  4. I love California!… So many things that can lose value in other states just don’t do that here. We have some really sweet laws. I may not agree with every one, but so far I think we’re doing a good job.

  5. Nick says:

    Fantastic! I really hate arbitration clauses, and I sincerely hope that this helps open the door for getting rid of them entirely (too many companies hide behind them; no one should ever have to give up their right to sue, especially in the face of gross negligence).

  6. Crazytree says:

    the court ruled on class action suits… not sure if this invalidates the arbitration clauses ENTIRELY as the story seems to suggest… or merely applies to the consumer’s ability to join in a class action suit.

  7. justarep says:

    Well, THIS is going to make for an interesting time at work now. (I work in T-Mobile customer care.)

    Never mind that we’re not allowed to respond to legal threats in my department, anyway…

  8. bnissan97 says:

    Wish it would get to every case, not just class action ones!

  9. Thrust says:

    This is the first step towards the future I envision, where you can sue companies in YOUR jurisdiction instead of theirs, software EULA’s no longer allow companies to release half-completed or buggy/viral games because you must agree to all their terms to play, Copy protection does JUST THAT. It prevents COPYING, not PLAYING. And the RIAA is declared a criminal racketeering organization, which ends in a bloody showdown with SWAT.