During the last few years meaningful consumer remedies, e.g., the class action device, have come under vigorous assault, particularly, in the realm of the purchase of moderately priced goods and services. One need only read Justice Ruth Bader Ginsburg’s dissent in Direct, Inc. v. Imburgia,1 The New York Times article cited therein [see "In Arbitration, a 'Privatization of the Justice System'"2 ("By inserting individual arbitration clauses into a soaring number of consumer and employment contracts, companies [have] devised a way to circumvent the courts and bar people from joining together in class-action lawsuits, realistically the only tool citizens have to fight illegal or deceitful business practices”)3 and the Arbitration Study4 published by the federal Consumer Financial Protection Board5 to understand that meaningful consumer remedies have nearly been extinguished6 through forced arbitration, particularly on the Internet.7

A Brief History

A brief history8 of the U.S. Supreme Court’s views on the enforceability of mandatory arbitration clauses and class action and class arbitration waivers in consumer contracts follows. In Green Tree Financial Corp. v. Bassel9 the court held that whether an arbitration agreement prohibits class arbitrations is to be decided by arbitrators and not the courts. Subsequently, the court, in Stolt-Nielsen v. AnimalFeeds International Corp.,10 clarified its earlier ruling in Bazzle by reversing the U.S. Court of Appeals for the Second Circuit decision finding the class wide arbitration was permissible. “It follows that a party may not be compelled under the FAA to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so.”

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