In American Express Co. v. Italian Colors Restaurant (2013), a 5-3 majority of the U.S. Supreme Court held that the Federal Arbitration Act (FAA) requires courts to “rigorously enforce” arbitration agreements containing class-action waivers, even where doing so would make proving an individual federal-law claim prohibitively expensive. The court’s pro-bilateral arbitration decision is not only the latest in a line of cases in which it has rejected consumers’ efforts to engage in class-action arbitration, but may also signify the end of the road for parties seeking judicial relief in this area.

In upholding the class waiver at issue, the court relied upon other recent pro-arbitration precedent, including AT&T Mobility v. Concepcion, (2011). There, a 5-4 majority of the court determined that the FAA pre-empted a California rule, which had previously been applied to invalidate class-action waivers in consumer arbitration agreements as “unconscionable.” That decision made clear the court’s distaste for class-action arbitration, with the majority concluding that arbitration is “poorly suited to the higher stakes of class litigation.” Even though AT&T Mobility concerned federal pre-emption of a state statute, the decision figured prominently in Italian Colors, which pitted two federal statutory schemes against each other.

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