Ninth Circuit rejects First Amendment petition clause challenge to arbitration agreement, saying that private party’s conduct is not attributable to the state (for purposes of the “state action” doctrine)

Take a look at the Ninth Circuit's decision today in Roberts v. AT&T MobilityHere's the court's description of the dispute:

Plaintiffs—AT&T customers and putative class representatives—contracted with AT&T for wireless data service plans. Their contracts included arbitration agreements. Plaintiffs allege AT&T falsely advertised that its mobile service customers could use “unlimited data,” but actually “throttled”—intentionally slowed down—customers’ data speeds once reaching “secret data usage caps” between two and five gigabytes. Plaintiffs claim a phone’s key functions, such as streaming video or browsing webpages, are useless at “throttled” speeds.

Plaintiffs filed a putative class action, alleging statutory and common law consumer protection and false advertising claims under California and Alabama law. AT&T moved to compel arbitration in light of the Supreme Court’s ruling in AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011),“that the FAA preempts state law deeming AT&T’s arbitration provision to be unconscionable.” Plaintiffs opposed the motion on First Amendment grounds. They argued that an order forcing arbitration would violate the Petition Clause, as they “did not knowingly and voluntarily give up their right to have a court adjudicate their claims… .” 

The Ninth Circuit nixed the argument without getting to the merits, holding that

There is no state action here. First, AT&T’s conduct must be fairly attributable to the state, and Denver Area [Educational Telecommunications Consortium, Inc. v. FCC, 518 U.S. 727 (1996)] did not hold otherwise. Second, AT&T is not a state actor under the “encouragement” test. The FAA merely gives AT&T the private choice to arbitrate, and does not “encourage” arbitration such that AT&T’s conduct is attributable to the state. 

Leave a Reply

Your email address will not be published. Required fields are marked *