Archive | April, 2011

Case of the Day: AT&T Mobility LLC v. Conception

The Case of the Day, AT&T  Mobility LLC v. Conception (S.Ct. 2011), is a significant domestic arbitration case that is outside the official Letters Blogatory scope of coverage, but I’m going to cover it anyway, because I really don’t understand the rationale of the case.

The Conceptions were AT&T Mobility customers. Their contract with AT&T had an arbitration clause. Although AT&T’s advertisement had claimed that customers like the Conceptions would receive “free phones,” the Conceptions were unhappy to learn that they were being charged sales tax on the value of the phone they received. They sued AT&T for false advertising and fraud in the Southern District of California, and their case was later consolidated with a class action making those claims. AT&T moved to compel arbitration. The District Court denied the motion on the grounds that under California law, the arbitration agreement was unconscionable because it did not permit arbitration on a class basis. The Ninth Circuit affirmed, noting that the analysis of an arbitration agreement that forbade class arbitration was the same as the analysis of a contract that bars class actions outside of the arbitration context.

Section 2 of the FAA makes arbitration agreements “valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” The Court (Justice Scalia wrote the majority opinion, which was joined by the Chief Justice and Justices Kennedy, Thomas, and Alito) didn’t focus on the plain meaning of this provision—indeed, Justice Breyer, in dissent, argued that the Court had conceded that California’s law on unconscionability came within the plain meaning of the savings clause—but instead, asserted that the purpose of the FAA was “to ensure the enforcement of arbitration agreements according to their terms so as to facilitate streamlined proceedings.” According to the Court, class arbitration “sacrifices the principal advantage of arbitration—its informality—and makes the process slower, more costly, and more likely to generate procedural morass than final judgment.”

This analysis seems really to be on the wrong track. It seems to suggest that parties cannot make an enforceable contract to arbitrate on a class basis even if they affirmatively want class arbitration. But that seems perverse and inconsistent with the notion of arbitration as a method for the parties to make their own law and resolve their own disputes as they choose.

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Digest for April 28, 2011

Domanus v. Lewicki (N.D. Ill. 2011). The plaintiff served process on several Polish firms by serving an officer in the U.S., where the Polish firms had stated, in an interrogatory resposne, that the officer was “second vice president,” and where the plaintiff had offered additional evidence necessary to make a prima facie showing that he had de facto control of the entities. The court rejected a motion to dismisss for insufficient service of process on the grounds that in light of the prima facie showing, service on the officer was proper under Rule 4(h).

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Case of the Day: United States v. Goodyke

The Case of the Day, United States v. Goodyke (8th Cir. 2011), involves the misuse of an apostille. Goodyke and Robinson held unusual views about the government. They sold fraudulent “diplomatic immunity cards” to like-minded people, telling the buyers that the cards would allow them “to avoid paying taxes, and would entitle them to immunity from being detained or arrested by law enforcement officers.” According to Goodyke’s brief, the evidence regarding the purpose of the scheme was as follows:

The undercover officer, Det. Rod Gentry of the KCMO Police Department, adopted the name of Marty Riggs for the operation, and proceeded over the early months of 2006 to have numerous meetings and telephone conversations with both Mr. Denham [another defendant] and Mr. Robinson. On February 11, 2007, Gentry attended a meeting of some 10-14 people at a karate school in Independence, Missouri, at which Mr. Robinson was the speaker. The meeting was in the nature of an “educational class” in which Robinson expounded “his views of the Constitution and so forth.”

Among the topics discussed was the process by which, as Robinson and Denham believed, an individual could reclaim  his sovereignty. This process involved three basic steps, including (1) executing and notarizing an “act of state,” this being a document that set forth an individual’s personal declaration of sovereignty and of citizenship in the Kingdom of Heaven, (2) obtaining an apostille for the act of state document from the local Secretary of State’s office, and (3) obtaining a diplomatic identification card and badge.

Let’s just pause to consider how ridiculous this is. But it seems that Robinson, at least, really believed in it (at least according to Goodyke’s brief):

On September 20, 2007, federal and local officers initiated a prearranged traffic stop of Mr. Robinson’s vehicle, during which Mr. Robinson presented officers with his own diplomatic identification card and credentials. A search of his vehicle revealed another identification card in the name of Larry Terry Smith. Both Robinson’s card and Smith’s card also contained the State Department seal.

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