Lerach Coughlin Stoia Geller Rudman & Robbins LLP Announces Court Denies Petition to Compel Arbitration; Trial on ``Deceptive''
10 Juin 2005 - 11:50PM
Business Wire
A Los Angeles court has ruled that AT&T Wireless Welcome Guide,
the brochure contained in mobile telephone boxes provided to
customers after the purchase of wireless service, which contains an
arbitration clause, is not a part of the contract with consumers.
Defendant AT&T Wireless brought a petition to compel
arbitration of the claims of named plaintiffs, arguing that their
allegations of false advertising should not be heard in Los Angeles
Superior Court but should be sent to a private arbitrator. In
denying defendant AT&T Wireless's motion to compel arbitration,
a judge of the Los Angeles Superior Court's complex department held
that AT&T Wireless customers could not be bound by the terms of
a document that was provided after the customer purchased his or
her phone. Citing long-standing California precedent, the Court
ruled that a consumer cannot be bound by proposed contract terms
located in a document that they had no reason to know was
contractual in nature. Because AT&T Wireless's Welcome Guide
discusses the features of mobile phones, such as voicemail, long
before disclosing to customers that they are waiving important
legal rights, the document could not be considered a part of a
consumer's contract with AT&T Wireless. "This represents an
important victory for all consumers in refusing to allow a business
to impose terms on a consumer without allowing the consumer a
meaningful chance to object," said Reed R. Kathrein, the Lerach
Coughlin partner who leads the case against AT&T Wireless. "In
ruling that AT&T Wireless cannot force consumers to waive their
right to litigate in court by hiding an arbitration clause in a
box, the Court has vindicated the rights of all consumers."
Defendants brought the petition to compel consumers to arbitration
on the eve of trial, arguing that the Court no longer had
jurisdiction over plaintiffs' claims. The trial on whether the
coverage maps of AT&T Wireless (now Cingular) are deceptive
will now go forward. Lerach Coughlin Stoia Geller Rudman &
Robbins LLP filed the class action suit in Superior Court for Los
Angeles County against LA Cellular, AT&T Wireless, and
BellSouth Cellular on behalf of customers who are victims of the
cell phone companies' deceptive practices in 1998. The case alleges
false and misleading advertising based on the wireless companies'
promises of seamless wireless coverage throughout the four-county
Los Angeles region. Each of the four named plaintiffs allege they
were misled by defendants' promises that they would receive
wireless coverage in areas near their homes, places of employment,
and other well-traveled areas. AT&T Wireless was recently
acquired by Cingular Wireless, creating one of the nation's largest
wireless carriers. Both defendants joined in the petition to compel
the plaintiffs' claims to arbitration. Cingular is a joint venture
between the domestic wireless divisions of SBC (NYSE:SBC) and
BellSouth (NYSE:BLS). SBC owns 60 percent of the company and
BellSouth owns 40 percent, based on the value of the assets both
contributed to the venture. AT&T Wireless is wholly owned by
Cingular. Press and Consumer Contact Information: If you are press
or a resident in the Los Angeles region who has been deceived by
AT&T Wireless or Cingular's coverage maps and/or advertising or
are otherwise interested in speaking to an attorney regarding this
case, please contact Reed Kathrein at Lerach Coughlin Stoia Geller
Rudman & Robbins LLP at 415-288-4545 or visit our website at
www.lerachlaw.com or email coveragemaps@lerachlaw.com.
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