Two recent federal appellate decisions demonstrate the limits of
last year's Supreme Court decision in AT&T Mobility LLC
v. Concepcion, 131 S.Ct. 1740 (2011). In Concepcion,
plaintiffs alleged a class of California customers to challenge the
wireless carrier's practice of charging sales tax on phones
promoted as "free" under various service agreements. When
AT&T asserted the arbitration and class waiver provisions in
its subscriber agreements, the Southern District of California
ruled that the arbitration provision was unconscionable because it
contained a class action waiver, and was therefore unenforceable
under the rule announced by the California Supreme Court in
Discover Bank v. Superior Court, 36 Cal.4th 148, 113 P.3d
1100 (Cal. 2005). The Ninth Circuit affirmed on those same grounds.
The Discover Bank Rule claimed support in § 2 of the
Federal Arbitration Act, (9 U.S.C. §2) (FAA) providing certain
exceptions to enforcement of arbitration agreements,
