Second Circuit Refuses To "Waive" Good-Bye To Class Actions

Reports that franchisors could avoid class actions through arbitration appear to have been greatly exaggerated. Despite the United States Supreme Court's AT&T Mobility v. Concepcion decision upholding class action waivers, the Second Circuit last week again distinguished Concepcion to hold that such waivers are unenforceable where class actions are "the only economically feasible means for plaintiffs [to enforce] their statutory rights." While the case, In re American Express Merchants' Litigation, No. 06-1871, 2012 U.S. App. LEXIS 1871 (2d Cir. Feb. 1, 2012), did not involve claims by franchisees, it is the latest example of the Second Circuit's narrow interpretation of the Supreme Court's recent arbitration decisions and may well provide fuel for class actions by franchisees.