June 24, 2019

The Supreme Court’s Anti-Worker Rulings Are So Routine Now That We Hardly Notice Them. Big Mistake.

The Supreme Court’s conservative bloc delivered yet another 5–4 decision helping corporate interests this week. You may not have heard about it, as these 5–4 pro-corporate rulings are now issued like clockwork. A distinct pattern has emerged among the court’s “partisan” rulings, where the Roberts Five render a 5–4 decision attracting no support from the more liberal justices. This one comes at the expense of American workers.

This latest partisan 5–4 decision—which came in the case of Lamps Plus Inc. v. Varela—used the Federal Arbitration Act, a law governing how parties can resolve disputes through private arbitration proceedings, to deny a defrauded worker a chance at a class action. Again, if you missed it, you’re not alone. Partisan decisions from the Roberts Five choking off the rights of workers and consumers and protecting corporations from accountability have become so boringly predictable that they’re hardly news anymore.

The Federal Arbitration Act is a favored weapon of the corporate-friendly Roberts Five. In a series of these partisan 5–4 decisions, the Republicans on the Roberts court have morphed that statute into a get-out-of-accountability-free card for corporations: Rent-a-Center v. Jackson(2010), AT&T v. Concepcion (2011), American Express v. Italian Colors Restaurant (2013), and Epic Systems v. Lewis (2018), to name a few. All made it harder for workers to get their day in court. All went well beyond the original meaning of the act when passed in 1925, which was to “enable merchants of roughly equal bargaining power to enter into binding agreements to arbitrate commercial disputes,” as Justice Ruth Bader Ginsburg explained in a 2018 dissent in Epic Systems. These same arbitration cases often also display the Roberts Five’s fierce hostility—in both judicial and arbitration settings—to plaintiffs who seek to join their claims in collective or class-action cases. This hostility lets corporate malfeasance resulting in high-volume, low-dollar injuries go unremedied.

The court’s hostility lets corporate malfeasance resulting in high-volume, low-dollar injuries go unremedied.

Lamps Plus is a textbook example. The plaintiff, Frank Varela, sued his employer, Lamps Plus, after a company data breach led to a fraudulent tax return being filed in his name. Relying on the Roberts Five’s arbitration precedent, Lamps Plus lawyers drove Varela’s claims out of court and into corporate-friendly arbitration. In arbitration, Varela sought to arbitrate his claims for a class of similarly situated workers. The 9th Circuit agreed, applying the legal doctrine of contra proferentem—a long-settled principle of state contract law that ambiguities in contracts be construed against the party that drafted the contract, particularly where that party has greater bargaining power. “A reasonable—and perhaps the most reasonable—interpretation of [the agreement’s] expansive language is that it authorizes class arbitration,” the 9th Circuit majority said.

Then the Roberts Five went to work. Notwithstanding these state contract law principles (remember federalism?) or the absence of any textual support in the arbitration statute (remember textualism?), the 5–4 Roberts majority held that to construe ambiguities against the drafter of an arbitration agreement (almost always a corporate drafter) would contravene what it called the Arbitration Act’s “first principle”—that “arbitration is strictly a matter of consent, not coercion.” As a matter of fact, this employer had drafted the arbitration agreement (ambiguities and all) and had forced Varela to sign it as a condition of his employment. Some consent. (The Roberts Five have a tendency to invent facts in cases to suit their desired outcome—Citizens United and Shelby County being notable examples.)

Justice Ruth Bader Ginsburg in dissent pointed out how “treacherously” the court has strayed from the principle that arbitration is a matter of consent: “Shut from the Court’s sight is the ‘Hobson’s choice’ employees face: ‘accept arbitration on their employer’s terms or give up their jobs.’ ” Once again, the corporate interest won, 5–4.

There is an established pattern of bias toward the corporate elite, inconsistent with Roberts’ famous assertion from his confirmation hearing that the justices are just “calling balls and strikes.” In partnership with the American Constitution Society, I just published a review of Chief Justice John Roberts’ tenure through 2018 describing this pattern. Republican appointees have delivered for corporate or conservative interests in 73 partisan, 5–4 decisions during the Roberts era, with big Republican donor interests winning 73 out of 73 decisions. More tellingly, the Roberts Five often trample purportedly conservative judicial principles—respect for states’ rights, textualism, judicial restraint, stare decisis, even originalism—when those principles stand in the way of an outcome they want. In nearly 55 percent of those 73 decisions, one or more of those traditionally conservative judicial principles was ignored.

Driving consumers and employees into forced arbitration takes away their constitutional right to a jury trial and spares mighty corporate defendants the embarrassment of testifying under oath, divulging corporate documents through discovery, or being treated equally with an injured person. Closing off class actions—the only economically feasible path to litigate high-volume, low-dollar fraud—creates a safe harbor for this form of corporate misbehavior. Many of the 73 Roberts Five decisions serve to protect corporations from these consequences.

Equality before the law is a fundamental tenet of our democracy. Courts and juries have a constitutional role in checking the power of wealthy elites who can push ordinary people around, and who are often not checked by legislatures and executive officials. While the chief justice has recently been inclined toward grand public gestures defending his court’s impartiality, the unmistakable pattern of partisan 5–4 decision leads to an inescapable conclusion: that the Roberts Five are pursuing political outcomes, and are willing to violate basic principles of American governance to execute the right-wing, corporate Republican game plan.

Lamps Plus is another case in point. 

By: Sheldon Whitehouse