Apple, AT&T Won’t Back Down From Arbitration

     (CN) – IPhone customers who have been ordered to arbitrate claims over restricted carrier choices should not be able to appeal, AT&T and Apple argued in new briefs Tuesday.



     Lead plaintiffs Paul Holman and Lucy Rivello filed a federal complaint against Apple and AT&T Mobility (ATTM) in October 2007, claiming the companies illegally controlled consumer choices by limiting iPhone users to AT&T plans.
     Though Chief U.S. District Judge James Ware in San Jose initially certified the class action, the U.S. Supreme Court upended a similar case involving AT&T’s arbitration contracts, Concepcion v. AT&T Corp.
     Heeding that decision, Ware disbanded class suing Apple and AT&T and said the companies could compel arbitration.
     “The Supreme Court has specifically considered the very arbitration agreement at issue in this case, and has determined that it is enforceable, on the grounds that the agreement ‘essentially guarantee[d]’ that ‘aggrieved customers who filed claims’ would ‘be made whole,'” Ware wrote (brackets in original).
     Apple can also compel the plaintiffs to arbitrate their claims, even though the company did not sign the arbitration agreement, according to the ruling.
     Based on 9th Circuit precedent, Apple can compel arbitration under the doctrine of estoppel, because the subject matter of the dispute is intertwined with the contract, and there is a sufficient relationship between the parties, Ware found.
     After the plaintiffs moved for reconsideration or certification of an appeal, Apple and A&T filed separate motions in opposition on Tuesday.
     AT&T attorney Donald Falk, with Palo Alto, Calif-based Mayer Brown, said the “perverse theory” that an appeal is needed to review the court’s findings is “based on a profound misunderstanding of waiver law.”
     “Courts throughout this circuit – including this court – overwhelmingly have concluded that it would have been futile for companies whose agreements required arbitration on an individual basis to move to compel arbitration before Concepcion in light of existing circuit precedent,” Falk wrote, citing the Supreme Court decision that said arbitration agreements deserve “equal footing with other contracts.”
     Apple attorney Daniel Wall made similar arguments in his opposition brief, saying the plaintiffs’ appeal is “nothing more of a rehash of the same arguments.”
     “There is not a single thing new in plaintiffs’ motion, and the core argument for reconsideration is simply that the Court’s written Order did not expressly address one of plaintiffs’ many arguments,” said Wall, an attorney with San Francisco-based Latham & Watkins.
     Wall also said that the court need not respond to claims that the terms of service of Apple’s iTunes Store prevents the court from applying equitable estoppel.
     The plaintiffs’ motion “does not come close to meeting the stringent demands for either reconsideration or interlocutory appeal,” Wall wrote.

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