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San Diego Court Must Disband AT&T Class

(CN) - The 9th Circuit on Monday sent a class action against AT&T Mobility back to a California District Court in the wake of a U.S. Supreme Court finding that federal arbitration law trumps the state's ban on unconscionable contracts.

Vincent and Liza Concepcion brought a class action against AT&T Mobility for allegedly fraudulent taxes on their cellphone contract.

A San Diego federal judge held that AT&T's arbitration clause blocking class actions was unconscionable and so unenforceable. The 9th Circuit affirmed, but that decision was soon overturned by the high court.

A five-justice majority ruled in April that AT&T could block the class action by enforcing the arbitration clause because the Federal Arbitration Act pre-empts California's law on unconscionable contracts.

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