American Express Co. v. Italian Colors Restaurant (12-133)
argument 12-133American Express Co. v. Italian Colors Restaurant
Supreme Court of the United States
1h 1m
6 speakers
8 chapters
transcribed 6 days ago
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What is the central dispute between American Express and Italian Colors Restaurant?
This is case number 12-133, American Express versus Italian Colors Restaurant. Mr. Kellogg.
Thank you, Mr. Chief Justice. It may please the Court. The Court below thrice refused to enforce the party's arbitration agreement because he thought that class procedures were necessary to vindicate the plaintiff's Sherman Act claims. That holding was a reversible error for at least three reasons. First, it has no basis in either the FAA or the Sherman Act. Second, it creates an unworkable threshold inquiry. And third, it is unnecessary to any legitimate policy concerns raised by the Court below.
Mr. Kellogg, suppose it goes to arbitration, as you think it should, and the arbitrator says to the merchant, to prove your case — You have to show the relevant market. You have to show that American Express has market power, that use that power to the detriment of its competitors. And the way these tying cases have gone is you get an expert. And I don't see that you can prove it. In a new way, the whole point of this is that the expense to win one of these cases is enormous, and no single person — It does not force that person as well.
MR. Well, three responses to that, Your Honor. The first is that it is up to the arbitrator in the first instance to devise procedures to deal with claims in an efficient and cost-effective manner. Second, to the extent that — expert report is required that would cost a lot of money, we have conceded below that the parties could share costs of that expert just as they could share the costs of a lawyer. And third, the alternative is to have an inquiry up front that this Court has rejected in Concepcion that you cannot condition the enforcement of an arbitration agreement on the availability of class procedures.
JUSTICE SOTOMAYOR What was the — I missed that. The sharing of the costs, how does that work? It's certainly not in the agreement. It's not in the arbitration agreement that American Express is going to pay for the expert for the other side.
MR. We acknowledged below that they could share costs among multiple plaintiffs.
JUSTICE SOTOMAYOR Oh, oh. MR. Or that.
JUSTICE SOTOMAYOR Yeah. MR. The sharing of costs. Now, under the
Court Below's regime — JUSTICE SOTOMAYOR And then when you would have five, six different arbitrations going and in each of those five or six cases, you would have — they could share? that they could share the million-dollar cost of this expert?
MR.
They could share
the cost of the expert. And, of course, they get their attorney's fees back, plus reasonable statutory costs, plus potentially treble damages. as the Court below held, is that the district court has to decide in the first instance, I'm not going to send it to arbitration because I think they need a class action. To make that determination, he first has to do a Rule 23 analysis. Would there even be a class certified in this case? Only 20%. of putative classes are certified. And that's not an inquiry
that the Court should be making at the office. JUSTICE SOTOMAYOR I'm sorry, but I don't think I got the answer to my question. The arbitrator has now said we have to have an expert, and the plaintiff says The complainant says, I haven't got the wherewithal, and if I have six friends who bring individual arbitrations, that's nearly enough. So what happens then? The case ends? Well, as
we said, they would be able to share an expert between multiple plaintiffs, but there is no guarantee in the law that every claim has a procedural path to its effective indication. This Court held in Eisen, for example, even though the Court acknowledged that it was a $70 claim, it could only be brought as a class action. But the plaintiff in that case said, I can't afford to do the notice cost. And the Court said, well, then the class is decertified because the plaintiff has to put up the notice. The whole point of arbitration, of course, is that it expands the universe of claims that can be brought efficiently and effectively
for small consumers. JUSTICE GINSBERG. Mr. Keller, do you think that if in your arbitration agreement you had a clause which just said, I hereby agree not to bring any Sherman Act claim against American Express,
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Chapters
8 chapters
1
What is the central dispute between American Express and Italian Colors Restaurant?
0:00–8:12
2
How do the parties argue about the role of arbitration versus class‑action procedures?
8:12–16:13
3
Can plaintiffs share expert‑report costs in arbitration, and why does it matter?
16:13–24:20
4
What is the “effective vindication” doctrine and how does it apply to this case?
24:20–31:32
5
Do confidentiality clauses in the arbitration agreement block cost‑sharing or evidence sharing?
31:32–37:59
6
Would a pure exculpatory clause that bans antitrust claims be enforceable under the FAA?
37:59–45:15
7
How does the Court evaluate whether arbitration fees are prohibitive under Randolph and Mitsubishi?
45:15–54:23
8
What is the Supreme Court’s ultimate ruling on the class‑action waiver in this case?
54:23–1:01:37