Friday, June 21, 2013

The most depressing opinion in years

The beginning of Justice Kagan's dissent in AMEX v. Italian Colors Restaurant says it all:

Here is the nutshell version of the case, unfortunately obscured in the Court's decision.  The owner of a small restaurant (Italian Colors) thinks that American Express (Amex) has used its monopoly power to force merchants to accept a form contract violating the antitrust laws.  The restauranteur wants to challenge the alleged unlawful provision (imposing a tying arrangement) but the same contract's arbitration provision prevents him from doing so.  That term imposes a variety of procedural bars that would make pursuit of the antitrust claim a fool's errand.  So if the arbitration provision is enforceable, Amex has insulated itself from antitrust liability -- even if it has in fact violated the law.  The monopolist gets to use its monopoly power to insist on a contract effectively depriving its victims of all legal recourse.

And here is the nutshell version of today's opinion, admirably flaunted rather than camouflaged: Too darn bad.

1 comment:

  1. Grant Gilmore wrote a wonderful book called the Death of Contract, in which legally imposed tort duties appeared to swallow traditional concepts of contract formation. I fear we are seeing the opposite, contract granting the right to opt out of all legally imposed duties . . .