osewalrus (osewalrus) wrote,

Will The internet Help Replace Class Actions? AT&T v.Spacarelli

This interesting piece in GigaOm about Matt Spacarrelli and his small claims action against AT&T for throttling his "unlimited" iPhone plan without telling him prompts an interesting line of thought about the use of social media and small claims to replace class action suits.

As some folks may recall, AT&T has a clause in in its wireless contract that requires users to waive their right to class action. Last year, the Supreme Court said that was perfectly legal (although I would note that the FCC could prohibit it under Section 201(b) as an unjust and unreasonable practice, at least with regard to the voice plan). The reason we developed class action law suits was to permit aggregation of a large number of identical claims and to overcome the transaction cost of individuals with worthy cases suing.

Spacarrelli is attempting to reduce the transaction costs for individual plaintiffs by informing them about the case and helping them learn how to file in small claims court (at least in CA). It may be that the Internet will sufficiently reduce the transaction cost for a sufficient number of small claims plaintiffs to impact AT&T behavior. Should be interesting.

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