The U.S. Supreme Court will soon hear arguments in a case that asks: How far can businesses go in asking their customers to sign agreements prohibiting them from joining in class actions?

In American Express vs. Italian Colors Restaurant, lawyers want to bring a class action accusing AmEx of violating antitrust laws by requiring merchants to accept AmEx debit and credit cards at the same fee level. But each of the merchants signed an agreement to settle their claims in arbitration and waived their right to join in class actions.

Alan S. Kaplinsky, a Ballard Spahr partner who pioneered the use of arbitration clauses banning class actions, filed a brief on behalf of the American Bankers Association in the case. “There were ways the plaintiffs could have made it cost-effective,” said Mr. Kaplinsky, leader of the firm’s Consumer Financial Services Group. “They elected not to go down that road.”

Related Practices

Consumer Financial Services