Consumers 1, AT&T 0 after Washington State Decision

By at 2 September, 2008, 9:50 am

Anyone that has used a piece of software, signed up for a credit card or a cell phone, is well aware of the so called "license" or "service" agreements AKA End User License Agreements ("EULA") that providers impose for use of their product or service.

A piece of communality these "agreements" share is that they are usually very one-sided, with all of the benefits accruing to the service provider, while placing most, if not all, of the burdens on the consumer. Provisions dealing with choice of law and jurisdiction, mandatory and binding arbitration, attorney fees and costs only for the provider, as well as reduction in statue of limitation periods are just a few of the onerous provisions the consumer is forced to accept.This is no longer true at least in the State of Washington.

The Washington Supreme Court recently ruled in favor of a consumer and against AT&T and it service agreement. The ars technica website has the full story here. This is truly a case of David vs. Goliath, with David taking down the giant with his sling and pebble.

In reaching its decision, the Washington Supreme Court looked at a number of issues including unconscionability and Federal Preemption. This Court determined that Washington State law was not preempted in this instance. In response to arguments that allowing this case to move forward in Washington would place a burden on AT&T to deal with individual state laws, the Court opined:

AT&T seems aghast that it may have to comply with the laws of 50 different states, but that is precisely what every other company that competes in a free, competitive, and open market must do.
Imagine what a shock that must be for AT&T – to find out that they are supposed to be part of a free, competitive and open market place! One would think they were doing business in a democracy, the nerve of such an idea.
It is particularly refreshing to have a court be upfront and honest when confronting something so one sided and unequal as this AT&T Service Agreement.This Court does this when it states in its conclusion: "The AT&T Consumer Services Agreement before us is a contract of adhesion."
While not binding outside the State of Washington, hopefully, this case will serve as a starting point for other states to start reasserting consumer rights when dealing with such unfair and onerous agreements in which the consumer has no bargaining position.
Categories : Hmmm!

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