A federal appeals court has upheld the constitutionality of the Federal Arbitration Act in a case that raised “novel and difficult questions of first impression” over when, if ever, private companies could be considered acting for the state.
The case, which attracted amicus briefs from Public Justice, the U.S. Chamber of Commerce, and the Retail Litigation Center, involved four plaintiffs who brought a class action alleging false advertising over AT&T’s “unlimited” service plans. The suit claimed AT&T intentionally slowed data once their usage reached between two and five gigabytes. AT&T moved to compel arbitration, which plaintiffs opposed by alleging that the FAA violated the First Amendment rights of its customers to petition the government.
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