Class-action waiver

A term saying you may only bring a claim for yourself, never as a group.

A class-action waiver is the sentence inside an arbitration clause saying you may pursue a claim only individually. It is the reason a company can charge a million people $40 each and face no aggregated exposure.

In AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011), the Supreme Court held that the Federal Arbitration Act preempts state rules that treated such waivers as unenforceable. Courts have since developed grounds on which particular waivers still fail - unconscionability, defective assent, the specific drafting of the clause - so whether a given waiver holds is a case-by-case question and not a foregone conclusion.

Related terms

• Class action - One lawsuit brought on behalf of everyone harmed the same way.
• Class representative - The named person who stands in for the whole class.
• Class certification - The court ruling that lets one case speak for everyone.
• Arbitration clause - Contract language sending disputes to a private forum instead of court.
• Unconscionability - A contract term so one-sided a court refuses to enforce it.
• Contract of adhesion - A take-it-or-leave-it contract with no room to negotiate.
• Assent - Whether you actually agreed, and how the company proved it.
• Negative option billing - You are charged unless you act to stop it.