Judge Rejects Arbitration for DirecTV Class Action

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Decision eliminates big obstacle in class action over early cancellations.

LOS ANGELES – A state court judge on Thursday denied attempts by broadcast satellite provider DirecTV Inc. to compel arbitration in a class action that alleges consumers were illegally charged up to $480 in early cancellation fees.

Superior Court Judge John Shepard Wiley Jr.'s ruling removes a key hurdle to the class action, brought on behalf of more than 570,000 California-based DirecTV customers alleged to be unlawfully charged between 2004 and 2010, according to Consumer Watchdog, a consumer advocacy group that is among the plaintiffs' class counsel.

"Today's ruling means that customers will have the opportunity to team up and take on this huge company in a public court of justice," said Pamela M. Pressley, Consumer Watchdog's litigation director, who represents the class.

Robyn E. Bladow of Kirkland Ellis LLP, who represents DirecTV, said in a statement that her client was "disappointed" that Wiley "decided to ignore the United States Supreme Court's clear directives" in consumer class actions.

"We look forward to the appeal," Bladow said.
DirecTV allegedly took millions of dollars directly from its customers' credit card and bank accounts. The lawsuit seeks to return the money to the subscribers and force DirecTV to change its cancellation fee system. Imburgia v. DirecTV Inc., BC398295 (L.A. Super. Ct., filed Sept. 17, 2008).

The company's service contract with its customers contains an arbitration clause, and the agreement in question contained a class-action waiver, according to Wiley's ruling.

DirecTV moved to compel arbitration after last year's U.S. Supreme Court decision AT&T Mobility LLC v. Concepcion, which held that the Federal Arbitration Art pre-empts state laws that ban contracts from prohibiting class actions.

Wiley ruled that the law that applied to the DirecTV case was Brown v. Ralphs, a 2nd District Court of Appeal decision from last July that held that Concepcion did not address whether the Federal Arbitration Act pre-empts California residents' right to sue to enforce state laws under the Private Attorney General Act.

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