Document ID: ./input/supremecourt_opinions/opinions/10pdf/09-893.pdf
Page Number: 9.0

6 

AT&T MOBILITY LLC v. CONCEPCION 

Opinion of the Court 

adhesion  in  a  setting  in  which  disputes  between  the
contracting parties predictably involve small amounts 
of  damages,  and  when  it  is  alleged  that  the  party 
with the superior bargaining power has carried out a
scheme  to  deliberately  cheat  large  numbers  of  con-
sumers out of individually small sums of money, then 
. . .  the  waiver  becomes  in  practice  the  exemption  of
the  party  ‘from  responsibility  for  [its]  own  fraud,  or 
willful  injury  to  the  person  or  property  of  another.’ 
Under  these  circumstances,  such  waivers  are  uncon-
scionable  under  California  law  and  should  not  be  en-
forced.”  Id.,  at  162,  113  P. 3d,  at  1110  (quoting  Cal.
Civ. Code Ann. §1668). 

California courts have frequently applied this rule to find 
arbitration agreements unconscionable.  See, e.g., Cohen v. 
DirecTV, Inc., 142 Cal. App. 4th 1442, 1451–1453, 48 Cal. 
Rptr. 3d 813, 819–821 (2006); Klussman v. Cross Country 
Bank, 134 Cal. App. 4th 1283, 1297, 36 Cal Rptr. 3d 728,
738–739 (2005); Aral v. EarthLink, Inc., 134 Cal. App. 4th
544, 556–557, 36 Cal. Rptr. 3d 229, 237–239 (2005). 

III 

A 

The  Concepcions  argue  that  the  Discover  Bank  rule, 
given its origins in California’s unconscionability doctrine
and  California’s  policy  against  exculpation,  is  a  ground
that “exist[s] at law or in equity for the revocation of any
contract” under FAA §2.  Moreover, they argue that even if 
we  construe  the  Discover  Bank  rule  as  a  prohibition  on
collective-action waivers rather than simply an application 
of  unconscionability,  the  rule  would  still  be  applicable  to
all  dispute-resolution  contracts,  since  California  prohibits
waivers  of  class  litigation  as  well.   See  America  Online, 
Inc.  v.  Superior  Ct.,  90  Cal.  App.  4th  1,  17–18,  108  Cal.
Rptr. 2d 699, 711–713 (2001). 

When  state  law  prohibits  outright  the  arbitration  of  a