II 112th CONGRESS 1st Session S. 1652 IN THE SENATE OF THE UNITED STATES October 4, 2011 Mr. Blumenthal (for himself, Mr. Franken, and Mr. Whitehouse) introduced the following bill; which was read twice and referred to the Committee on the Judiciary A BILL To amend title 9 of the United States Code to prohibit mandatory arbitration clauses in contracts for mobile service.

1.

Short title

This Act may be cited as the Consumer Mobile Fairness Act of 2011.

2.

Findings

Congress finds the following: (1)Consumer use of mobile services has dramatically increased over the last 2 decades, with many consumers relying primarily or solely on a mobile device for voice, data, and Internet use. (2)Consumer disputes of mobile services agreements often involve small amounts in controversy. (3)Disputes involving small amounts in controversy are well-suited for class litigation, as class litigation allows a more efficient process than numerous similar individual actions, distributes the costs of litigation across a large pool of plaintiffs, and may present a stronger incentive for a defendant to cease or change harmful behavior. (4)Many contracts for mobile services contain clauses that require aggrieved consumers to waive their right to litigate as an individual or class and instead submit to binding arbitration of any future dispute. (5)Several States have found, through legislation or case law, that the clauses described in paragraph (4) are unconscionable or unenforceable when they bar class litigation. (6)On April 27, 2011, the Supreme Court, in its decision in AT&T Mobility, LLC v. Concepcion, 563 U.S. _, slip op. (2011), held that States must enforce mandatory binding arbitration clauses even if they bar class litigation. (7)The Concepcion decision restricts consumers’ ability to resolve disputes against providers of mobile services.

3.

Arbitration of mobile service disputes

(a)

In general

Title 9, United States Code, is amended by adding at the end the following: 4

Arbitration of commercial mobile service disputes

Sec. 401. Definitions. 402. Validity and enforceability.

401.

Definitions

In this chapter— (1)the term commercial mobile service has the same meaning as in section 332 of the Communications Act of 1934 (47 U.S.C. 332); (2)the term covered individual means an individual who acquires, or attempts to acquire, commercial mobile service for personal, family, or household use; (3)the term mobile broadband Internet access service means a retail service by wire or radio that provides the capability to transmit data and receive data from the Internet, including any capabilities that are incidental to and enable the operation of a communications service, that services end users primarily using mobile stations; (4)the term mobile service means commercial mobile service or mobile broadband Internet access service; and (5)the term pre-dispute arbitration agreement means any agreement to arbitrate a dispute that had not yet arisen at the time of the making of the agreement.

402.

Validity and enforceability

(a)

In general

Notwithstanding any other provision of law, a predispute arbitration agreement between a covered individual and a provider of mobile service shall not be valid or enforceable. (b)

Applicability

An issue as to whether this chapter applies to an arbitration agreement shall be determined under Federal law. The applicability of this chapter to an agreement to arbitrate shall be determined by a court, rather than an arbitrator, irrespective of whether the party resisting arbitration challenges the arbitration agreement specifically or in conjunction with other terms of the contract containing the agreement.

. (b)

Technical and conforming amendments

(1)

In general

Title 9 of the United States Code is amended— (A)in section 2, by inserting or as otherwise provided in chapter 4 before the period at the end; (B)in section 208— (i)in the section heading, by striking Chapter 1; residual application and inserting Application; and (ii)by adding at the end the following: This chapter applies to the extent that this chapter is not in conflict with chapter 4.; and (C)in section 307— (i)in the section heading, by striking Chapter 1; residual application and inserting Application; and (ii)by adding at the end the following: This chapter applies to the extent that this chapter is not in conflict with chapter 4.. (2)

Table of sections

(A)

Chapter 2

The table of sections for chapter 2 of title 9, United States Code, is amended by striking the item relating to section 208 and inserting the following: 208. Application. . (B)

Chapter 3

The table of sections for chapter 3 of title 9, United States Code, is amended by striking the item relating to section 307 and inserting the following: 307. Application. . (3)

Table of chapters

The table of chapters for title 9, United States Code, is amended by adding at the end the following: 4. Arbitration of mobile service disputes401 .

4.

Effective date

This Act, and the amendments made by this Act shall take effect on the date of enactment of this Act and shall apply with respect to any dispute or claim that arises on or after the date of enactment of this Act.