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The Oklahoma Supreme Court held that retroactively applying a class action waiver to a preexisting class action lawsuit would be unconscionable because it "defie[d] reason to conclude that [the claimant] intended to halt a class action suit . . . in exchange for a free cell phone."
In Bilbrey v. Cingular Wireless, L.L.C., No. 102973, 2007 WL 1828283 (Okla. June 26, 2007), Bilbrey entered into a cellular phone contract with Southwestern Bell Mobile Systems to which Cingular became successor in interest. Bilbrey initiated a class action suit against Cingular, alleging that Cingular overcharged its customers by calculating the duration of answered calls from when the phone started ringing rather than when the other party answered the call.
Several months after filing the class action lawsuit, Bilbrey obtained a new wireless phone from Cingular by signing a new contract. The new contract contained an arbitration provision that barred class-wide proceedings.
Ten months after Bilbrey signed the new contract, Cingular moved to compel arbitration. The trial court denied the motion.
On appeal, the Oklahoma Supreme Court held that retroactive application of a class waiver to an existing lawsuit would be unconscionable because "such effect is one-sided and unreasonably favorable to Cingular." The Court declined to address the general enforceability of class action waivers, but found it unfathomable that Bilbrey would willingly relinquish an ongoing class action in exchange for a free phone.
In reaching its holding, the Court was careful to emphasize that the class action lawsuit was ongoing when Bilbrey entered the new contract, which he had done in order to replace a stolen phone. Specifically, the Court noted that "the attempt to have an actively prosecuted class action dismissed because of a subsequently signed adhesion contract with a consumer is unconscionable."
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