OTLA Trial Lawyer Fall 2021

39 Trial Lawyer • Fall 2021 See Cooking with Force p 40 explain how they sold this entry-level program — and the lifetime debt load — to people who had experience in the trade. Nor could they explain their ubiq- uitous ads where chefs talked about their exciting careers as chefs. Our experts and witnesses explained a few things in their testimony. First, entry level jobs in the culinary field do not require a college education. At most, they require the ability to do basic arith- metic. But the most important require- ments are physical: heat and noise toler- ance and the ability to work under time pressure. Second, this phenomenon was a recurring problem in consumer fraud. Trade school financial fraud has been ongoing since the government began funding such programs after World War II. In the post-World War II funding rush, scam schools often focused on television repair or upholstery. Third, the degree was mostly worthless, especially to those who had experience in the trade. We were careful to contrast this program with other culinary programs and good trade school programs because there are programs that have value and are worth- while. Mandatory forced arbitration Many challenging things happened during the long life of the case. Among them, the U.S. Supreme Court decided a landmark case, AT&T v. Concepcion . 2 The case, which fully legitimized fine- print contractual bans on jury trials and class actions, appeared to permanently end consumer protection and wage theft class action practice. That was by design. While corporate interests touted arbitrations as “faster, cheaper and more efficient,” what they really meant was most claims would evaporate because no one can afford to sue on a small claim. Here’s how AT&T v. Concepcion af- fected our case. During the life of the case, Career Education Corp. used two different versions of an enrollment agree- ment. The earlier version did not ban class actions. The latter did, and that was the form that was tested in Gozzi . In ef- fect, the forced arbitration clause split the class in two. There were two groups of students who signed different enroll- ment agreements. Roughly half the class signed the earlier agreement that did not have an enforceable arbitration clause. That group continued forward as part of a class that had been certified by the trial court. The second group, that signed the later enrollment agreement, was taken out of the class by Gozzi . The second group — roughly half of the total origi- nal class — fell out of the class. The Court of Appeals held class members who signed the later agreement were required to arbitrate their claims. 3 The morass Forced arbitration successfully takes out most claims. But most is not all. And as we learned in this litigation, it is pos- sible to take corporate hubris and group think and fashion it into a beautiful Trojan horse. Following remand in Gozzi , the par- ties went to mediation. The class counsel proposed a global settlement that would include both groups of students. Career Education Corp. refused to settle with individuals who were required to proceed via individual arbitration. Apparently, Career Education Corp. believed very few people would proceed to individual arbitration.Their unexamined premise— that no one would pursue arbitration— proved to be an expensive error. The defendant’s posture at the initial mediation meant a thousand people victimized by their misconduct risked being left out. The case had started with outrage, but at this point, the outrage turned to cold fury. While we had no way of knowing for certain, we had good reason to think we could attract a mass of arbitrations. First, we knew the class, as we had a class list