In a recent legal development which interests many of our readers, a Rhode Island federal district court decided not to enforce a stand-alone class action waiver in a consumer’s automobile lease agreement, calling it a violation of the state public policy. The case in question was Metcalfe v. Grieco Hyundai LLC.
The case saw legal scrutiny on the grounds that the stand-alone class action waiver contravened Section 6-13.1-5.2 of Rhode Island’s Deceptive Trade Practices Act (DTPA), which stipulates that consumers “may … bring an action on behalf of themselves and other similarly injured and situated persons.” The court’s ruling rejects prior interpretations that permitted such waivers in commercial or consumer contracts.
This legal decision may reshape contract drafting and negotiations, especially in automobile leasing services, where stand-alone class action waivers are a commonly used mechanism. It also has potential implications for lawyers and corporate legal personnel in understanding the legal limits of contract terms in relation to state-specific public policies.
Legal professionals across the country will be watching closely for further developments from this case and how this ruling might influence future court decisions, especially those related to class action waivers and deception in contractual language.
Further information can be obtained in the legal briefing provided by Ballard Spahr LLP, available here.