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State Supreme Court says arbitration clause should not prevent suit's class-action status

Georgia's Supreme Court overturned a ruling that had favoreda SunTrust Banks Inc.arbitration clause over a plaintiff's motion to get class-action status, the Atlanta Business Chronicle reported July8.

In 2010, Jeff Bickerstaff claimed SunTrust's overdraft feesviolated state usury laws and then later pushed for class-action status.Bickerstaff has since died, and his mother continues the lawsuit on his behalf.A lower court sided with defense lawyers, who argued a customer could notrepresent others, under the terms of the bank contract. But the Supreme Courtdecided that, with at least 1,000 likely plaintiffs and the unfeasibility ofindividual filings, the case should be returned to the appeals court.

Mandatory arbitration clauses in contracts have come underregulatory scrutinyfor causing consumers' cases to be tossed. The CFPB has proposed prohibitingtheir application to class-action cases — a move that banks argue will benefitno one but triallawyers.