Up Front: LEGAL-UNEASE
AMEX AND THE SEARCH FOR JURISPLASTIC
American Express has long boasted about its prestigious clientele. Among some 34 million cardholders, though, are a lot of federal judges. And that fact has bogged down a class action brought on behalf of AmEx customers that seeks heavy-duty fee refunds. Over the past 18 months, at least five jurists in Manhattan's U.S. District Court have disqualified themselves from hearing it. Finally, a judge emerged, albeit an American Express cardholder. Judge Michael Mukasey had to agree to waive his own rights to potential recoveries, plus those of his wife and two children. A judicial ethics committee advisory even suggested that any card-carrying aunts, uncles, siblings, nieces, and nephews drop their rights, too.
Plaintiffs' attorneys charge that AmEx violated the Truth in Lending Act because it didn't tell customers its annual fee was negotiable if they complained or threatened to drop their card. AmEx contends that it never negotiates fees.
Judge Mukasey dismissed the suit in December, but an appeal was filed on Jan. 6. So the judge jam continues--and intensifies. A three-judge panel must be found for the appeal. Plaintiffs' lawyer Bruce Coleman insists pressing the suit is worth the hassle, saying: "This is a very important issue." Tell it to the judge.EDITED BY LARRY LIGHT AND JULIE TILSNER Linda Himelstein