Mass Arbitration and the FAA: SCOTUS Petition Targets Heckman Decision
The intersection of consumer protection, mass arbitration, and federal preemption continues to generate complex and high-stakes litigation—and the recent petition for certiorari in Heckman v. Live Nation Entertainment Inc. is a prime example. The case has attracted national attention not just because of the parties involved—concertgoers challenging entertainment giant Live Nation—but because of its potential to redefine how arbitration agreements function in the context of mass claims.
In October 2024, the U.S. Court of Appeals for the Ninth Circuit issued a major ruling in Heckman, holding that arbitration agreements formed through the Ticketmaster website were invalid due to procedural and substantive unconscionability. This decision, which also questioned the preemptive scope of the Federal Arbitration Act (FAA), sent ripples through both the arbitration and consumer law communities. Now, with Live Nation’s May 2025 petition for Supreme Court review, the legal community is watching closely to see whether the Court will revisit its longstanding support for arbitration in a new procedural setting: mass arbitration.
The Heckman Decision: A Challenge to Mass Arbitration Mechanics
At the heart of the dispute is the use of mandatory arbitration clauses in consumer agreements. In Heckman, customers purchasing tickets through Ticketmaster were bound by arbitration agreements that selected New Era ADR as the provider. The Ninth Circuit found those agreements invalid, citing both procedural and substantive unconscionability. The ruling specifically took issue with New Era ADR’s then-existing mass arbitration rules, which the court concluded created an imbalance that favored the business—Live Nation—over the consumers.
Although New Era ADR has since significantly revised its procedures to address fairness concerns, the court’s ruling hinged on the version of the rules that were operative at the time. According to the court, those rules limited discovery, created unfair cost structures, and otherwise inhibited meaningful access to justice for individual consumers—factors that tipped the scale toward a finding of unconscionability.
From a legal standpoint, the court’s approach echoed a traditional consumer protection framework. Yet in doing so, it opened the door to an aggressive form of scrutiny that could be extended to other arbitration providers and contractual frameworks, especially those designed to manage large volumes of claims efficiently through mass arbitration.
FAA Preemption and the Ghost of Discover Bank
Perhaps even more consequential than the procedural fairness critique was the Ninth Circuit’s interpretation of federal preemption. The court revived elements of Discover Bank v. Superior Court, a landmark California case that had deemed class action waivers in consumer contracts generally unconscionable. Although the U.S. Supreme Court later held in AT&T Mobility LLC v. Concepcion that the Discover Bank rule was preempted by the FAA because it interfered with the enforcement of arbitration agreements, Heckman suggested that this preemption might not extend to mass arbitration provisions.
The Ninth Circuit’s reasoning effectively created a potential pathway to challenge mass arbitration agreements under state unconscionability doctrines—something that could, if upheld, unravel many large-scale arbitration programs built by corporate defendants to avoid class actions.
This aspect of the ruling places Heckman in direct tension with Concepcion, raising the possibility of a circuit split and virtually ensuring that the Supreme Court would be asked to intervene.
Live Nation’s Petition to the Supreme Court
On May 5, 2025, Live Nation filed its Petition for Writ of Certiorari with the U.S. Supreme Court. The company presented two core questions for review:
Whether the FAA protects arbitration agreements that include procedures specifically designed for mass arbitration.
Whether California’s severability doctrine is preempted by the FAA when it results in the wholesale invalidation of arbitration agreements.
The second question is particularly nuanced. Live Nation argues that the Ninth Circuit erred in refusing to sever the allegedly unconscionable portions of the arbitration agreement—specifically, the rules of the chosen provider—and instead invalidated the agreement in its entirety. According to Live Nation, this approach is out of step with how courts treat non-arbitration contracts under similar severability doctrines. The company supported this point with statistical evidence suggesting that California courts invalidate arbitration contracts at a significantly higher rate than other types of agreements, raising concerns about discriminatory treatment under the guise of neutral contract law principles.
What’s at Stake
The implications of Heckman—and the pending certiorari petition—are far-reaching. Should the Supreme Court grant review and ultimately side with Live Nation, it could significantly bolster the enforceability of arbitration agreements that incorporate mass arbitration procedures. Such a ruling would extend the FAA’s protective reach and insulate these types of provisions from the kinds of unconscionability challenges that have become more common in consumer litigation.
On the other hand, if the Court denies review or upholds the Ninth Circuit’s ruling, mass arbitration clauses could face increased vulnerability, especially in jurisdictions that take a more skeptical view of mandatory arbitration. Businesses that rely on streamlined dispute resolution processes for large customer bases would be forced to revisit their arbitration frameworks—and potentially return to more traditional class action litigation models that many have sought to avoid.
For consumers, a decision affirming the Heckman ruling might be seen as a step toward leveling the playing field. Critics of mass arbitration provisions argue that they often mask structural disadvantages for individuals, despite appearing to offer a more efficient path to resolution. Supporters of arbitration, however, contend that such agreements are crucial for managing caseloads and controlling litigation costs, particularly when courts are already overburdened.
The Broader Context: Mass Arbitration on the Rise
Mass arbitration is a relatively new phenomenon in the legal landscape, but it’s quickly becoming a battleground issue. Whereas class actions group many claims into a single proceeding, mass arbitration floods companies with thousands of individual filings—each with its own procedural rights and costs. Plaintiffs’ counsel have increasingly embraced this tactic as a way to compel early settlements or expose the practical burdens of mandatory arbitration on corporate defendants.
Businesses, in turn, have sought to include provisions in their agreements that mitigate those burdens, often by selecting arbitration providers with specialized mass arbitration rules. The Heckman case raises critical questions about whether and how those efforts can be reconciled with long-standing contract law principles and the FAA’s pro-arbitration mandate.
Conference Date and What Comes Next
The Supreme Court has scheduled Live Nation’s petition for conference on September 29, 2025. If the Court grants certiorari, it will be signaling an intent to clarify the permissible boundaries of arbitration procedure in the mass claim context. If it declines, the Heckman ruling will stand as persuasive—if not binding—authority for courts scrutinizing arbitration agreements under unconscionability doctrines.
Either way, this case will likely shape how companies structure arbitration provisions, how courts assess fairness in those provisions, and how consumers access remedies in an increasingly complex dispute resolution environment.
Unlocking Solutions for Demanding Cases
As arbitration evolves, so do the legal and procedural challenges associated with it. The outcome of Heckman may redefine the way arbitration clauses are enforced, particularly in high-volume or high-stakes consumer settings. For parties navigating this shifting landscape—whether businesses drafting enforceable agreements or claimants asserting statutory rights—working with an experienced, balanced, and resolution-driven neutral is essential.
Nationwide ADR offers seasoned arbitration and mediation services grounded in deep understanding of both federal arbitration law and emerging trends like mass arbitration. From business disputes to statutory claims and innovative dispute formats, Nationwide ADR is committed to Unlocking Solutions for Demanding Cases.
To learn more or to inquire about services, visit NationwideADR.com.