Just a month before oral arguments in an appeal that will test the legality of a corporate strategy to combat mass arbitration, a new ruling from a federal trial judge has highlighted the strategy’s potential due process pitfalls.
to compel claimants to arbitrate their claims under the company’s bellwether process for mass arbitration, he specifically cited the protocol’s opt-out clause, which allowed plaintiffs to litigate in court if they didn’t like any settlement proposed after the bellwether cases.
Wu, in the Live Nation case, was particularly concerned that the company’s arbitration forum, New Era, wasn’t clear about the extent to which decisions in bellwether cases would bind arbitrators in subsequent cases. He also noted that Live Nation, unlike DoorDash in the 2020 case, didn’t allow opt outs, which added to his concern that the company's bellwether process “poses a serious risk of being fundamentally unfair to claimants.
A spokesperson for the U.S. Chamber’s Institute for Legal Reform said no one from the group was available to comment.
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