A Review: The Scotus Papers in Live Nation v. Heckman
By Bryan Ward
The U.S. Supreme Court is on the verge of hearing its first mass arbitration case.
The Court’s Sept. 29 conference, just ahead of the new 2025-2026 term, could produce a Washington, D.C., trip for a California case that has had major implications for mass arbitration and the Federal Arbitration Act’s primacy over state law.
Live Nation Entertainment, Inc. v. Heckman, No. 24-1145, a case addressed extensively here on CPR Speaks, is one of three arbitration cases the Court will consider hearing in the new term at the conference. [See our CPR Speaks coverage at “Hot Topic: Mass Arbitration--Heckman v. Live Nation” (Nov. 11, 2024) (available at https://bit.ly/3K5y0uy) (linking to an extensive YouTube discussion of the appeals court case); Russ Bleemer, “Live Nation-Ticketmaster’s Online Mass Arbitration Program Is Tossed by the Ninth Circuit” (Oct. 30, 2024) (available at https://bit.ly/4n8CoaS), and Jayden Solomon, “Ninth Circuit Hears Live Nation-Ticketmaster Appeal on Its Rejected Mass Arbitration” (June 18, 2024) (available at https://bit.ly/4pwXrFN).
In Live Nation, the Ninth U.S Circuit Court of Appeals--in a unanimous decision written by Senior Circuit Judge William A. Fletcher--found Live Nation’s mass arbitration program for customers of its Ticketmaster unit, implemented under the rules of Chicago-based web provider New Era ADR, to be procedurally and substantively unconscionable. Heckman v. Live Nation Entertainment Inc., 120 F.4th 670 (9th Cir. 2024) (available at https://bit.ly/4pqH6SG).
The Ninth Circuit declined to sever the offending provisions and held that FAA preemption did not override California state law. Circuit Judge Lawrence VanDyke noted in his concurrence that the program did not reflect traditional bilateral arbitration envisioned by Congress, a point focused on by amicus filings.
The decision rejecting Live Nation’s New Era ADR arbitration system contrasts with some mass arbitration precedent--see, e.g., Wallrich v. Samsung Elecs. Am. Inc., 106 F.4th 609 (7th Cir. 2024) (available at https://bit.ly/4eFElrd), suggesting that properly structured mass arbitration programs are generally enforceable.
Among the Ninth Circuit’s critiques of New Era ADR’s rules is that the plaintiff’s input in the selection of the arbitrator is undermined by New Era’s sole discretion to replace the arbitrator. Additionally, the Ninth Circuit noted fundamental notice due process issues under Hansberry v. Lee, 311 U.S. 32, 40–43 (1940) (available at https://bit.ly/3VmQyZL), as New Era ADR’s rules bound claimants to early, bellwether arbitrator decisions even in cases where they may have neither participated nor even known about the proceedings.
At the Supreme Court, Live Nation argues that the Ninth Circuit’s interpretation of what can be arbitration is based on an idea of bilateral arbitration but insists that there is no historical basis for the claim that arbitration’s definition excludes class arbitration and New Era ADR’s bellwether procedures. The brief says that class arbitration qualifies as arbitration under the FAA and must fall under its provisions.
Live Nation argues that this case is an appropriate vehicle for the Court to clarify both (1) what kinds of arbitration are protected under the FAA, and (2) whether California’s severability standard is preempted due to its adverse impact on arbitration.
In his brief, Petitioner Skot Heckman, on behalf of fellow respondents, contends that there is no circuit split as Live Nation claims regarding the processes in the case needing and deserving FAA protection. It says that the processes aren't arbitration. In arguing against the Court granting cert, the petition states, “Clearly the FAA’s protection of contracts to ‘arbitrate’ would not cover private agreements to resolve disputes through a ‘winner-take-all game of ping-pong,’ [petition citation omitted] even if that ludicrous provision was contained in a contract titled ‘Arbitration Agreement.’”
At this writing, there are four friend-of-the-Court briefs filed supporting Beverly Hills, Calif.-heaquartered Live Nation in asking the Court to take the case:
Atlantic Legal Foundation
Established in 1977, the Atlantic Legal Foundation is a national, nonprofit, free market-oriented public-interest law firm that advocates for individual liberty, property rights, limited government, sound science in judicial and regulatory proceedings, and school choice. The Washington, D.C.-based firm is a frequent amicus participant in arbitration cases at the nation’s top Court. It contributed the amicus brief in line with its interests in preserving freedom to contract and applying “sound principles of law to the enforcement of arbitration agreements.”
The ALF argues that the Live Nation/Ticketmaster arbitration agreements should be enforced according to their terms and expresses concerns about potential abuse by the plaintiff’s bar--specifically, the use of mass filings to force settlements. “The analysis and conclusions in Heckman invite improper challenges to sensible measures for mass arbitrations, in contravention of long-standing Supreme Court precedent,” the brief states.
New Era ADR
New Era ADR is an online dispute resolution platform that provided the mass arbitration system Live Nation used. The ADR provider defended its rules in the amicus filing, noting that they had been “clarified and refined” to address due process concerns, including in response the federal district court in the case.
The firm argues that the rules contain due process features such as notice, an opportunity to be heard, and impartial neutrals, while still adapting procedures in the name of efficiency.
Specifically, it argues that its arbitration innovations are necessary to enable parties to have disputes heard.
The brief rejects the Ninth Circuit’s interpretation of its rules and argues they are in fact designed to have claims “actually considered on their merits.” It blasts the idea that parties can be bound by precedent, stating, “Critically, each non-bellwether party has an opportunity to raise new legal arguments as to why the precedent is wrong or otherwise should not apply to their individual case.”
Ticketmaster switched to Chicago-based New Era ADR in July 2021 in the wake of bad publicity over ticket fees and suits over its allegedly monopolistic practices in conjunction with its parent’s venue ownership and promotion businesses. But last month, Ticketmaster notified customers that it was moving back to its previous provider, Irvine, Calif.-based JAMS Inc., the nation's largest private ADR firm, and ending its use of New Era ADR in its mandatory dispute resolution provisions for ticket buyers.
DRI Center For Law And Public Policy
The DRI Center for Law and Public Policy is the public policy arm of the DRI, a 65-year-old, Chicago-based defense bar association. The DRI is another regular amicus participant in arbitration cases from the business community’s perspective.
The DRI Center for Law and Public Policy argues in favor of “the FAA primacy over modern arbitration procedures,” not just bilateral arbitration.
The brief argues, “The court’s rejection of all arbitration procedures involving any type of arbitration other than bilateral arbitration undermines the fairness and efficiency that the arbitration process was always designed to create.”
The brief rejects the Ninth Circuit’s characterization of Congress when forming the FAA in 1925. Specifically, the DRI Center criticizes the idea that bilateral arbitration was solely what Congress had in mind when drafting the FAA, thereby excluding today’s mass arbitration. The brief argues that aggregate and representative litigation at that time already had existed for more than a century, noting that “[t]he meaning of the term is as broad and open as it was a century ago.”
California Employment Law Council
The California Employment Law Council is a Los Angeles nonprofit group of companies and law firms that promotes employers’ interests and advocates on workplace law in California. The brief notes that many of its members have arbitration agreements with some or all of their employees.
Similar to the Atlantic Legal Foundation, the Council expressed concerns about the use of mass filings to coerce settlements and rejected the idea that the FAA is limited exclusively to bilateral arbitration. “[T]he Ninth Circuit holding that the FAA does not apply to arbitrations other than the traditional bilateral arbitrations,” states the council’s brief urging the Supreme Court grant certiorari, “is in direct contravention of the terms of the statute and the scope of its coverage as interpreted by this Court and threatens countless employers with attempted blackmail via mass arbitration demands.”
The brief also argues that the Ninth Circuit’s rejection of the severability provisions in the arbitration rules treats the ADR process unfairly compared to other types of contracts, in violation of the FAA.
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Additional information, including key case documents and the amicus briefs, can be found on the Supreme Court’s Live Nation docket page, here.
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Live Nation is not alone: Two other Supreme Court cert petitions on arbitration matters will be considered at the Sept. 29 conference, Mungo Homes LLC v. Huskins, No. 24-1092, and Flower Foods v. Brock, 24-935. Details coming soon on CPR Speaks.
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The author, a second-year student at Brooklyn Law School in New York, is a 2025 CPR Fall intern.
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