By Anthony M. Christina and Patricia Zapata Latzer
For decades, corporations have used a clever legal tool to insulate themselves from accountability: the mandatory arbitration clause. Buried in the fine print of nearly every consumer agreement, from credit card agreements to employment contracts, mobile app terms of service, and consumer product warranties, these clauses stripped ordinary consumers of their right to sue in court and, critically, their ability to band together in class actions. What corporations did not anticipate was that consumers and their advocates would devise creative ways to fight back using the very same clause as a weapon. That fight is called mass arbitration, and it is reshaping the landscape of consumer protection law.
The Rise of Mandatory Arbitration
The Federal Arbitration Act (“FAA”), passed in 1925, was originally designed to allow businesses to resolve commercial disputes quickly and privately, outside of court. And, for most of the 20th Century, it played a modest role in the legal system.
That changed in the 1980s and 1990s, when the Supreme Court issued a series of rulings that dramatically expanded the FAA’s reach. In cases like Southland Corp. v. Keating (1984) and AT&T Mobility LLC v. Concepcion (2011), the Court held that the FAA preempts state laws that might otherwise protect consumers from unfair arbitration clauses and that companies could lawfully ban class actions through arbitration agreements.
By the mid-2010s, mandatory arbitration clauses with class action waivers had become standard boilerplate language in virtually every consumer contract in America. The result was a legal dead zone. Corporations could engage in widespread misconduct affecting millions of people, knowing that the likelihood of any liability, which would require millions of individuals to file small claims in arbitration, was practically zero.
Consumers Find a Way: The Birth of Mass Arbitration
In response to these dramatic changes, consumer advocates reasoned that, if companies want to force consumers into individual arbitration, then consumers can demand individual arbitration en masse.
The strategy, pioneered in the mid-2010s and refined over the following decade, works like this: rather than filing a single class action lawsuit, plaintiffs’ firms recruit thousands of individual consumers who have been harmed by the same corporate misconduct. Each one files a separate, individual arbitration demand in specialized venues often with the American Arbitration Association (“AAA”) or Judicial Arbitration and Mediation Services (“JAMS”)—that the company itself selected as the venue in its own arbitration agreement.
The results were remarkable. Companies suddenly found themselves facing not one lawsuit, but tens of thousands of individual arbitration demands, each requiring separate case management, separate arbitrators, and separate filing fees that the company was often contractually obligated to pay.
For example, when Uber faced tens of thousands of individual arbitration demands in 2020, the company owed tens of millions of dollars in filing fees alone. DoorDash, which had aggressively pushed arbitration clauses on its delivery workers, faced a similar avalanche and a federal court ruling in Abernathy v. DoorDash (N.D. Cal. 2020) that it had to pay or face default.
Companies that had weaponized arbitration to escape accountability suddenly found themselves negotiating settlements because the alternative was financial and administrative ruin.
How Mass Arbitration Has Benefited Consumers
The emergence of mass arbitration as a litigation strategy has produced concrete, meaningful benefits for everyday consumers and workers, in these three significant ways.
1. Restoring Bargaining Power
For years, the arbitration clause was a one-sided weapon. Mass arbitration has rebalanced the equation and leveled the playing field for claimants to be able to leverage their individual claims with the collective weight of a group. When companies know that deceptive practices could trigger thousands of simultaneous arbitration demands, they face a genuine financial deterrent.
2. Producing Real Settlements
Mass arbitration campaigns have resulted in substantial monetary recoveries for consumers who would otherwise have received nothing. Workers misclassified by gig economy companies, consumers deceived by subscription services, and borrowers subjected to unlawful lending practices have all obtained compensation through this mechanism. In many cases, settlements have included systemic reforms and changes to corporate practices.
3. Incentivizing Companies to Abandon Arbitration Clauses
Perhaps the most significant long-term benefit: mass arbitration has prompted some companies to voluntarily remove or limit mandatory arbitration clauses from their consumer contracts. What was once seen as a shield against liability has become a potential liability in itself. In fact, in 2021, Amazon temporarily removed the mandatory arbitration provision and class action waiver from its consumer online terms of service after facing hundreds of thousands of arbitration demands from customers claiming its Alexa service was recording them without their consent.
The Legal Landscape Today
Mass arbitration is not without its critics or challenges. Some courts have grappled with questions about whether coordinated mass filings constitute a form of procedural abuse, and some arbitration administrators have adopted new rules designed to manage, and in some cases slow mass filings. Companies have also fought back by revising the arbitration clauses in their terms of service to make it harder (and in some instances nearly impossible) for consumers to practically pursue any form of relief, including adding “batching” provisions that require claims to proceed in small groups that delay relief, bellwether procedures, and fee-shifting mechanisms designed to blunt the financial pressure of mass demands.
The Companies were the ones who wrote the arbitration clauses that pushed consumers out of court in the first place, on the promise that it would be more accessible than litigation. But now that consumers have taken them up on that promise at scale, those same companies are redrafting the rules to ensure claimants are blocked from access to justice.
This area of law continues to evolve rapidly. Arbitration administrators like the AAA have updated their mass-filing rules in response to the volume of cases. After the temporary policy reversal in 2021, Amazon reinstated its arbitration clause in its consumer agreements, in August 2026, which represents the ever-changing legal landscape of arbitration. Courts across the country are working through questions about arbitration agreement enforceability, fee obligations, and the procedural rights of claimants in mass proceedings.
What This Means for You
If you believe you have been harmed by a company’s deceptive, unfair, or unlawful conduct, whether as a consumer, an employee, or an independent contractor, the existence of an arbitration clause in your terms does not necessarily mean you are without recourse. Mass arbitration has opened new pathways to justice that simply did not exist a decade ago.
An experienced attorney at the law firm of Lowey Dannenberg, P.C. can evaluate your claims, assess the arbitration agreement at issue, and advise you on whether participation in a coordinated mass arbitration effort is appropriate for your situation. Please view our pending actions on Claim Magic, which empowers clients to sign up, monitor, and engage with attorneys seamlessly.
Disclaimer: Data breaches cases listed on Claim Magic and select other actions are not being investigated by Lowey as mass arbitrations. If you have any questions on which actions are mass arbitrations, contact support@claimmagic.com.
About the Authors
Patricia Zapata Latzer is Of Counsel and Co-Lead of the Mass Arbitration Practice Group at Lowey Dannenberg, P.C. She represents consumers in complex mass arbitration matters against major corporations.
Anthony M. Christina is a Senior Associate at Lowey Dannenberg, P.C., and a member of the firm’s Mass Arbitration Practice Group. He has extensive experience in data privacy, data breach, and consumer protection litigation.
The information in this blog post is provided for general informational purposes only and does not constitute legal advice. No attorney-client relationship is formed by reading this post. If you have questions about your specific legal situation, please contact our office to schedule a consultation.
