The Premise That Turned Out to Be Contingent

Start with the proposition that organised aggregate procedure exists to solve: some claims are worth less than the cost of bringing them. A consumer overcharged forty dollars has a real legal claim and no rational way to pursue it. Counsel will not take it. The claimant will not pay for it. It goes unadjudicated, and the conduct that produced it goes uncorrected.

This is the negative-value claim, and for most of the last century the answer was procedural: create a device that aggregates the claims so that the collective value justifies the collective cost. Rule 23 is that device. So, in a different register, is the MDL.

The arbitration cases accepted the premise and drew a conclusion from it that shaped two decades of practice: individual arbitration is an adequate substitute forum, and the fact that individual proceedings make small claims economically irrational to pursue does not, without more, deny anyone the vindication of their rights.

What mass arbitration demonstrated

The premise turned out to be contingent on institutional design rather than intrinsic to small claims.

Mass arbitration achieved aggregation with no procedural aggregation device whatsoever. Every demand is formally individual. Every demand has its own claimant, its own filing, its own fee, its own arbitrator. No rule consolidates them and no tribunal certifies anything.

What aggregates them is two facts about the environment. One firm holds all of them, so the marginal cost of the ten-thousandth demand is close to zero once the intake infrastructure exists. And the forum charges administrative fees per demand, disproportionately to the respondent, so the respondent's marginal cost of the ten-thousandth demand is emphatically not zero.

The result is that a portfolio of individually uneconomic claims became collectively economic — not because the claims got bigger, but because the cost structure of the forum inverted.

That is a genuine revision to litigation theory, and it is the observation that gives the scholarly literature on mass arbitration its lasting significance beyond the doctrinal fights.

The response, read as an economic programme

Once the mechanism is stated this way, everything that has happened since becomes legible as a coordinated attempt to restore the constraint.

Flattening the initiation fee. Replacing per-case initiation charges with a flat fee severs the link between claim count and up-front cost. If the respondent's cost no longer scales with the size of the inventory, the inventory stops being leverage.

Eliminating case management fees. The dominant per-case cost component, removed. Same logic, larger effect.

Vetting and affirmation. Raising the claimant-side marginal cost. If each demand requires verification, documentation, and counsel's attestation, the near-zero marginal cost of the ten-thousandth claimant is no longer near zero.

Evidentiary preconditions. The contractual version of the same move, pushed further upstream.

Batching and sequencing. Attacking the time dimension. If the portfolio takes fifteen years to clear, its present value collapses, and a funder's internal rate of return collapses with it.

Each of these is usually discussed as a procedural reform or a drafting technique. Each is more precisely an attempt to move one variable in a cost equation.

Which ones worked

The record is mixed, and instructively so.

The fee reforms worked, in the sense that they materially changed the arithmetic: reported exposure for ten thousand demands fell from over fifteen million dollars to roughly six million. They did not restore the pre-2020 position, because six million dollars is still a number that produces settlement pressure.

The vetting requirements worked, and are the least contested. They raise claimant-side costs by requiring the diligence that ought to be done anyway, and no court has objected to a requirement that claims be real.

The time-dimension techniques have largely failed. Batching and binding bellwether structures attack present value by extending duration — and extending duration is precisely what courts have identified as functional denial. Achey, Heckman, and Rios each struck down a mechanism whose economic function was to make the portfolio worth less by making it slower. The doctrine has proved unwilling to let delay do that work.

Where the equilibrium is settling

Something like a stable position is now visible.

Mass arbitration remains viable, at reduced intensity. Front-end exposure is meaningfully lower than in 2021. Claimant-side costs are meaningfully higher. Gatekeeping neutrals screen inventories that would previously have gone unexamined. And the techniques that sought to defeat portfolios by stretching them across decades have been foreclosed.

That is not a resolution, and both sides retain live arguments. But it is a recognisable equilibrium — and it was reached almost entirely through fee schedules and procedural preconditions rather than through legislation or any restatement of arbitration doctrine. The fight over whether small claims can be adjudicated at all is being conducted, quietly, in fee tables.