How 70,000 Arbitration Claims Cornered SiriusXM

SiriusXM advertised music plans at prices like “$5/mo for 12 months.” At checkout — or, for phone signups, only on the credit card statement — a “U.S. Music Royalty Fee” appeared, inflating the real price by 21.4%.4 The fee wasn’t a government charge and wasn’t a royalty pass-through in any regulated sense. It was, plaintiffs alleged, a profit center dressed up to look like a tax.

Hattis, Lukacs & Corrington — a small Bellevue, Washington firm that has made subscription junk fees its specialty — turned that fee into a multi-forum campaign that SiriusXM ultimately paid to make go away, while New York’s attorney general independently took apart the company’s cancellation process in court.

70,000

purported arbitration claims, by SiriusXM’s own count — Form 10-Q, Q1 FY2026

Timeline

1. 2023-06-05
   Carovillano v. Sirius XM filed in the Southern District of New York (1:23-cv-04723): advertised prices concealed the royalty fee. Press coverage of the complaint floats ~$28B in claimed exposure.3
2. 2023-06-13
   Wave 1 hits AAA: 19,577 arbitration demands (01-23-0002-6406), lead attorney Daniel Hattis — eight days after the class action.1
3. 2023-12
   NY Attorney General Letitia James sues SiriusXM over its cancel-by-agent-only subscription flow — a separate front, same pressure.6
4. 2024-02-06
   SDNY denies SiriusXM’s motion to dismiss the NY GBL §§ 349/350 claims: a generic “plus fees and taxes” disclaimer doesn’t immunize an undisclosed 21.4% fee.4 Reporting indicates phone-signup plaintiffs also defeated the company’s arbitration push.5
5. 2024-06
   Parallel class actions filed by the same counsel network: Balmores (W.D. Wash. 2:24-cv-00886)8 and Woods (San Francisco).9
6. 2024-11
   NY court rules SiriusXM’s cancellation process violated ROSCA — customers could sign up without an agent but couldn’t cancel without one.7
7. 2025-07-16
   Wave 2 hits AAA: 11,158 demands (01-25-0003-3668).1 Days earlier, Keller Postman filed 23,821 Unruh Act demands against Pandora — SiriusXM’s own subsidiary (see sidebar).2
8. 2026-01-13
   Global settlement. Resolves most remaining mass arbitration claims plus the Carovillano, Burns, Kirkpatrick, Balmores, and Woods class actions.2
9. 2026-04-01
   NY court grants the AG an injunction and accounting on the ROSCA claim.2
10. 2026-05-20
    Both AAA case numbers close on the same day — the settlement, effectuated.1

One class action survives: Stutsman v. Sirius XM Radio LLC (W.D. Wash. 2:25-cv-01113), which SiriusXM says it will fight.10

How the campaign was structured

Two forums, one theory. The SDNY class action and the first AAA wave landed eight days apart. That is not a coincidence; it is a design. Subscribers who signed up by phone had a strong argument they never agreed to arbitrate — they anchored the court track.5 Everyone else went to AAA. SiriusXM faced the same allegation on both tracks simultaneously and could not kill either one: the motion to dismiss failed in February 2024, and 19,577 AAA demands carry per-case fees a respondent pays whether or not the claims have merit.

Waves, not a flood. The second AAA filing came two years after the first — 11,158 more demands in July 2025, while settlement pressure from the first wave was presumably maturing. A second wave tells the respondent the pipeline is still open: settle globally, or the demands keep coming.

A state AG as an accidental force multiplier. The New York Attorney General’s cancellation suit was independent, but every ruling — the ROSCA decision in November 2024, the injunction in April 2026 — raised the reputational and regulatory temperature while the fee campaign was pending. A respondent settling a mass arbitration is also pricing headline risk.

The endgame. SiriusXM’s 10-Q states that over half of the ~70,000 purported claims “have been withdrawn by counsel or closed by the AAA” — the visible residue of eligibility screening and administrative attrition at scale — and that the January 2026 settlement swept in most of what remained plus five class actions.2 Both AAA case numbers closing on May 20, 2026 is the disclosure data’s way of saying the deal got done.

What it likely cost to play

Public data doesn’t show the settlement amount — SiriusXM calls it immaterial, and against $2.2B+ in quarterly revenue that phrase covers a lot of ground. But the campaign’s inputs are estimable from public fee schedules: acquiring and screening ~70,000 claimants, three years of prosecution across two AAA case numbers and four-plus federal and state courts, and the working capital to carry all of it with recovery uncertain until year three.

This campaign was won by a firm that could fund a three-year, two-front war it might have lost. That is the barrier to entry in one sentence.