SAN FRANCISCO—A three-judge panel at the 9US Circuit Court of Appeals appeared to lean in favor of Uber in a case that could have a profound impact on the future of employment and gig economy startups.

On Wednesday, the court heard a consolidated appeal of 11 pending cases that essentially boil down to the same issue: should drivers be considered employees? If so, can they sue as part of a class-action lawsuit? If Uber prevails, drivers will be considered contractors—and they won’t, as is currently the case, receive numerous benefits.

When prospective drivers sign up with Uber, they agree to waive their right to sue in favor of arbitration, a private, quasi-legal process that generally favors corporations over individuals.

More than a year ago, in a related case, the same panel of judges ruled in favor of Uber. In that case, Mohamed v. Uber, the 9th Circuit concluded that because the labor agreement pushing workers toward arbitration included an opt-out provision, the deal was OK.

Shannon Liss-Riordan, a Boston-based attorney who has brought several similar cases against Uber and other startups over this key labor question, argued Wednesday that the provision that the drivers signed forcing them into arbitration is unenforceable. Most of the members of the class in the class-action suit signed such provisions. Uber, on the other hand, argued that arbitration is the proper vehicle to settle disputes, that the plaintiffs shouldn’t be considered a “class,” and that its drivers aren’t employees.

"What we have is thousands [in a] wildly disparate group of people," Theodore Boutrous, the attorney representing Uber, said during the Wednesday hearing.

He urged the 9Circuit to decertify the 240,000 member class of drivers in O’Connor v. Uber , the lead case among this grouping of 11 related cases. O’Connor, which was almost settled in 2016, has been underway since 2013. If the 9Circuit rules in Uber’s favor, it would significantly hinder the efforts of drivers suing the company, as they would lack the heft that a class-action brings.

Liss-Riordan and Boutrous are also facing off in Lawson v. Grubhub, a separate civil trial underway in San Francisco that deals with similar employment issues. That single-plaintiff trial, currently on a break, is scheduled to resume on October 30.

Of all of the labor-related cases in the industry, O’Connor is furthest along. Others have either settled or have not yet progressed far enough. If Liss-Riordan is successful, it could have a massive ripple effect on many Silicon Valley startups that rely on relatively inexpensive labor.

Since this case began, Uber has countered with Boutrous (who represented Apple in its 2016 battle against the Department of Justice over an iPhone unlocking issue) and his colleagues at Gibson Dunn, one of the largest corporate law firms in America. His presence shows just how seriously Uber is taking this issue.

Boutrous is also the same attorney who successfully argued an important labor case before the Supreme Court in 2011 (Wal-Mart v. Dukes), which also revolved around class-action certification. In that case, the country’s highest court found in a 5-4 decision that a class-action lawsuit brought by a California Wal-Mart employee who claimed that she had been mistreated had not been properly certified.

During Wednesday’s 9th Circuit hearing, Boutrous argued that existing differences in the precise circumstances of Uber drivers—who are free to seek other income through competing apps—make it such that they can’t possibly be considered a unified class.

“The District Court went through herculean efforts to say those differences didn’t matter,” he told the appellate judges.

For her part, Liss-Riordan argued that her cases presented “significant issues” that had never been previously considered.

In court filings, she pointed to a 2016 decision made by the Georgia Supreme Court (Bickerstaff v. SunTrust Bank) in which a lead plaintiff who rejected arbitration and then ended up representing a class was considered to have done so on behalf of all class members. But the Georgia Supreme Court is not binding on a federal appellate court, and the 9th Circuit panel seemed skeptical during the hearing in San Francisco.

“The argument is more than a little novel,” Circuit Judge Richard Clifton told Liss-Riordan.

Complicating matters further is the fact that the Supreme Court is set next month to hear oral arguments in Ernst & Young v. Morris, yet another case involving arbitration in labor contracts. The 9th Circuit, when it heard the case in 2016, found that Ernst & Young’s employment contract, which required arbitration instead of allowing employees to sue in case of a dispute, violated the National Labor Relations Act.

Uber, for its part, argues that this federal law is immaterial, as it only applies to employees, and the company doesn’t consider drivers to be employees anyway.