It was a mixed bag on the litigation front for Uber and Lyft last week following a string of decisions in class action lawsuits against these companies.
On Tuesday, April 5, the Ninth Circuit granted Uber’s petition to appeal an order granting class certification of approximately 240,000 Uber driver’s in California. The primary issue in that lawsuit, filed in the U.S. District Court for the Northern District of California, is whether drivers for Uber should be classified as independent contractors or employees. The Ninth Circuit’s decision will give Uber another chance to argue against class certification before the case can go to trial, which is currently scheduled for later this year.
A few days later, on Thursday, April 7, Judge Vince Chhabria of the Northern District of California rejected a proposed $12.5 million settlement in a class action lawsuit against Lyft that would preserve Lyft drivers’ status as independent contractors, while also providing them with certain protections. In rejecting the proposed settlement, Judge Chhabria indicated that he would not require Lyft to reclassify the drivers as part of the settlement, but that the proposed dollar amount, which was calculated based on driving data from 2012 to June 2015, was too low in light of more recent data showing the number of miles traveled by Lyft drivers had since nearly doubled.
Finally, also on Thursday, Uber reached a settlement in a class action lawsuit filed against Uber by the San Francisco and Los Angeles District Attorneys in which they alleged that Uber misrepresented the efficacy of background checks conducted on drivers, as well as the nature of the “safe rides fee” charged to passengers. The suit was brought after taxi interests in the two cities claimed that the fingerprint-based background checks they are required to undertake are more effective than the checks used by Uber, which utilize a combination of identifiers, including social security numbers, prior addresses, and other indicia to ferret out prior convictions. Uber agreed to pay up to $25 million to approximately 25 million customers across the county and to rebrand its “safe ride fee” as a “booking fee.” (see, http://da.lacounty.gov/media/news/los-angeles-san-francisco-county-district-attorneys-reach-25-million-settlement-with-uber) Lyft had previously faced a similar suit by the SF and LA DAs, which it resolved by agreeing to pay a $500,000 fine. See http://recode.net/2014/12/09/uber-sued-by-l-a-and-s-f-while-lyft-settles-for-500000/