We recently posted comments by Arbitrator and NAA Member, Barry Winograd, on the arbitration angle of the recent multi million dollar settlement involving the ride-provider service Lyft. Arbitrator Winograd noted that: the Lyft settlement provided “prospective relief in arbitration for disputes that subsequently arise, including objections to the company’s termination of drivers.”
In what might become a trend, The Recorder, reports that a U.S. Magistrate Judge has approved a settlement agreement on a lawsuit filed against Uber Technologies which also provides that the plaintiff will pursue her claim in arbitration.
The lawsuit, which was filed in January 2016, involved a putative class action alleging that Uber had breached the terms of a “Winter Warmup” promotion under which Uber agreed to pay drivers some guaranteed minimum rates if certain conditions were met. The plaintiff sought to represent a class of drivers who had participated in the promotion.
Under the reported settlement agreement the plaintiff agreed to arbitrate her claim individually, as well as agreeing to stay a separate Private Attorneys General Act claim.
Interestingly, and as noted by Arbitrator Winograd, in the Lyft settlement, plaintiff’s counsel acknowledged that “the settlement amount was reduced substantially, and the conversion of drivers to employees was dropped as a demand, because its challenge to Lyft’s arbitration agreement and class action waiver was unsuccessful”. It is unclear what motivated the plaintiff in this case to settle. Perhaps plaintiffs are using the leverage of the lawsuit to secure a more favorable arbitration process, before agreeing to pursue their claims through arbitration.
A different Uber class action is set for trial in San Francisco in June of 2016.