Compliance » Appeals Court Shunts An Uber Class Action Into Arbitration

Appeals Court Shunts An Uber Class Action Into Arbitration

September 8, 2016


The Ninth Circuit Court of Appeals, reversing U.S. District Court Judge Edward Chen, has ruled that drivers challenging Uber’s background check practices need to enter individual arbitrations and can’t pursue their case as a class action. This decision is considered a major victory for the company, and as the Los Angeles Times puts it, “a stinging decision” for the drivers. The Ninth Circuit’s decision came in the case of Mohamed v. Uber Technologies, but the precedent is likely to call into question the class action status of other actions by Uber drivers, including a larger and widely reported case involving drivers in California and Massachusetts who are challenging their classification as contract workers. A tentative $100 million settlement that had been negotiated in that matter was recently rejected as inadequate by Judge Chen, but it’s now looking as if the plaintiffs, most of whom accepted the optional arbitration clause when they signed up with Uber, are likely to come out worse than they would have under that settlement once their individual cases get arbitrated.

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