Singh v. Uber Techs., Inc.

• Citation: 571 F.Supp.3d 345
• Decision Date: 23 November 2021
• Docket Number: 16-3044 (FLW), No. 19-18371 (FLW)
• Parties: Jaswinder SINGH, on behalf of himself and all those similarly situated, Plaintiff, v. UBER TECHNOLOGIES, INC., Defendant. James Calabrese, Gregory Cabanillas, and Matthew Mechanic, individually and on behalf of all those similarly situated, Plaintiffs, v. Uber Technologies, Inc., and Rasier, LLC, Defendants.
• Court: United States District Courts. 3th Circuit. United States District Courts. 3th Circuit. District of New Jersey

571 F.Supp.3d 345

Jaswinder SINGH, on behalf of himself and all those similarly situated, Plaintiff,

v.UBER TECHNOLOGIES, INC., Defendant.

James Calabrese, Gregory Cabanillas, and Matthew Mechanic, individually and on behalf of all those similarly situated, Plaintiffs,

v.Uber Technologies, Inc., and Rasier, LLC, Defendants.

No. 16-3044 (FLW)

No. 19-18371 (FLW)

United States District Court, D. New Jersey.

Signed November 23, 2021

Joshua S. Boyette, Justin L. Swidler, Matthew D. Miller, Travis B. Martindale-Jarvis, Swartz Swidler LLC, Richard Steven Swartz, Swartz Legal LLC, Cherry Hill, NJ, Daniel Ari Horowitz, O'Brien, Belland & Bushinsky, LLC, Moorestown, NJ, for Plaintiff in 16-3044 (FLW).

Paul Calvin Lantis, William James Simmons, Littler Mendelson, P.C., Philadelphia, PA, for Defendant in 16-3044 (FLW).

Catherine E. Anderson, Giskan Solotaroff & Anderson LLP, New York, NY, Roosevelt N. Nesmith, Law Office of Roosevelt N. Nesmith, LLC, Montclair, NJ, Russell S. Warren, Jr., Englewood Cliffs, NJ, for Plaintiffs James Calabrese in 19-18371 (FLW), Gregory Cabanillas in 19-18371 (FLW), Matthew Mechanic in 19-18371 (FLW).

Paul Calvin Lantis, Littler Mendelson, P.C., Philadelphia, PA, for Defendants in 19-18371 (FLW).

WOLFSON, Chief Judge:

Jaswinder Singh, James Calabrese, Gregory Cabanillas, and Matthew Mechanic (collectively, "Plaintiffs") were drivers with the rideshare company Uber Technologies, Inc., who allege individually, and on behalf of a class of similarly situated New Jersey drivers,¹ that Uber misclassified them as independent contractors, thereby depriving them of overtime pay and other benefits afforded to employees. Uber moves to compel arbitration under the Federal Arbitration Act ("FAA") pursuant to a clause in Plaintiffs’ contracts. 9 U.S.C. § 1, et. seq. Plaintiffs argue that arbitration is inappropriate because they fall within an exemption to the FAA as transportation workers who move riders across state lines. Uber responds that Plaintiffs do not belong to such a class of workers because interstate rides constitute a small fraction of all rides, and in any event, I should order arbitration under the New Jersey Arbitration Act ("NJAA"), which embodies the same pro-arbitration policy as the FAA without the exemptions. For the following reasons, I GRANT Uber's motions, COMPEL arbitration under the FAA, and DENY Plaintiffs’ motion for class certification as moot.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

Uber is a billion-dollar technology company whose ridesharing app enables drivers to connect with riders, based on location, at the click of a button. Def. Statement of Material Facts I ("SUMF"), ¶¶ 1, 9. Plaintiffs are gig-economy workers who used the Uber app to provide rides between 2014 and 2020. They allege that Uber must reimburse certain business expenses (e.g. , the cost of maintaining cars, gas, insurance, and phone/data expenses), comply with guaranteed minimum wage laws, and pay overtime, as state law requires for employees. The present dispute centers on the validity of an arbitration provision in their contracts.

A. The Arbitration Provision

Drivers who sign up with Uber must accept the company's Technology Services Agreement ("TSA") before completing any rides. Id. ¶¶ 2, 28, 30, 41. Uber presents the TSA to drivers as soon as they login to the app by populating a "TERMS AND CONDITIONS" screen with a hyperlink. Id. ¶¶ 3-4. Clicking the hyperlink opens the TSA. Id. ¶ 5. After drivers scroll through the document for as long as they need to review it, id. ¶ 6, the app prompts them to click "YES, I AGREE." Id. ¶ 8. As this screen makes clear, "[b]y clicking below, you represent that you have reviewed all the documents above and that you agree to all the contracts above." Id. ¶ 9. Once a driver indicates agreement, the app generates another screen, which reads: "PLEASE CONFIRM THAT YOU HAVE REVIEWED ALL THE DOCUMENTS AND AGREE TO ALL THE NEW CONTRACTS." Id. ¶ 11. At this point, drivers may select buttons reading "NO" or "YES, I AGREE." Id. ¶ 12. If drivers select yes, Uber stores the executed TSA in an online portal, reviewable to this day. Id. ¶ 13. Singh joined Uber on June 21, 2014. Id. ¶¶ 16, 25. Mechanic joined on December 11, 2015. Def. SUMF II, ¶ 61. Calabrese joined on June 8, 2017. Id. ¶ 55. Cabanillas joined on August 18, 2017. Id. ¶ 56. Each driver accepted the TSA as a condition of signing up. Def. SUMF I, ¶¶ 14-15; Def. SUMF II, ¶¶ 55, 57-59, 61.

The applicable version of the TSA contains an arbitration provision visible on the first page, which provides:

IMPORTANT: PLEASE NOTE THAT TO USE THE UBER SERVICES, YOU MUST AGREE TO THE

TERMS AND CONDITIONS SET FORTH BELOW. PLEASE REVIEW THE ARBITRATION PROVISION SET FORTH BELOW CAREFULLY, AS IT WILL REQUIRE YOU TO RESOLVE DISPUTES WITH THE COMPANY ON AN INDIVIDUAL BASIS THROUGH FINAL AND BINDING ARBITRATION UNLESS YOU CHOOSE TO OPT OUT OF THE ARBITRATION PROVISION.... IF YOU DO NOT WISH TO BE SUBJECT TO ARBITRATION, YOU MAY OPT OUT OF THE ARBITRATION PROVISION BY FOLLOWING THE INSTRUCTIONS PROVIDED IN THE ARBITRATION PROVISION BELOW.

WHETHER TO AGREE TO ARBITRATION IS AN IMPORTANT BUSINESS DECISION. IT IS YOUR DECISION TO MAKE, AND YOU SHOULD NOT RELY SOLELY UPON THE INFORMATION PROVIDED IN THIS AGREEMENT AS IT IS NOT INTENDED TO CONTAIN A COMPLETE EXPLANATION OF THE CONSEQUENCES OF ARBITRATION. YOU SHOULD TAKE REASONABLE STEPS TO CONDUCT FURTHER RESEARCH AND TO CONSULT WITH OTHERS—INCLUDING BUT NOT LIMITED TO AN ATTORNEY—REGARDING THE CONSEQUENCES OF YOUR DECISION, JUST AS YOU WOULD WHEN MAKING ANY OTHER IMPORTANT BUSINESS OR LIFE DECISION.

Def. SUMF I, ¶ 18. The arbitration provision specifies the FAA as the governing law and contains a class action waiver:

This Arbitration Provision is governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq. (the "FAA") and evidences a transaction involving commerce. This Arbitration Provision applies to any dispute arising out of or related to this Agreement or termination of the Agreement and survives after the Agreement terminates ....

Except as it otherwise provides, this Arbitration Provision is intended to apply to the resolution of disputes that otherwise would be resolved in a court of law or before a forum other than arbitration. This Arbitration Provision requires all such disputes to be resolved only by an arbitrator through final and binding on an individual basis only and not by way of court or jury trial, or by way of class, collective, or representative action.

Id. ¶ 19. The arbitration provision also contains a delegation clause, which encompasses a wide range of potential disputes between drivers and Uber, including threshold questions such as whether a particular dispute is arbitrable:

Such disputes include without limitation disputes arising out of or relating to interpretation or application of this Arbitration Provision, including the enforceability, revocability or validity of the Arbitration Provision. All such matters shall be decided by an Arbitrator and not by a court or judge.

Id. ¶ 20. At the same time, the TSA offers an opt-out provision, which drivers may exercise for up to 30 days after accepting the TSA by emailing Uber. It states:

Your Right To Opt Out Of Arbitration.

Arbitration is not a mandatory condition of your contractual relationship with the Company. If you do not want to be subject to this Arbitration Provision, you may opt out of this Arbitration Provision by notifying the Company in writing of your desire to opt out of this Arbitration Provision ....

Should you not opt out of this Arbitration Provision within the 30-day period, you and the Company shall be bound by the terms of this Arbitration Provision. You have the right to consult with counsel of your choice concerning this Arbitration Provision. You understand that you will not be subject to retaliation if you exercise your right to assert claims or opt-out of coverage under this Arbitration Provision.

Id. ¶ 21. Though thousands of drivers exercised their opt-out rights, Plaintiffs did not.² Id. ¶ 23-24; Def. SUMF II, ¶¶ 56, 60, 62.

B. The FAA

While state law forms the substantive basis for most of Plaintiffs’ claims, the present arbitration dispute arises under the FAA. Congress enacted the FAA in 1925 "in response to a perception that courts were unduly hostile to arbitration." Epic Sys. Corp. v. Lewis , ––– U.S. ––––, 138 S. Ct. 1612, 1621, 200 L.Ed.2d 889 (2018). The statute provides that "agreements to arbitrate [are] ‘valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.’ " AT&T Mobility LLC v. Concepcion , 563 U.S. 333, 336, 131 S.Ct. 1740, 179 L.Ed.2d 742 (2011) (quoting 9 U.S.C. § 2 ). In this sense, the FAA places arbitration agreements on equal footing with all other contracts and requires courts to enforce them according to their terms. Epic Sys. , 138 S. Ct. at 1621 (describing "a liberal federal policy favoring arbitration agreements") (quoting Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp. , 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983) ); Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc. , 473 U.S. 614, 631, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985) (describing the policy as "emphatic"). Not only must "questions of arbitrability [ ] be addressed with a healthy regard for the federal policy favoring arbitration," but "any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration." Moses , 460 U.S. at 24-25, 103 S.Ct. 927. The FAA "establishes procedures by which federal courts implement" this "substantive rule." Rent-A-Ctr., W., Inc. v. Jackson , 561 U.S. 63, 68, 130 S.Ct. 2772, 177 L.Ed.2d 403 (2010). Specifically, § 4 permits litigants to seek a court order "directing the parties to proceed to arbitration in accordance with the terms of the agreement," while § 3 requires courts to stay litigation "until such arbitration has been had in accordance with the terms of the...