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Court Rules Uber Can't Invoke Arbitration Against Customer

Since the Supreme Court upheld the validity of arbitration agreements, many would-be consumer cases have been halted. However, a federal court in New York, in a consumer class action alleging price-fixing against Uber, recently struck down defendant's attempt to invoke an arbitration clause and class action waiver against the plaintiff-consumer. The court found that Uber that did not previously argue the arbitration issue was not procedurally entitled to reconsideration. It also held that the contractual class action waiver “is most plausibly read as an explanation of the rights that the parties are giving up in agreeing to arbitrate disputes, and not as an independently effective waiver of the right to pursue a class action outside the arbitration context.” Since the defendant did not move to compel arbitration initially, it could not now block the class action. The Court also found that a separate class action waiver would be unconscionable under California’s Discover Bank v. Superior Court. Click here to read more.

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