In Nov. 2017, two women filed a lawsuit against Uber after they were sexually assaulted by Uber drivers. The lawsuit was certified as a class action because hundreds of women across the U.S. have allegedly been raped by Uber drivers. The women are suing Uber because the company allegedly has inadequate background screening systems in place for its drivers. Uber filed a motion with the court in February requesting that the court compel arbitration in the case. The plaintiffs filed an amendment to the complaint on March 15 in which seven women were added as plaintiffs. The women and their attorneys are fighting the motion to compel arbitration and want to keep the case in federal court.
Arbitration clauses in contracts
Many companies include mandatory arbitration clauses in their contracts. These clauses mean that people are unable to pursue lawsuits against the companies when disputes arise. Instead, they are forced to resolve their issues through arbitration. Arbitration proceedings are confidential, which means that companies that go to arbitration may shield damaging information from the public. When decisions are reached in arbitration, they are generally not appealable. In some cases, however, arbitration is not beneficial to plaintiffs and may harm them.
Why forced arbitration may be harmful to plaintiffs
Arbitrators often have ongoing relationships with companies. Different companies tend to use the same arbitrators to resolve their disputes. Because of this potential repeat business for the arbitrators, they may be more inclined to side with the companies that retain their services. Arbitrators are also more likely to be older, white men and may be less sympathetic to cases involving alleged discrimination and sexual harassment.
The plaintiffs in the class action are arguing that forced arbitration would prevent the survivors of sexual violence from talking about what happened to them. They are arguing that Uber’s attempt to force them into arbitration is clearly for the purpose of shielding the company and silencing the women so that the company will not be exposed. They also argue that forcing the women into arbitration would likewise force all others who might have similar claims in the future to go through arbitration, greatly harming their ability to protect their rights.
Uber argues that arbitration is appropriate for the women’s claims. It argues that arbitration is better for the women than litigation through the court process. Uber argues that the women are free to talk about what happened to them and would be able to keep control of their privacy. The women argue that Uber’s response does not make sense, and as people who already control their own privacy, they want to pursue their claims in federal court.
When forced arbitration clauses may be set aside
Federal courts and the U.S. Supreme Court, unfortunately, have been trending towards upholding arbitration agreements in general. However, in California, the state courts still scrutinize these agreements prior to enforcement. In Armendariz v. Foundation Health Psychcare Services Inc., 24 Cal. 4th 83 (2000), the California Supreme Court held that mandatory arbitration clauses may be unenforceable when they are unconscionable in terms of both procedure and substance. The case outlined the legal standards for what constitutes procedural and substantive unconscionability. To overcome an arbitration clause, both types of unconscionability must exist.
Courts look at whether or not the contract at issue is a contract of adhesion. An adhesive contract is one in which there is unequal bargaining power between the contracting parties. In this case, Uber is a large corporation and clearly has more power than the individual women who agreed to the user agreement in order to use Uber’s ride-share service. Arbitration clauses must also be bilateral in nature. In other words, the companies must also be compelled into arbitration when they want to sue the contracting parties. Uber’s arbitration clause does not mention whether Uber is likewise subject to arbitration in the event that it wants to sue, making the clause appear to be unilateral rather than bilateral. Under the Supreme Court’s decision in Armendariz, it appears that Uber’s arbitration clause may be unenforceable because of its procedural and substantive unconscionability in terms of unequal bargaining power and one-sidedness. If the court rules in favor of the women, the arbitration clause may be set aside, allowing the women to proceed with their class-action lawsuit in court.
Contact Steven M. Sweat, Personal Injury Lawyers, APC
If you have been sexually assaulted by an Uber or Lyft driver, you should speak to an experienced lawyer in Los Angeles. While the user agreements for these services contain arbitration clauses, they might be deemed to be unenforceable and set aside so that you can proceed with your case through the litigation process instead of in arbitration. Contact Steven M. Sweat, Personal Injury Lawyers, APC to schedule your consultation so that you can learn about the rights that you might have in your case. Call us today for a free, confidential consultation with a lawyer experienced in the prosecution of civil claims for sexual assault and battery in California: 866-966-5240.