Judge Slams Uber's "Bad Contract" In Safe Rides Fee Row

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Law360, San Francisco (October 31, 2017, 9:12 PM EDT) -- A California federal judge appeared open

Tuesday to granting a quick win to a putative class of Uber drivers who claim the ride-hailing company

breached its contracts with drivers by deducting “safe rides” fees from driver fares, saying Uber drafted “a

bad contract” that doesn’t define certain essential terms.

U.S. District Judge Yvonne Gonzalez Rogers told Uber its contract with drivers does not define “minimum

fare” or “total fare,” and Uber hasn’t provided definitions or case law to support the company’s interpretation

of the contract. She added that “bad” contracts like these are why litigators continue to have jobs.

“The reality is it’s not the best drafted contract,” the judge said.

The judge’s comment came during a hearing in Oakland on cross summary judgment motions and the drivers'

motion for class certification in a suit alleging Uber broke their contract. The May 2016 complaint accuses

Uber of pushing the expense of its “safe rides” program — a marketing campaign to assure riders that Uber

drivers are properly vetted through background checks — onto the drivers themselves, in violation of driver

contracts with Uber.

Since the suit was filed, Judge Rogers found in December that drivers who signed arbitration agreements

must arbitrate their claims against the company, but she kept in tact claims brought by approximately 9,700

drivers who opted out of arbitration when they started working for Uber.

During the hearing Tuesday, Judge Rogers repeatedly criticized Uber's attorneys for trying to cite extraneous

evidence to support their arguments that the contract allows Uber to deduct safe ride fees from the 80 percent

share that Uber drivers earn from a trip. She also said both parties failed to “step back” and look at the

contract in an objective way and present evidence to support their positions.

Uber's attorney William L. Stern of Morrison & Foerster LLP argued that the contract makes it clear the fees

are deducted from the 80 percent share drivers earn per ride. But the judge didn’t agree.

“I understand your argument, and I don’t buy it, Mr. Stern,” she said.

Judge Rogers also chastised Uber's attorneys for trying to use the drivers' receipts as evidence to support their

arguments.

"It's not relevant to me,” the judge said. “If you have done it wrong for years under the contract, who cares

what the receipts show?"

At the end of the hearing, Judge Rogers said it’s not clear that the contracts supports what Uber was doing,

but she said she wants to take another look at the contract before ruling on the pending motions.

According to Stern, the 9,700 potential class members earned approximately $1.4 million during the

proposed class period. It's unclear if a portion of that amount or if all of it would be subject to damages.

The drivers are represented by John G. Crabtree of Crabtree & Auslander.

Uber is represented by William L. Stern and Alexandra E. Laks of Morrison & Foerster LLP.

The case is Congdon v. Uber Technologies Inc. et al., case number 4:16-cv-02499, in the U.S. District Court

for the Northern District of California.

--Editing by Nicole Bleier.