Uber wins ruling in bid to keep price-fix suit out of court

2017-08-18 12:23 - Chris Dolmetsch, Bloomberg News
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New York - Uber may be able to force a feud over price-fixing claims with a Connecticut customer into private arbitration, a New York appeals panel ruled on Thursday in a victory for the company’s efforts to settle disputes out of court.

The appeals court in Manhattan on Thursday reversed a 2016 decision by US District Judge Jed Rakoff, who said Uber’s online user agreement didn’t provide the customer with enough notice that disputes would be heard in private arbitration for it to be binding.

The case is one of several cases testing the ride-hailing company’s attempts to force disputes into arbitration and away from public courtrooms, a tactic that former CEO Travis Kalanick has also used even after being ousted from the company in June. Earlier this week, Kalanick said a suit brought by the venture-capital firm Benchmark seeking his removal from Uber’s board should be heard in arbitration.

Uber is also attempting to move its fight with Waymo over trade secrets for driverless cars into arbitration. It won a similar battle in California last year when a federal appeals court ruled that most Uber drivers can be forced to resolve their disputes through arbitration.

The Connecticut customer, Spencer Meyer, sued Uber in 2015 saying that its pricing algorithm violates antitrust laws used to protect customers from price manipulation. He is seeking damages on behalf of millions of US riders who rely on the company for transportation.

Rakoff in July 2016 declined Uber’s request to throw out the suit and have the matter sent to an arbitrator. The judge said the process Meyer used to register for Uber’s service didn’t adequately notify him that he was waiving his right to have claims heard in court.

The appeals court found that Uber provided "reasonably conspicuous notice" of its terms of service and that Meyer agreed to arbitrate his claims, saying that he "unambiguously manifested his assent." It sent the case back to Rakoff to consider Meyer’s argument that Uber waived its right to arbitration in the dispute by actively litigating the case.

“This ruling does not grant defendants the right to throw this case into arbitration,” Meyer’s lawyer Brian Feldman said in an emailed statement. “The defence waived that right. We look forward to pressing ahead with the litigation.”

An Uber representative didn’t immediately return an email seeking comment on the ruling.

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