not a separate cause of action, and Uber has not shown likelihood of success on another cause of This is a contract dispute between plaintiffs Uber Technologies, Inc. and Uber USA, LLC (together, Uber) and defendant the American Arbitration Association, Inc. (AAA) over fees for approximately 31, 500 similarly situated arbitrations. Law360 reported on Justice Reeds preliminary injunction decision here and Justice Ostragers recusal here. Kaplan Hecker & Fink LLP, New York (Roberta A. Kaplan of counsel), for appellants. The CA Rules also allow AAA to exercise sole discretion as to whether to apply the CA Rules, whether to interpret and apply the fee schedule to a particular case or cases, and whether to consider an alternative payment process for multiple case filings. In addition, Uber has asserted counterclaims against its arbitration counterparties seeking reimbursement of the fees at issue, thus cutting against its claim of irreparable harm. Most people either shy away from those kinds of cases, or do them and then get consumed by them, Mr. Katyal said. He was 48. AAA then broke the 40 0 obj ), entered October 15, 2021, ], Inc. v Marathon Dev. Readers are advised that prior results do not guarantee a similar outcome. But some lawyers have discovered that the agreements can be extremely costly for companies if thousands of people bring claims at once. William Spencer Consovoy was born on Aug. 31, 1974, in Plainfield, N.J. Ultimately, Justice Reed sided with AAA, noting Ubers concession that it could pay the invoice without causing it irreparable harm. 2020. While Uber is trying to avoid paying the arbitration fees associated with 31,000 nearly identical cases, it made the business decision to preclude class, collective, or representative claims in its arbitration agreement with its consumers, and AAA's fees are directly attributable to that decision.". Uber Sues AAA to Block $100 million Fees in 'Politically - NICArb Law360and Reutersreported on the decision. Before: Acosta, P.J., Kern, Gonzlez, Shulman, JJ. According to the fee schedule, for each case, Uber would owe AAA a $500 filing fee, a $1,400 standard case management fee, and a $1,500 arbitrator fee, for a total of approximately $107 million if charged the full amount under the fee schedule. respondent. The parties and AAA then engaged in months of fruitless negotiations to come up with a more efficient process for dealing with the 31, 500 arbitration cases. AAA also invoked California Code of Civil Procedure 1281.97 to 1281.99 (the Cal CP Arbitration Rule). Rptr 3d 115, 120-121 [2004]). The law firm Consovoy McCarthy PLLC then gathered more than 31,000 claimants who paid delivery fees to non-Black-owned restaurants and filed arbitration demands claiming that the fees constituted unlawful reverse race discrimination. 4a 3e' @ He knew, if he made a move in this direction, what the first four options his adversaries would take. the fees after the parties could not agree to a more efficient manner of proceeding with over On May 13, 2021, Uber paid the $667,800 in case management fees for the first 477 cases. While Uber is trying to avoid paying the arbitration fees associated with 31, 000 nearly identical cases, it made the business decision to preclude class, collective, or representative claims in its arbitration agreement with its consumers, and AAA's fees are directly attributable to that decision (see Avenue A Assoc. Loan Holder LLC, 174 AD3d 150, 163 [1st Dept 2019]), and here, [or] unfair . Following the death of George Floyd in June 2020, Uber announced it would waive its delivery fee charged to customers for orders placed at certain qualifying Black-owned restaurants from June 4, 2020 through December 1, 2020. The complaint alleges essentially that non-party law firm Consovoy McCarthy PLLC (Consovoy) sought out thousands of Uber drivers to file claims through the firm alleging "reverse discrimination" stemming from Uber's temporary waiver of delivery fees. Rather, the CA Rules repeatedly state AAA will charge fees as outlined in the attached fee schedule. He clerked for Justice Clarence Thomas during the 2008-9 Supreme Court term, and he came away with the conviction that the court was poised to tilt further to the right and that constitutional rulings that had once been considered out of reach by conservatives, on issues like voting rights, abortion and affirmative action, would suddenly be within grasp. endobj Uber commenced its lawsuit after law firm Consovoy McCarthy brought more than 31,000 demands for arbitration on behalf of Uber Eats customers alleging reverse discrimination" arising from Uber's efforts to support Black-owned restaurants following the police killing of George Floyd in May 2020. From October 26, 2020 to December 9, 2020, the Consovoy Firm filed over 31, 000 substantively identical arbitration demands with AAA on behalf of the Uber Eats customers against Uber. In hot-button cases, lot of times passions overtake logic, and that was not the case with him. The petitioners requested the San Francisco court to order Uber to pay the remaining balance of arbitration fees, withdraw the pending action in New York state court, and end any other efforts to escape arbitration. with its reasonable, actual costs. Firm Scores Unanimous Appellate Win for American Arbitration Association Over Uber. While Uber alleges that it, the claimants, and AAA are all bound by the CA Rules and Consumer Due Process Protocol Statement of Principles (Protocol), neither of those documents requires AAA to charge reasonable fees related to its actual costs. startxref In doing so, AAA was arbitration administrator's rules within 30 days of the "due date" is deemed to be "in material 2021-03782. His success helped distinguish the school, in the Virginia suburbs outside Washington, as a hothouse of conservative legal thinking and training. AAA requested substantial reduction to the additional $91 million AAA will invoice to arbitrate the claims, On April 14, a four-judge panel of New York's Appellate Division, First Department ruled that the ride-sharing platform should pay after it could not demonstrate how it would be successful in pursuing claims of breach of contract, fair dealing, unjust enrichment and unfair competition in violation of California's Unfair Competition Law. Law360 and Reuters reported on the decision. <>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI]/Font<>>>/MediaBox[ 0 0 612 792]/Contents 45 0 R /Parent 36 0 R /Type/Page/Tabs/S/Group<>>> I received an email from consovoy McCarthy to accept $370 settlement. After Uber announced in 2020 that its food-delivery branch, Uber Eats, would waive fees for Black-owned businesses, Consovoy McCarthy arranged for some 31,000 complainants to claim. FAQ - New Privacy Policy. consumers receive due process and the impartiality of the arbitrators. Market data provided byFactset. LLC, 92 AD3d 19, 24-25 [1st Dept 2011]; see CPLR 6301). From October 26, 2020, to December 9, 2020, the Consovoy Firm CALIFORNIA COURT RULES UBER CAN CONTINUE PUSHING PRO-GIG WORKER MESSAGES. Uber presented expert testimony from Justice Charles E. Ramos, a retired Commercial Division justice who, until his resignation earlier that week, also served as a judicial hearing officer. Uber then filed this complaint against AAA alleging that its invoicing was unlawful. Schnader Harrison Segal & Lewis LLP, New York (Theodore L. Hecht of counsel), for respondent. Mutual Fund and ETF data provided byRefinitiv Lipper. 2021. As a subscriber, you have 10 gift articles to give each month. ?`Z?01* f3 G, The firm is also behind a landmark lawsuit that. 17200). Uber's motion to dismiss is the latest filing in a multi-case saga that started with lawsuits filed by Uber Eats customers over an allegedly racially discriminatory pricing policy charging. irreparable harm caused by AAA by changing the assigned arbitration organization for the 31,000 While acknowledging this background, Justice Robert Reed of the Commercial Division emphasized that Ubers suit against AAA does not in any way involve an analysis of the merits of the reverse discrimination claims asserted by the Consovoy law firm. Uber and its lawyer Roberta Kaplan didnt respond to requests for comment. asking them to challenge the lawfulness of Uber's policy by claiming it constituted unlawful endobj ' Ul,*tr+}CHrMUfqiKhTQY,!-3$Ew.9%Ko( ~2sa?`}lR82-2z:0Cy:M^[]sxv`s&SK`s{D*c)!@(L8Fbku9 %*eSx/uPfq)P#d%FmLD)x0#Io3~Uyk2YaNXF-b ARRR-K|bXbJ\vvq*A;K5#3B{uc/}6LinJY/WXWU50~LVrU|v0G{VW3W3IW`k]mb[iU%\~qTM~/Y`;P(X=T>f{ZDQp}H2YpEq '!^g0nKWTa- BM'CY$g,#RGiLl|OaT. Alexander Phipps. NY Slip Op 32080(U). alternative payment process for multiple case filings. 42 0 obj extending the invoicing deadline in the event Uber's claims cannot be adjudicated before (Cal Code Civ Proc 1281.97 [a] [1].) likelihood of success on the merits on any claim, this Court need not reach the issue of arbitral AAA responded by stating if Uber stated it would pay that amount, but "under protest." AAA responded by stating if payment was made under protest[*2] et seq. Law360 Pulse may contact you in your professional capacity with information about our other products, services and events that we believe may be of interest.Youll be able to update your communication preferences via the unsubscribe link provided within our communications.We take your privacy seriously. Uber has received more than 8,500 demands for arbitration over the food delivery app's policy of waiving delivery fees for some Black-owned restaurants. claims down into five different batches, with the first batch containing 477 non-California cases, i1=fwdhg="XP.6]';QF`?[# Uber Calls $91M Arbitration Association Fee A 'Ransom' Firm Scores Unanimous Appellate Win for American Arbitration Mr. Consovoy then worked closely with Mr. Blum on cases against Harvard and the University of North Carolina, arguing that their affirmative action programs and, by extension, college and university affirmative action programs generally were unconstitutional. <> Meanwhile, Uber is also facing other legal battles. Uber commenced its lawsuit in New York Supreme Court's Commercial Division against AAA after law firm Consovoy McCarthy brought more than 31,000 demands for arbitration on behalf of Uber Eats customers alleging "reverse discrimination" arising from Uber's efforts to show support for Black-owned restaurants following the police killing of George