Uber to face assault cases
Ruling sets stage for another battle over company’s drivers as contractors or employees
The sexual assault case is one of many challenging Uber’s use of independent contractors. In the two weeks since Uber announced its settlement worth up to $100 million, the company has been hit with at least two similar class-action lawsuits in other states.
SAN FRANCISCO — Setting the stage for another battle over Uber’s business model, a federal judge refused to let the ride-hailing company off the hook for sexual assaults allegedly committed by its drivers — in part because of plausible evidence that those drivers are Uber employees.
Uber had argued that the company is not liable for assaults reported by two passengers last year in Boston and Charleston, South Carolina, because the accused drivers are independent contractors, not employees. But a San Francisco federal judge wasn’t convinced and rejected Uber’s early attempt to throw out claims brought against the company by the victims.
“It may be that facts will ultimately be revealed that
disprove plaintiffs’ allegations or that tilt the scales toward a finding that Uber drivers are independent contractors,” U.S. District Judge Susan Illston wrote in a Wednesday ruling. “However, taking the allegations in the amended complaint as true, plaintiffs have alleged sufficient facts that an employment relationship may plausibly exist.”
Illston’s ruling moves the case one step closer to trial, but it doesn’t guarantee that the plaintiffs will prevail or that the Uber drivers ultimately will be deemed employees.
Uber’s reliance on a workforce of independent contractors has been challenged by drivers who want employee benefits such as minimum wage, overtime pay and reimbursement for driving expenses. Uber agreed to pay up to $100 million to resolve a highprofile class-action lawsuit over the issue in April, two months before the case was scheduled to go to trial in San Francisco. That deal doesn’t require Uber to change its business model, but neither does it resolve the larger issue of whether the company’s drivers are employees. Instead, the deal leaves the door open for other judges, such as Illston, to weigh in.
If the two drivers in the sexual assault case ultimately are found to be Uber employees, the company wouldn’t automatically be forced to change the status of all drivers. But such a ruling could be used as effective ammunition for other plaintiffs trying to upend Uber’s business model.
“Judge Illston is a senior judge — she is very well respected,” said San Francisco employment attorney Daniel Hutchinson. “Whatever reasoning she would have one way or another I imagine would be very persuasive to any judge dealing with similar issues.”
But San Francisco attorney Kathy Huibonhoa, who represents employers in workplace disputes, pointed out that the factors the court considers when determining employee status for a sexual assault case might be different from those it uses for a wage-and-hour case.
“I don’t think it would have broader impact,” she said of Illston’s case.
Uber declined to comment.
Plaintiffs in the sexual assault case, referred to in court filings as “Jane Doe 1” and “Jane Doe 2,” brought claims against Uber in October that include assault, battery, false imprisonment and negligent hiring. Jane Doe 2 claims her driver demanded oral sex as payment for her ride, then locked the car doors, drove to a remote parking lot and “proceeded to viciously rape her.”
Plaintiffs claim the driver accused in that Charleston attack, Patrick Aiello, had been convicted of assault in 2003 — a fact that was overlooked by Uber in his background check. Uber called the conviction a “12year-old disorderly persons offense that could have been expunged.” But Illston ruled there are sufficient facts to suggest that Uber should have known about Aiello’s criminal history and allowed the plaintiffs to proceed with their claim that Uber was negligent in hiring him.
The sexual assault case is one of many challenging Uber’s use of independent contractors. In the two weeks since Uber announced its settlement worth up to $100 million, the company has been hit with at least two similar class-action lawsuits in other states. But because Uber asks drivers to agree to resolve disputes out of court using a private arbitrator, it may be difficult for such cases to proceed to a jury. Over the past month, courts in Arizona, Florida and Maryland have forced other contractor cases into arbitration.
“It is very difficult to change companies’ behavior directly through this litigation,” Boston-based attorney Shannon Liss-Riordan, who represents drivers in the San Francisco case that settled, wrote in an email, “so oftentimes the effect we can have is indirect — we win important concessions (like we did in the Uber settlement).”