Uber Cancellation Fee Class Action Lawsuit Heads to Arbitration

A California federal judge has ordered a plaintiff who filed a class action lawsuit over Uber’s allegedly unfair ride cancellation fees to arbitrate his dispute.

Last week, U.S. District Judge Richard Seeborg said plaintiff Michael Cordas was bound by an arbitration clause he had accepted as part of the terms and conditions he agreed to when he signed up for the Uber app.

The judge was unpersuaded by Cordas’s argument that the agreement was not valid because users clicked “Done” when they set up their Uber accounts, and not “I agree to the terms and conditions.”

According to the Uber class action lawsuit, Cordas was notified that he would be charged cancellation fees by Uber even though he allegedly never cancelled his ride.

He accused Uber of implementing deceptive and misleading business practices in order to “generate millions of dollars based on their fraudulent, unearned and unconscionable ‘Cancellation Fees.’”

Uber subsequently filed a motion to compel arbitration, arguing Cordas had agreed to the ride-hailing service’s terms and conditions which require him to arbitrate this dispute.

Cordas fought to keep the issues in his Uber class action lawsuit from being addressed in arbitration, but Judge Seeborg found his arguments “unavailing.”

The judge rejected an argument by Cordas that he was not notified about the terms and conditions when he signed up for the Uber app, finding that Cordas failed to support his claim that the phone settings and phone screen did not display a notification of the terms and conditions.

“Cordas does not claim to have had his phone in a horizontal orientation, does not say what his settings were at the time he signed up, offers no testimony or evidence regarding what he did see on his screen, and offers no evidence to rebut [Uber’s] reasoned declaration other than his own conclusory allegations that he never received notice of the terms and conditions and that [Uber’s] declaration is false and inadequate,” Judge Seeborg writes.

“In short, Cordas raises no genuine dispute of any material fact, and it is proper to conclude, as a matter of law, that he was on notice of Uber’s terms and conditions, and assented to them in signing up for Uber,” the judge concludes.

Judge Seeborg also rejects Cordas’s argument that, by clicking “Done” to complete the sign-up process, he was unaware that he was assenting to the Uber terms and conditions. The judge notes that there is a clear notice near the “Done” button that says: “By creating an Uber account, you agree to the Terms & Conditions and Privacy Policy.”

Since Cordas clicked “Done,” he affirmatively acknowledged the terms and conditions and is therefore bound by their terms, Judge Seeborg concludes.

The judge was also persuaded by Uber’s argument that the issue of whether Cordas’s dispute should be handled in arbitration would be determined by an arbitrator. Uber had argued that the arbitration agreement’s incorporation of the AAA Commercial Arbitration Rules “shows the parties’ clear and unmistakable intent to delegate arbitrability questions to an arbitrator.”

Judge Seeborg issued a stay on the Uber cancellation fees class action lawsuit pending completion of the arbitration.

Cordas is represented by Kristopher Philip Badame, Joseph Holland Hunter and Michele Eileen Pillette of Badame & Associates APC.

The Uber Cancellation Fee Class Action Lawsuit is Cordas v. Uber Technologies Inc., Case No. 3:16-cv-04065, in the U.S. District Court for the Northern District of California.