STORY BY: DANIEL WIESSNER
(Reuters) – A federal judge in California has ruled that Uber Technologies Inc violated its agreements with drivers by subtracting a one-dollar “safe rides fee” from their pay on some trips.
U.S. District Judge Yvonne Gonzalez Rogers in Oakland on Thursday granted the plaintiffs’ motion for summary judgment and said that under the agreements, Uber was required to charge the fee to passengers, and not drivers.
Rogers also granted the plaintiffs’ motion to certify a nationwide class of about 9,600 drivers who have opted out of an arbitration agreement with the company.
The ruling only applies to fees for short trips, called “minimum fare rides,” in which Uber charged a minimum fare rather than charging by time and distance. Uber in court filings estimated that it would owe the drivers $1.4 million in compensatory damages if it lost the case.
John Crabtree of Crabtree Law in Seattle, who represents the plaintiffs, said Uber’s estimate could be low, and that he would also seek millions of dollars in punitive damages. He said a significant percentage of Uber drivers’ trips are minimum fare rides.
Uber spokesman Matt Wing said the company is reviewing the decision.
In 2014, Uber announced that it would charge riders a one-dollar fee that would be used to conduct more rigorous background checks of drivers and provide them with safety training.
Uber in June proposed a $32.5 million settlement in a separate case in federal court in San Francisco filed by passengers who say they should not have been charged the “safe rides” fee because Uber did not conduct industry-leading background checks as it had claimed. The settlement must still be approved by a federal judge.
Thursday’s ruling stems from a lawsuit filed in 2016 by four drivers who accused Uber of lowering its minimum fare by one dollar, and then adding the fee on top of it, instead of charging the $1 fee directly to riders.
They claimed Uber breached agreements signed by drivers in 2013 and 2014 that required the company to pay them 80 percent of any fare. The plaintiffs said that after the safe rides fee was deducted, their pay for short trips dipped below that level.
Uber argued that under the agreements, it was permitted to deduct fees from the “total fare” charged to passengers, and that for short trips, the minimum fare was the total fare.
But Rogers on Thursday said that the agreements treated the minimum fare and various fees, including the safe rides fee, as separate components of the total fare.
Crabtree, the plaintiffs’ lawyer, said class members will be owed 80 cents for every minimum fare ride they gave, which is 80 percent of the one-dollar fee subtracted from their pay.
Rogers certified a nationwide class, rejecting Uber’s claim that the named plaintiffs did not have standing to sue on behalf of the class because their depositions contradicted certain claims in the lawsuit.
The judge said that in order to certify the class, the plaintiffs only had to allege that they suffered the same type of injury as other drivers.
The case is Congdon v. Uber Technologies Inc, U.S. District Court for the Northern District of California, No. 4:16-cv-2499