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Uber Settles Another Case

Previously, we have written about cases involving Uber Inc. ("Uber" or the "Company") and its ridesharing safety checks. In February, Uber agreed to settle a class action pending in California federal court that raised questions about the Company's "safe ride" fees. The proposed $28.5 million settlement will benefit roughly 25 million riders that utilized the ride hail company from January 2013 to January 2016. Now, Uber has chosen to settle another case in which the State of California filed suit because Uber allegedly misled consumers because of the way it claimed to screen drivers.

Uber settled the case for $10 million, but there is a provision of the settlement that could add an additional $15 million if Uber does not comply with certain terms of the settlement agreement. Moreover, a permanent injunction was filed against Uber that prohibits it from making false or misleading statements regarding the Company's background checks. Los Angeles District Attorney Jackie Lacey commented, "With this settlement, the ride-sharing company has pledged to communicate honestly about its driver background checks and airport fees, important steps to protecting the residents of California." Similar to the allegations against Uber in the above-mentioned consumer class action, the State of California took issue with Uber claiming to have thorough background checks, but it did not use fingerprint data. Without fingerprint data, the Company could not ensure their background-check information was accurate.

Another issue in the case was a smaller "airport fee toll" charged to consumers. According to the suit, Uber had not obtained proper authorization to conduct commercial operations at California airports. Consumers were charged $4 for rides to the airport even though the Company was not taking that money and paying it to the government. Therefore, it was simply a $4 surcharge for going to the airport.

At its core, this settlement acknowledges the inherently vulnerable position passengers assume when they enter a car with a driver they do not know. Uber's driver safety program has gained notoriety due to several news stories from cities across the country that accused Uber's drivers of various crimes. In the past four months alone, there have been Uber drivers accused of murder, theft, assault, and aggravated assault.

The legal team at SFMS has significant experience litigating class action matters. If you have any questions regarding this subject or this posting, please contact Alec Berin ([email protected]) or Chiharu Sekino ([email protected]). We can also be reached toll-free at (866) 540-5505.

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