Antitrust Class Actions

Court Denies Uber Motion to Compel Arbitration of Class Antitrust Claims Because Mobile App’s Terms of Service Were Inconspicuous

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Late last week, influential federal judge Jed Rakoff of the Southern District of New York denied a motion to compel arbitration of an antitrust class action complaint pending against ride-hailing pioneer Uber Technologies. The case, Meyer v. Kalanick and Uber Technologies, Inc., Case No. 15 Civ. 9796 (S.D.N.Y. July 29, 2016),  may represent an installment in the pendulum swing against mandatory arbitration and class action waiver clauses in consumer contracts.

Uber’s mobile app contains a hyperlink to terms and conditions that include a mandatory arbitration clause.  But Judge Rakoff, applying California law, ruled that consumers registering for Uber service were not obligated to visit or click through those terms in the app version at issue, and therefore never assented to arbitration. The court also found that Uber’s terms of service hyperlink was presented to Android users in “barely legible” fine print at the bottom of the screen, and that its arbitration clause was buried in “nine pages of highly legalistic