July 21, 2016: Judge Baylson Denies Uber’s Motion to Dismiss and Compel Arbitration

Defendants’ motion to dismiss and compel arbitration was denied on July 21, 2016.  The court’s opinion highlighted one of defendants’ admissions at oral argument:

“In addition, Defendants do not dispute validity of the Plaintiffs’ opt-outs in the following exchange before the Court:

Mr. Abay: If [Judge Chen’s Rule 23(d) Order], which is the cornerstone of defendants’ motion, if that is vacated, then defendants must give[] effect to my client’s opt-out notices.

The Court: What is the defense response to that?

Mr. Hank: Your Honor, the short answer is yes[.]

As this exchange demonstrates, Defendants challenge the continued validity of the Arbitration Provision, not Plaintiffs’ compliance with the procedures for opting out of the Arbitration Provision. But the Court has already found that, as a matter of law, Judge Chen’s Rule 23(d) Order does not render the Arbitration Provision a nullity. There is thus no material dispute that Plaintiffs did not agree to arbitrate issues of arbitrability because Plaintiffs opted out from the Arbitration Provision.”

In the end, the court honored the plaintiffs’ decision to opt out of arbitration.  Plaintiffs, therefore, were permitted to proceed with the putative class action in court. 

Note: Many similar class action lawsuits have been dismissed on this very issue.

Opinion Citation: Razak v. Uber Techs., Inc., No. 16-573, 2016 U.S. Dist. LEXIS 95086 (E.D. Pa. July 21, 2016)

Click here to read the opinion: 7-21-16-opinion-denying-motion-to-dismiss-into-arbitration