Uber can challenge California lawsuit alleging drivers were misclassified, judge rules
The court certified a class of more than 4,800 Uber drivers who allege they were wrongly classified as independent contractors under Assembly Bill 5
Uber Technologies Inc. can challenge a lawsuit alleging the company misclassified California drivers as independent contractors.
That ruling was made Thursday by a U.S. District Court judge for the Northern District of California.
The ride-hailing company is arguing that a recently enacted ballot initiative is retroactive, according to Bloomberg Law.
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The court certified a class of more than 4,800 Uber drivers who allege they were wrongly classified as independent contractors under Assembly Bill 5, the state’s strict worker status rule.
Uber’s motion was granted to amend its reply to include Proposition 22, a ballot initiative approved by voters in November, which excludes ride-share and delivery drivers from the requirements of the Assembly bill.
Proposition 22 asked voters whether Uber, Lyft, and other app-based drivers should remain independent contractors or be eligible for the benefits that come with being company employees.
Uber's challenge will include two defenses saying Proposition 22 presents a defense to independent contractor claims arising after its enactment, and that the class’ claims for the period before its enactment are abated under the new rule, according to Bloomberg.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| UBER | UBER TECHNOLOGIES INC. | 71.51 | +1.87 | +2.69% |
| LYFT | LYFT INC. | 16.79 | +0.50 | +3.07% |
In certifying the class, Judge Edward M. Chen initially ruled that Proposition 22 didn’t apply retroactively, and therefore served only to limit the class period and foreclose damages after the law took effect. In April, he walked back that ruling agreeing with Uber that the retroactive application of the rule is ultimately a merits question that shouldn’t be decided in the context of class certification.
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The class urged Chen to deny Uber’s motion to add the new defenses, arguing the motion is unreasonably delayed, would require them to re-conduct discovery.
The class is prepared to file for summary judgment on Aug. 12.