On August 11, 2017 Uber came to an agreement to pay $20 million to settle a class action lawsuit that accused Uber of sending text messages to drivers and riders without their permission.
The lawsuit did not have any guarantees of success regarding whether they would receive proper class certification or if they could succeed at trial. Now, with this large settlement, those worries are gone. “By any measure, this settlement is an extraordinary result. Plaintiffs have secured a $20 million settlement fund in a case where class certification and success on the merits were far from guaranteed.”
Class certifications are appealable. If this happened, the case could be tied up in litigation for years. Moreover, the Plaintiffs could also have evidentiary issues with the text messages and proving how they were sent.
The Plaintiffs alleged that Uber sent unsolicited text messages that encouraged them to become drivers for Uber in violation of the Telephone Consumer Protection Act.The text messages told them to begin the sign up process to become a driver. Some the of the named Plaintiffs are Jonathan Grindell, Jennifer Reilly, James Lathrop, Sandeep Pal and Justin Bartolet.
The settlement was reached with actions that were pending in Illinois as well as California. It is clear that the cases were brought in these liberal states because they would have greater chances of succeeding.
As a part of the settlement, Uber is going to discontinue its refer a friend program where drivers would receive compensation if they got their friends to drive with Uber as well.
The settlement creates three classes of settlements. The first one includes anyone who was texted by Uber about the refer a friend program. The second is for anyone who signed up to be a driver and received texts after the fact. The third class is for anyone else who Uber sent text messages to without permission.
This case is like many cases where Plaintiffs are taking advantage of the fact that large businesses like to send out marketing materials over the internet and cell phones and they do not always do proper legal research before doing so.
Many companies have been sued over sending improper spam over email, violating the federal do not call list, or improperly selling customer data to third party companies.
This settlement stands as a warning to all business to review the state specific advertising laws because Plaintiffs lawyers are hoping that you do not.
