Uber Tells U.S. Court Riders Don't Have the Right to Sue

Turns out that agreeing to the terms of service means giving up your right to take Uber to court.

AP Photo/Seth Wenig, File

That's why you always read the fine print. On Friday, Uber claimed in U.S. district court that users of the ride-hailing app surrender their right to sue the company by agreeing to the terms of service of the popular app, and urged the court to divert a current lawsuit against Uber to an alternate means of settlement. 

Uber's representative, Theodore Boutrous, asked a three-judge panel from the 2nd U.S. Circuit Court of Appeals in New York to send a class action lawsuit filed by Spencer Meyer of Connecticut regarding surge pricing practices to arbitration, according to Reuters.

Uber, like many Silicon Valley companies, includes a line in its terms of service that requires users to settle legal disagreements with the company via private arbitration in lieu of a traditional trial. 

A previous request by Uber to send Meyer's case to arbitration was shot down last year by U.S. District Judge Jed Rakoff, who said the practice of hiding arbitration agreements in terms of service threatened the basic right to a jury trial. "This most precious and fundamental right can be waived only if the waiver is knowing and voluntary," he said, according to Reuters.

Boutrous stated this week that no other judge has ruled in the same manner as Rakoff when faced with a similar user agreement. 

Meyer's rep, Jeffrey Wadsworth, said it was not reasonable to expect customers to understand complex legal issues—such as giving up the right to sue—when accepting a terms of service agreement.

To register means to put your name on an official list," Wadsworth said, according to Reuters. "It does not mean you're engaging in some complex contractual transaction."

But some members of the panel sounded less convinced of the plaintiff's argument this week, according to Reuters. Judges Reena Raggi and Susan Carney reportedly pointed out that by providing credit card info, people signing up for Uber were going beyond simply registering on a list.