Uber Demonstrates the Danger of Arbitration Clauses

A recent article in New York magazine highlights the ever-growing issue of arbitration clauses and the danger they pose to Americans’ basic rights. Citing reporting that originally appeared in The Guardian, the magazine details a shocking, but all-too-common, story: people who have been treated badly, even criminally, only to discover that they had given away their right to a court hearing without even realizing it.

According to the magazine, “nine women have banded together in a class-action suit against Uber. The women all allege that they were assaulted by their drivers… Uber has argued that this suit should be settled by closed-door arbitration.” According to the original Guardian report “Uber has filed a motion arguing that the riders agreed to privately arbitrate all disputes when they signed up for the ride-share service and have no right to file a lawsuit.”

As I have noted in previous blogs clauses like these pose a number of legal issues. First, there is the simple question of whether people have really agreed to give up their constitutional right to have access to a court of law. However, lengthy terms of service which are not subject to negotiation or reservations raise deeper issues. Most of us ‘agree’ to these in only the most nominal sense. Yet it is an open question whether this system is really compatible with the constitution. Even if we assume that many people are actually reading these dense, jargon-filled documents, there is a broader question, is it appropriate to require citizens to give up basic constitutional rights as a condition of participating in digital (or digitally-based) activities that have become central to modern life?

This is especially important when we consider the ways the arbitration system tilts the playing field in favor of corporations. It is companies, not individuals, who pay and, to all intents and purposes, select the arbitrators. The system strips customers of their 7th Amendment right to a jury trial and the right to appeal if they lose in the trial court. It essentially guarantees that few, if any, reports of a company’s negligence will reach the media.

In short, streamlining the complaints process has very little to do with arbitration. Protecting the reputation of misbehaving companies, on the other hand, is central to its success.

As a Portland attorney with a practice focused on helping individual Oregonians and Washingtonians defend their rights I hope the Uber case will be successful. Success would not only mean justice for the victims who brought the case. It would also help the broader cause of ensuring that every American gets the day in court that the constitution promises them.


New York Magazine: Women Accusing Uber Drivers of Rape Could Have to Settle Behind Closed Doors

50 SW Pine St 3rd Floor Portland, OR 97204 Telephone: (503) 226-3844 Fax: (503) 943-6670 Email: matthew@mdkaplanlaw.com
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