18th Annual Workplace Class Action Report - 2022 Edition

210 Annual Workplace Class Action Litigation Report: 2022 Edition Haider, et al. v. Lyft, Inc., 2021 U.S. Dist. LEXIS 147975 (S.D.N.Y. Aug. 6, 2021). Plaintiffs, a group of rideshare drivers, filed a class action alleging that Defendant violated the FLSA and the New York Labor Law by treating drivers as independent contractors rather than employees. Defendant filed a motion to compel arbitration of Plaintiffs’ claims pursuant to an arbitration agreement contained in terms of service in the independent contractor agreement that Plaintiffs had signed. The Court granted the motion. The Court previously had held that Defendant’s rideshare divers were exempt from the Federal Arbitration Act under the statutory exemption for transportation workers. Defendant asserted that previously the drivers agreed to revised terms of service, which provided that Delaware law would govern the parties’ arbitration agreement in the event the Federal Arbitration Act did not apply. Plaintiffs contended that the Court should not enforce the choice-of-law provision. Plaintiffs asserted two main arguments to the enforcement of the arbitration agreement, including: (i) that the December 2020 terms of service were unenforceable because Defendant introduced them after the outset of the litigation; and (ii) that they opted-out of the revisions to the arbitration provision. Plaintiffs argued that because Defendant’s December 2020 terms of service were drafted by an attorney, presenting those terms to the drivers violated the rule about attorney communications with represented parties. The Court disagreed. It ruled that Defendant’s attorneys did not engaged in inappropriate communication with the parties. Instead, they had drafted language for the revised terms of service, and the drivers, in order to continue driving for Defendant, agreed to these new terms. Plaintiff further alleged that they opted-out of the December 2020 terms of service, which allowed drivers to opt-out by sending an email to Defendant "within 30 days of the date this Agreement is executed by you." Id . at *8. The Court disagreed on the grounds that Plaintiffs did not email Defendant within 30 days of executing the agreement, and therefore, they assented to the arbitration provision. The Court therefore determined that Plaintiffs’ claims were subject to arbitration under Delaware law, and it granted Defendant’s motion to compel. Hamrick, et al. v. Partsfleet, LLC, 2021 U.S. App. LEXIS 18488 (11th Cir. June 22, 2021). Plaintiffs, a group of “final-mile delivery drivers,” brought a putative collective action alleging that Defendant misclassified the drivers as independent contractors resulting in overtime violations pursuant to the FLSA. Defendant moved to compel arbitration pursuant to the parties’ agreement. Plaintiffs responded that the drivers were exempt from arbitration because they were employed as transportation workers and transported goods and materials that had moved in the flow of interstate commerce, and therefore the drivers fell within the transportation worker exemption of the Federal Arbitration Act (“FAA”). Plaintiffs also argued that state arbitration laws did not apply because the arbitration provision in the independent contractor agreements exclusively referenced the FAA as the governing law that either party must submit disputes between them to arbitration. The District Court denied Defendant’s motion to compel arbitration on the grounds that the drivers were transportation workers under the FAA , and therefore the Act did not apply to the drivers because they transported goods that had traveled in interstate commerce and the transportation of goods in interstate commerce was not incidental to their job. Second, the District Court ruled that Defendant could not compel arbitration under state arbitration laws because the parties, through the arbitration provisions of the independent contractor agreements, which specifically referenced the FAA. On Defendant’s appeal, the Eleventh Circuit reversed as to the District Court’s order denying Defendant’s motion to compel arbitration under the FAA and remanded for the District Court to determine whether the drivers were employed in the transportation industry and whether they actually engaged in interstate commerce. In so ruling the Eleventh Circuit concluded that the District Court misapplied Hill v. Rent- A-Center, Inc. , 398 F.3d 1286, 1290 (11th Cir. 2005), and erred when it determined that the exemption applied. Specifically, the Eleventh Circuit found that the District Court erred where it focused on the movement of the goods instead of the collective group of workers, and thereby concluded that the drivers fell within the transportation worker exemption because the goods at issue in this case originated in interstate commerce. Additionally, the Eleventh Circuit dismissed for lack of appellate jurisdiction Defendant’s appeal of the part of the District Court’s order denying the motion to compel arbitration under state arbitration law. Defendant attempted to appeal this part of the District Court’s order but the Eleventh Circuit found that the order was interlocutory, and there no exception to the final-order rule for orders denying motions to compel arbitration under state law. Further, because the District Court’s ruling on the state law issue was not inextricably intertwined with – or necessary to ensure meaningful review of – the applicability of the FAA, the Eleventh Circuit lacked appellate jurisdiction. For these reasons, the Eleventh Circuit reversed in part the District Court’s order denying Defendant’s motion to compel arbitration. Id. at *33.