Uber settles class-action for $28.5 million for misleading claims about drivers’ background checks

On February 12, 2016, Uber agreed to settle a consolidated class-action filed in the U.S. District Court for the Northern District of California (Philliben v. Uber Technologies, Inc. and Mena v. Uber Technologies, Inc.) by paying $28.5 million to approximately 25 million riders and promising to avoid using certain language in safety-related advertising, as well as the term “safe ride fee.”

In their complaint filed in 2014, the plaintiffs alleged that Uber’s claim of conducting “industry-leading background checks” for which they paid a “safe ride fee” of $1 to $2 on top of each fare, was false and misleading. According to the complaint, Uber does not and has never had an “industry-leading background check process.” To the contrary, the complaint stated that background screening by Uber does not involve fingerprint identification and, therefore, cannot ensure that the information obtained from a background check actually pertains to the driver that submitted the information. By contrast, most taxi regulators in United States require drivers to undergo criminal background screening, using fingerprint identification, and typically employing a technology called “Live Scan.”  Going forward, Uber said it will rename the “safe ride fee” as a “booking fee” which will be used to cover safety and additional future operational costs.

If the judge approves the settlement, members of the class who rode in an Uber vehicle in the United States between January 1, 2013 and January 31, 2016 will be eligible to receive a portion of the settlement.  If that pot is divided evenly among Uber’s 25 million passengers, after attorneys’ fees, each will get around $1.

Read the consolidated class-action complaint here.