• Paul Peter Nicolai

Uber’s Arbitration Terms Ruled Unenforceable

Updated: Apr 17, 2020

A plaintiff alleged she suffered severe personal injuries when her Uber driver ran a red light and crashed into another vehicle. Uber moved to compel arbitration based on an arbitration clause in its terms and conditions she created her account and on subsequent modifications sent by email several years later. The court found Uber failed to enter into an enforceable arbitration agreement and allowed the case to continue.

After reviewing screenshots of the sign-up process when the plaintiff created her account, the court found the screens did not properly communicate an offer to arbitrate under Pennsylvania law. The sign up process did not contain a check-box to confirm the user had read the terms and conditions, did not require the user to click on the hyperlink to complete the registration process, did not use the typical blue underlined text for the hyperlink, and did not suggest the user read the terms. The court felt Uber’s failure to adequately communicate an offer to arbitrate in a definite manner failed to create a contract.

WHY THIS IS IMPORTANT…The case illustrates the danger of not having a sign-up process that obtains explicit consent and trying to modify terms and conditions without obtaining and recording explicit consent.

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