DocketNumber: Case No. 16–cv–02499–YGR
Citation Numbers: 291 F. Supp. 3d 1012
Filed Date: 3/8/2018
Status: Precedential
Modified Date: 7/25/2022
a. Rules Governing Contract Interpretation
"Interpretation of a contract is a matter of law, as is the determination of whether a contract is ambiguous." Beck Park Apartments v. U.S. Dep't of Housing & Urban Dev. ,
The "clear and explicit meaning" of contractual provisions "interpreted in their ordinary and popular sense, unless used by the parties in a technical sense or a special meaning is given to them by usage, controls judicial interpretation." Santisas ,
Extrinsic evidence is generally not admissible to contradict or supplement the terms of a fully integrated contract, but it may be used "to explain or interpret ambiguous contract language." Lonely Maiden Prods., LLC v. GoldenTree Asset Mgmt., LP ,
b. Analysis
The parties agree that no genuine issues of material fact exist regarding (1) the existence of the Agreement or (2) plaintiffs' performance under the Agreement. Rather, the motions focus on the element of breach. Thus, the Court begins with the plain language of the Agreement.
Pursuant to Paragraph 4.1, certain variables might influence an individual driver's remittance. Moreover, the Service Fee Schedule instructs that drivers are to pay Uber a certain percentage "of the total fare minus the $1 Safe Rides Fee, calculated pursuant to the rate schedule below ." (Service Fee Schedule (emphasis supplied).) Thus, by the plain contractual language, "total fare" is not calculated pursuant to the Paragraph 4.1 Fare Calculation and, accordingly, is not limited to the sum of the three Fare components.
Because "total fare" is the product of addition based on the components shown in the Service Fee Schedule,
With respect to the meaning of "total fare" in the context of minimum fare rides , the components to add, or to "total," differ. In that context, the Court again *1023excludes the "Cancellation Fee" component, as well as the "Base Fare," "Per Mile," and "Per Minute" components (given the nature of the "Minimum Fare," i.e. , a value greater than the sum resulting from the Fare Calculation). The components from the Service Fee Schedule that remain to add, or to "total," are the "Minimum Fare" and the "Safe Rides Fee." Therefore, pursuant to the contractual language, the "total fare" in the context of minimum fare rides equals the sum of these two independent components.
For the reasons set forth above, Uber's assertions that "Minimum Fare" should be defined as a "total fare" inclusive of the Safe Rides Fee do not persuade. (See Transcript at 13:16-21, 18:13-14; Defendants' Cross-MSJ at 6 n.9, 8.) The Service Fee Schedule identifies the terms "Minimum Fare" and the "Safe Rides Fee" as separate components that, together , make up the "total fare" in the context of minimum fare rides. As with the "total fare" in the context of Fare rides, the component parts of "total fare" in the context of minimum fare rides are to be treated separately, rather than treating the "Safe Rides Fee" as subsumed within the "Minimum Fare." Applying the Service Fee formula, and consistent with the formula used for Fares, Uber would receive a Service Fee in the amount of "20%...of the total fare [i.e. , the Minimum Fare plus the Safe Rides Fee] minus the $1 Safe Rides Fee." Thus, as stated within the context of the Service Fee Schedule referenced herein, Uber would receive "20%...of the total fare [$4 + $1] minus the $1 Safe Rides Fee," or 20% of ($5.00-$1.00), which equals $0.80. Nothing in the Agreement indicates that Uber would necessarily collect the Safe Rides Fee in the context of minimum fare rides, given the unique character of those fares.
Uber's reliance on its own post hoc conduct to justify its interpretation of the Agreement begs the question. Such extrinsic evidence is not relevant. That Uber may have raised the "Minimum Fare" by an amount equal to the Safe Rides Fee and drivers "earned exactly the same amount after, as before, the SRF [Safe Rides Fee]" is irrelevant and a red herring. (Defendants' Cross-MSJ at 12; see also Defendants' Reply to Cross-MSJ at 3 n.2.) As Uber would have it, its decision to raise the suggested fare amount in the context of minimum fare rides by $1.00 allowed it to extract unilaterally the $1.00 Safe Rides Fee from the "Minimum Fare," which, as noted above, Uber argues is a type of "total fare" inclusive of the Safe Rides Fee. Nothing in the Agreement provides *1024a formula for Uber to deduct $1.00 from the Minimum Fare and then deduct another 20% from the balance. The fact that Uber chose not to follow the precise terms of the Agreement for the 19 months of the class period and is now attempting to rationalize its conduct is not relevant to the instant claim.
By extracting $1.00 from the "Minimum Fare" before making its remittance to drivers, Uber breached the plain terms of the Agreement. As shown above, it was contractually entitled only to deduct 20% of the total amount charged on minimum fare rides, and the drivers were entitled to 80% of the same.
2. Damages
Having concluded that drivers were contractually entitled to the full amount of the "Minimum Fare" on minimum fare rides, minus only Uber's contractual Service Fee and any separately-agreed amount pursuant to Paragraph 4.1 of the Agreement, Uber's extraction of an amount equal to the Safe Rides Fee from drivers' fares on minimum fare rides directly decreased Uber's remittance to drivers. Thus, there is no question that drivers were financially harmed by Uber's breach of contract.
The Court therefore GRANTS plaintiffs' motion for summary judgment as to their breach of contract claim and DENIES Uber's cross-motion.
3. Conversion
"Under California law, a plaintiff must plead three elements to state a claim for conversion: (1) ownership or right to possession of personal property; (2) a defendant's wrongful interference with the claimant's possession; and (3) damage to the claimant." Fields v. Wise Media, LLC , No. C 12-05160 WHA,
*1025The Court therefore GRANTS plaintiffs' motion for summary judgment as to their conversion claim and DENIES Uber's cross-motion.
III. MOTION FOR CLASS CERTIFICATION
Plaintiffs move to certify the following class as a damages class pursuant to Federal Rule of Civil Procedure 23(b)(3), with plaintiffs Matthew Clark, Ryan Cowden, Dominicus Rooijackers, and Jason Rosenberg as the class representatives:
(A) all persons in the United States; (B) who entered the 2013 Agreement, the June 2014 Agreement, or the November 2014 Agreement, or a combination of those agreements; (C) opted-out of arbitration under the last Uber driver contract the person executed; and (D) provided at least one minimum fare ride on the UberX platform for which a Safe Rides Fee applied before November 16, 2015.
(Class Cert. Motion at 3.)
A. Legal Standard
Under Rule 23(a), the Court may certify a class only where: "(1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class." Fed. R. Civ. P. 23(a).
Once plaintiffs establish that the threshold requirements of Rule 23(a) are met, plaintiffs must then show "through evidentiary proof" that a class is appropriate for certification under one of the provisions in Rule 23(b). Comcast Corp. v. Behrend ,
"[A] court's class-certification analysis must be 'rigorous' and may 'entail some overlap with the merits of the plaintiff's underlying claim[.]' " Amgen, Inc. v. Conn. Ret. Plans & Trust Funds ,
*1026B. Discussion
Uber concedes that plaintiffs have satisfied the numerosity, commonality, predominance, and superiority requirements for certification of the proposed Rule 23(b)(3) class. Uber contends only that plaintiffs are not typical (and for the same reasons are not adequate) and that the class definition is overbroad. With regard to typicality, Uber raises two arguments: (1) plaintiffs have no standing; and (2) plaintiffs' depositions have repudiated key averments in the FAC. The Court addresses each argument in turn, followed by a discussion of Uber's argument concerning the scope of the class definition.
1. Typicality: Challenge Based on Lack of Standing
As an initial matter, the parties dispute whether issues of standing are properly classified under the typicality requirement rather than as a separate issue. Uber argues that plaintiffs lack Article III standing and thus cannot be typical of a putative class. Plaintiffs respond that typicality does not involve an inquiry into plaintiffs' standing.
Uber does not persuade. The Ninth Circuit has distinguished questions of standing from the class certification analysis. In Melendres v. Arpaio ,
Uber raised standing previously in the context of its motion to dismiss, which the Court summarily denied. Its standing argument in that context was essentially the same as it is here-that plaintiffs suffered no injury because drivers' fares were not reduced by the amount of the Safe Rides Fee on minimum fare rides. (See Dkt. No. 69 at 12.)
2. Typicality: Challenge Based on Deposition Testimony
Uber additionally argues that plaintiffs are neither typical nor adequate representatives because they have each disavowed the central allegations in the FAC. In support of its argument, Uber cites to various excerpts from plaintiffs' deposition testimony, which allegedly show that all four understood the April 2014 email to mean that drivers were not entitled to the Safe Rides Fee. Plaintiffs do not rebut each instance of deposition testimony individually, but they argue that Uber's questioning at the depositions was based on its theory that the Safe Rides Fee was charged on top of drivers' fares. Thus, plaintiffs contend, based on the hypothetical scenarios posed to them at their depositions, they each answered that they were entitled only to 80% of the "Minimum Fare" not including the SRF. Plaintiffs reiterate their theory that for minimum fare rides, Uber did not add the Safe Rides Fee on top of the "Minimum Fare" as it represented it would. Plaintiffs maintain that, in that context, their claims are typical of the claims of the class.
Uber does not persuade. Again it asks the Court to make a merits determination that the Agreement actually allowed Uber to collect the Safe Rides Fee in the manner that it did during the Class Period. However, the central complaint is that the Agreement did not so provide. Whether that is correct is irrelevant for class certification purposes. As discussed above, for purposes of typicality, it is enough to find that plaintiffs' theory of their injury is the same theory of injury for the entire class.
*1028The Court thus finds that the typicality and adequacy requirements for class certification are satisfied.
3. Challenge Based on Scope of Class Definition
Uber further argues that to the extent plaintiffs' case for liability relies on Uber's purported assurance in it April 2014 email that riders would pay the Safe Rides Fee, not drivers, the class is overbroad. In relevant part, the April 2014 email states: "For now, the Safe Rides Fee will be included in the fare displayed at the end of a trip, but will not appear on the weekly payment statement. If you are a ridesharing partner, Uber will collect the $1 Safe Rides Fee from the rider, so that this price increase will not affect your earnings." (April 2014 Email at ECF 2.) Thus, Uber contends that if plaintiffs' theory rests on this email, the class must be limited to drivers who activated their Uber accounts prior to May 2014 as those who did so subsequently would not have received the email. Plaintiffs state that the April 2014 email is not dispositive, but merely provides context for the Agreement. Thus, plaintiffs argue, receipt of the email should not be deemed necessary for class membership, but if it were, the proper course would be to create two subclasses rather than denial of class certification.
The parties do not elaborate much on these arguments. However, because receipt of the April 2014 email has no bearing on plaintiffs' claims for breach of contract and conversion, as evidenced by the Court's contractual analysis above, it has no effect on the Court's class certification analysis.
IV. CONCLUSION
For the foregoing reasons, the Court ORDERS as follows:
1. The Court GRANTS plaintiffs' motion for summary judgment.
2. The Court DENIES Uber's cross-motion for summary judgment.
3. The Court GRANTS plaintiffs' motion for class certification under Rule 23(b)(3) and CERTIFIES the following class: All persons in the United States who (A) entered the 2013 Agreement, the June 2014 Agreement, or the November 2014 Agreement, or a combination of those agreements; (B) opted out of arbitration under the last Uber driver contract the person executed; and (C) provided at least one minimum fare ride on the UberX platform for which a Safe Rides Fee applied before November 16, 2015.
4. The Court APPOINTS named plaintiffs Matthew Clark, Ryan Cowden, Dominicus Rooijackers, and Jason Rosenberg as class representatives of the certified class.
5. The Court APPOINTS John G. Crabtree, Charles M. Auslander, George R. Baise, Jr., and Brian Tackenberg of Crabtree & Auslander, LLC, Andrew A. August of Browne George Ross, LLP, and Mark A. Morrison of Morrison and Associates as class counsel.
This Order terminates Docket Numbers 108, 109, and 114.
IT IS SO ORDERED.
A "standard form contract," or "contract of adhesion," signifies "a standardized contract, which, imposed and drafted by the party of superior bargaining strength, relegates to the subscribing party only the opportunity to adhere to the contract or reject it." Neal v. State Farm Ins. Cos. ,
This interpretation of "total fare" is supported by the dictionary definition of the word "total." Namely, Merriam-Webster's Online Dictionary defines "total" as, inter alia , "a product of addition." Merriam-Webster's Online Dictionary, https://www.merriam-webster.com/dictionary/total (last visited March 8, 2018).
The parties agree that "total fare" means "the fare that the Rider paid for transportation services, plus the additional dollar Uber added for the Safe Rides Fee." (Plaintiffs' MSJ at 15; see also Defendants' Cross-MSJ at 6.) Indeed, interpreting "total fare" to mean the same thing as Fare would be inconsistent with the latter term's contractual definition: "Fare is calculated based upon a base fare amount plus mileage and/or time amounts...." Agreement ¶ 4.1; see also Headlands Reserve, LLC v. Ctr. For Nat. Lands Mgmt. ,
The Service Fee calculation in the context of cancelled rides is unclear. The Agreement and Service Fee Schedule are silent as to whether a "Cancellation Fee" alone is deemed a "total fare" for purposes of remittance, or whether "total fare" in that context includes the "Cancellation Fee" component and the "Safe Rides Fee" component. Indeed, at oral argument, Uber's counsel admitted to not knowing the nature of the relationship between the "Cancellation Fee" and the "Safe Rides Fee." (See Transcript of Proceedings Held on October 31, 2017, Dkt. No. 128 at 14:8-22 ("Transcript").) Moreover, it is conceivable that the concept of "total fare" is wholly inapplicable in the context of cancelled rides. The dictionary defines "fare" as, inter alia , "the price charged to transport a person ." Merriam-Webster's Online Dictionary, https://www.merriam-webster.com/dictionary/fare (last visited March 8, 2018) (emphasis supplied). But when a ride is cancelled, no such "transport" occurs, and, thus, no such "fare" is charged.
It is also possible that the parties have assigned a special meaning to "total fare" in the context of cancelled rides. In any event, the Court need not address the remittance to drivers in the context of cancelled rides because only minimum fare rides are at issue in this litigation. The Court also does not predict how definitions in this context might relate to other disputes regarding the plain meaning of the Agreement.
Importantly, even if the Court were to lend credence to Uber's interpretation of the "Minimum Fare" as a "Safe Rides Fee"-inclusive "total fare," which it does not do for the aforementioned reasons, this would, at best, indicate that the Agreement was capable of two constructions. Assuming, for the sake of argument, that both constructions were reasonable, the Agreement would be deemed ambiguous. See TRB Invs. ,
The parties indicated at oral argument that the extent of the damages has not yet been determined. (See Transcript at 43:16-20.)
Excluded from this class are: (1) Uber; (2) the undersigned and the undersigned's immediate family; (3) persons who execute and file a timely request for exclusion from the class; (4) the legal representatives, successors, or assigns of any such excluded person; and (5) plaintiffs' counsel and Uber's counsel. (Class Cert. Motion at 3.)
In fact, Uber conceded at oral argument that its response to plaintiffs' class certification motion "is a merits argument." (Transcript at 38:16-18.) As the Ninth Circuit has explained, Article III standing "in no way depends on the merits of the plaintiff's contention that particular conduct is illegal." Chaudhry v. City of L.A. ,
Compare Defendants' Opposition to Plaintiffs' Motion for Class Certification, Dkt. No. 115 at 4-8, with Defendants' Cross-MSJ at 8-9, 12-15.
Uber's alternative argument with respect to standing, that is, that plaintiffs cannot show the damages element of their claims, fails for the same reasons.
Uber cites two denials of class certification issued by this Court in support of its argument that plaintiffs are not typical because they have repudiated the key averments of the FAC. However, these two cases are distinguishable from the matter at hand because they involved plaintiffs with theories of damages significantly different from the theory of the putative class. Corcoran v. CVS Health , No. 15-cv-03504-YGR,
Other cases Uber cites are similarly inapposite. See, e.g., Stearns v. Ticketmaster Corp. ,
The Court has modified slightly plaintiffs' proposed class definition such that "[A]ll persons in the United States" is not its own subpart.