Uber Terms and Conditions Do Not Bind Riders to Arbitration

• Pages: 25-26
• Date: 01 July 2023
• Author: Derek Wallen
• Subject Matter: Civil Law

Published in Litigation News Volume 48, Number 4, Summer 2 023. © 2023 by the Amer ican Bar Association . Reproduced with pe rmission. All rights re served. This info rmation or any porti on thereof may not be c opied or disseminated in an y

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Employers Must

Address Customer

Harassment of

Employees

By Nhan T. Ho, Litigation News

Contributing Editor

With great power over the work-

place comes great responsibilities. In

Christian v. Umpqua Bank, a federal

appellate court held that employers’

responsibilities include protecting

employees from sexual harassment

by customers. ABA Litigation Section

leaders agree with the holding in

Christian and note its important prac-

tical implications for employers.

The plainti was an employee of

the defendant bank. Beginning in late

2013 and continuing for approximately

one year, a customer repeatedly com-

mented about the employee’s looks,

asked her on dates, lefts notes for her,

badgered her coworkers about dat-

ing her, and stared at her during work

and work-sponsored charity events.

On multiple occasions, the employee

asked her supervisors to prohibit the

customer from coming into the bank

or to obtain a no-trespassing order

against him.

Despite the supervisors’ assur-

ance, the bank did nothing until the

employee, in writing, requested the

bank to take action against the cus-

tomer and to transfer her to a dierent

location. The bank ultimately closed

the customer’s account and transferred

the employee. The employee resigned

shortly thereafter and sued the bank

for violation of state and federal anti-

discrimination laws. After the trial court

granted summary judgment in favor of

the bank, the plainti appealed.

The U.S. Court of Appeals for the

Ninth Circuit found that that the

district court erred in failing to con-

sider all of the customer’s actions in

evaluating whether his conduct cre-

ated a hostile work environment for

the employee, including the incidents

when the employee did not have

direct interactions with the customer.

Concluding that a trier of fact could

f‌ind the customer’s harassment suf-

f‌iciently severe or pervasive to alter

the employee’s working conditions,

the Ninth Circuit held that the bank

could be held liable for the actions of

that customer. A reasonable jury could

f‌ind that, for failing to take immediate

and sucient corrective actions to stop

the harassment, the bank ratif‌ied or

acquiesced in it. Accordingly, the court

reversed the trial court’s grant of sum-

mary judgment.

Litigation Section leaders agree that

employers should be held liable for

their failure to address harassment in

the workplace. “When an employer has

knowledge that one of its employees has

been subjected to inappropriate con-

duct in the workplace, it isreasonable to

expect the employer to take measures

to eectively address the situation, or

risk being found liable for failing to do

so,” asserts Jerry Cutler, New York, NY,

cochair of the Section’s Employment &

Labor Relations Law Committee.

“The issue in Christian was not

about whether the bank was liable

to its employee for the actions of

the customer, but whether the bank

was liable based upon how the bank

responded (or, from the perspective

of the employee, failed to respond) to

the actions of the customer,” observes

Christopher S. Hennessy, Chicago, IL,

cochair of the Section’s Employment

& Labor Relations Law Committee.

Hennessy specif‌ies that the “focus

is on the actions and conduct of the

employer as it relates to its employees,”

and the source of the harassment that

adversely impacted the employee’s

rights in her workplace based on her

gender “did not matter.”

“Employers should immediately

begin an investigation upon learning of

the alleged harassing conduct,” advises

Cutler. “This includes meeting with the

employee, interviewing witnesses, and

gathering any relevant evidence. The

investigation should include a written

investigative report that contains fac-

tual f‌indings and conclusions pertaining

to the alleged conduct,” he explains.

“Where the investigation substanti-

ates the allegations, employers should

take prompt and eective measures to

ensure that the complained-of conduct

is not repeated,” Cutler concludes.

“These are topics that can be

addressed in workplace training,” sug-

gests Hennessy. Along the same vein,

“employers should distribute a written

policy to employees explaining that

harassment is prohibited, outlining the

mechanism for reporting instances of

such conduct, describing the investi-

gative process, and ensuring that the

employer will take prompt and eective

action when it is determined that such

conduct has occurred,” advises Cutler.

Uber Terms and

Conditions Do

Not Bind Riders to

Arbitration

By Derek Wallen , Litigation News

Contributing Editor

Mobile applications do not create

enforceable contracts with users if they

do not satisfy a two-prong test of rea-

sonable notice and consent. One state’s

high court ruled that Uber riders need

not arbitrate claims against the com-

pany despite an arbitration clause in

the app’s terms and conditions. The

design of the app, the appellate court

held, did not adequately notify users

of those terms and conditions, nor did

the interface require a clear manifesta-

tion of user consent. According to ABA

Litigation Section leaders, the case is

a warning to e-commerce companies

that enforceability of terms and condi-

tions depends on the careful design of

customer-facing technologies.

In Kauders v. Uber Technologies,

Inc., the plainti alleged that Uber

violated state antidiscrimination stat-

utes by refusing to provide him with

rides because he is blind. Based on

the app’s terms and conditions, Uber

successfully moved to compel arbitra-

tion. In June2018, the arbitrator ruled

in Uber’s favor on all claims. However,

three weeks after that award, the U.S.

Court of Appeals for the First Circuit

held in Cullinane v. Uber Technologies,

Inc., that Uber’s registration process

did not create an enforceable contract.

When Uber then moved to conf‌irm its

arbitration award in the Kauders case,

the Massachusetts trial court reversed

its earlier decision and concluded there

was no enforceable contract requiring

arbitration. On appeal, the Supreme

Judicial Court of Massachusetts

held that it was error under the

Massachusetts Arbitration Act for the

SUMMER 2 023 • VOL. 48 NO. 4

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